Definition
Web3
Web3 is a vision of an internet built on blockchains where users own their data, identity and assets through tokens and wallets rather than relying on centralised platforms. This is informational.
Web3 describes a proposed next phase of the internet where decentralised protocols, tokens and crypto wallets give users ownership and control, in contrast to today's platform-dominated web. It encompasses cryptocurrencies, NFTs, DeFi and decentralised apps.
Proponents emphasise self-custody and permissionless participation; critics point to scalability limits, scams, complexity and the speculative nature of many tokens. Much of Web3 remains experimental.
In India, Web3 assets are generally VDAs subject to the 30% tax and 1% TDS, while the broader regulatory framework continues to develop. This entry is informational only, not investment advice; the space is high-risk.
Related terms
- BlockchainA blockchain is a shared, append-only digital ledger where transactions are grouped into cryptographically linked blocks, making records hard to alter without consensus.
- DeFiDecentralised Finance refers to financial services — lending, trading, yield — run by smart contracts on blockchains without traditional intermediaries. This is high-risk and informational, not advice.
- NFTA non-fungible token is a unique blockchain record representing ownership of a specific digital or tokenised item, such as art or collectibles. In India it can be a taxed VDA. This is informational.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.