A Beginner’s Guide to Investing In Web3

by Mladen Maksic | Jun 14, 2022

The growing excitement about the Web3 universe and all the new possibilities that come with it is driving people to join this upcoming web revolution. Web3 offers exciting opportunities for both consumers and investors. Freed from centralized control, in the decentralized world of the internet of the future, users can directly collaborate to build digital ecosystems, earn crypto tokens, and even reap some of the rewards of building a thriving online world.

Many of us have heard of cryptocurrency, Ethereum, DeFi, NFT, DOT, and blockchain (and the list goes on) as they have become new buzzwords. But what exactly does it all mean, and how can you leverage these new investment opportunities to make money?

The internet is changing before our eyes. Web3 is still in its early stages, but it’s evolving rapidly and will become fully realized sooner rather than later. So, stay tuned as we will break down some of the best ways to invest in Web3 and potentially make a profit out of the new era of the internet.

The Decentralized Internet of the Future: What Is Web3?

Web 3, or Web 3.0, is the third generation of the evolution of web technologies. At the most basic level, we could say Web3 is a decentralized online ecosystem based on the blockchain. It is a new internet hybrid that aims to become the decentralized version of the virtual world.

Instead of a Web monopolized by large technology companies, Web3 is being built, operated, and owned by its users and uses blockchains, cryptocurrencies, and NFTs to give power back to individuals rather than tech giants and large corporations.

Creators are rewarded for the content they provide, and Web3 developers earn real value in the form of tokens for their work. Web 3.0 users can freely choose the project they want to support and be compensated for their engagement and trust by becoming Web3 investors.

Why Invest In Web3?

If Web3 being “the future of the internet” isn’t enough to get you excited about the investment opportunities that arise with it, here are some other reasons that might change your mind:

  • The global market for Web3 is expected to grow to around a staggering $176 billion by 2025. That’s a 700% increase compared to 2020.
  • Web3 is more efficient and secure, with the power entirely in the individual’s hands.
  • Web3 is still in its early stages of development, representing a lot of growth potential. Investing in Web3 means investing in an industry that is at its beginning, potentially having a stake in future businesses.

How to Invest In Web3?

Investing in Web3 is an opportunity to be part of the technological evolution and make a profit. Nonetheless, as with any emerging technology, there is no guarantee which companies and industries will be the big winners as Web 3.0 keeps unfolding. However, if you’re looking for a chance to own a part of Web 3.0 and potentially make money from participating, here are some of the investment opportunities:

Crypto Investment

Cryptocurrencies are probably what first comes to mind when thinking about Web3 investments. The simplest method to invest in Web3 is buying and selling digital currency/cryptocurrency (sometimes also called Web3 tokens). Crypto is already used to purchase NFTs, real estate, and other objects in the Metaverse, and developers see it as the “economic engine” of the future.

Things are volatile right now, but the crypto trajectory is more than promising and you can participate in the Web3 simply by purchasing coins. As of 11 April 2022, the top Web3 crypto projects by crypto market capitalization included Polkadot (DOT), Chainlink (LINK), Filecoin (FIL), Theta Network (THETA), and Helium (HNT). Despite all of them being volatile, they remain strong players in Web3, and some of them have multi-billion dollar valuations.

If you have programming skills, you could invest in cryptocurrencies by crypto mining. Cryptostaking is another way to cash in on crypto tokens. It enables you to earn money simply by holding onto your cryptocurrency. It’s with noting that holding Web3 tokens exposes investors to both the success and failure of the company. So, it’s essential to thoroughly research any Web3 project before buying any cryptocurrency they offer.

Investing In Web3 Companies and Stocks

Naturally, stocks based on this new iteration of the internet are also catching the eye of potential investors. Given the growing attention and interest in Web3, many tech companies, like Microsoft, are already trading in the public market, and you can gain exposure to Web3 developments by investing in the company’s stock. Besides buying stocks of companies working on Web3, you can also choose to invest in startups building Web3-related products or dApps.

Let’s explore some of these investment options in more detail.

Investing Through DAOs

Decentralized Autonomous Organizations, or DAOs for short, are built on public open-source blockchain and may just be the employer of the future. They enable more small investors to invest with their low cost and easy set-up. By investing in DAOs, you are investing in an idea or a project you believe in. There are dozens of options out there, and they are open to anyone – find one with a mission you care about.

DAO crypto tokens can be useful in many ways, such as for investments, creating NFTs, and fundraising. After all, DAOs need funding, too, so you can purchase DAO’s native tokens (or simply DAO Coins) in order to invest. They are cryptocurrencies tied to specific projects that you can find on the Ethereum blockchain, for example. It’s just like buying stocks from any company – the more tokens you have, the more voting rights you hold.

Investing In NFTs and Metaverse

Even though Web3, the Metaverse, and nonfungible tokens (NFTs) are not the same, they can function very well together. Investing in NFTs and Metaverse indirectly provides investors exposure to Web3, which is expected to support NFTs and Metaverse applications. Here’s how it’s all connected.

Metaverses, the virtual worlds that Web 3.0 will create, can also leverage Web3. Patience is needed because the metaverse could take a decade or more to develop. But this is actually great news for investors, as metaverse is still in its early stages, so it’s not too late to invest in metaverse stocks. A more direct way is to invest in metaverse real estate – buy “land” in the Metaverse with NFTs, although this is still speculative.

Non-fungible tokens, or NFTs, are one of the first building blocks of Web 3.0. NFTs are non-interchangeable units of data stored on a blockchain that can be sold and traded. This means you have total ownership of the NFT instead of it being controlled by a single entity.

As unique and non-replicable items, NFTs will have great value and utility in Web 3.0. – they can be used as a currency in the Metaverse, where they can be bought, sold, and traded. You can also use the NFTs for digital art, gaming, a digital wallet, and much more. NFTs offer endless possibilities.

Investing In Ethereum (ETH) and Polkadot (DOT)

Another investment method is to bet on projects or blockchains to make a good platform for future Web3 dApps. Ethereum would be the main one, but with its high fees, other alternatives like Polkadot might be more accessible. Let’s dive into detail.

Ethereum (ETH)

Everything from decentralized finance (DeFi) applications and non-fungible tokens (NFTs) to enterprise blockchain solutions rely on Ethereum’s technology. That has made Ethereum’s native token, Ether, the second-largest cryptocurrency after Bitcoin. If you want to potentially profit from the growing popularity of Ethereum (ETH), the most direct option is buying Ethereum itself.

Ethereum is highly volatile, so it carries the most significant risk but also offers the greatest potential profits. A less-volatile option is buying Ethereum stocks. These include managed funds invested in Ethereum and companies with significant exposure to Ethereum technology.

Polkadot (DOT)

Polkadot (or DOT for short) is one of the most popular cryptocurrencies in the global market, but is also a Web 3.0 project. Polkadot (DOT) is a cross-chain communication protocol founded by the Web3 Foundation, more precisely, Ethereum co-founder Gavin Wood. Unlike smart contract platforms like Ethereum (ETH) – layer one (L1) platforms on top of which decentralized applications (DApps) are built, Polkadot is a layer-zero platform.

Polkadot enables transfers of any asset or data across blockchains, meaning its service is not limited to tokens. With Polkadot, users can interoperate with multiple blockchains in the native Polkadot network. What sets Polkadot apart from competing networks, such as Ethereum, is that these parachains are unique and independent, but they can communicate with each other — a vital function for Web 3.0.

Other Ways to Make Money with Web3

What web 3.0 promises is an opportunity for ordinary people to see a little return on all that data and work they create every time they go online, thanks to blockchain. In the Web 3.0 multiverse, people and creators will be able to monetize the value of the work they create on a daily basis. Here are a few ways you can leverage these opportunities:

Mint Your Own Currency

Through the new Web 3.0 technology, you can create your own personal tokens or cryptocurrency through platforms like PRIVI. Personal Tokens allow users to mint and distribute for free and are a personal currency for individuals. The value of the currency directly depends on the value a user creates. How does it work?

By assigning a dollar amount to personal tokens, they can be distributed to your social media following or via other networking systems. They can then be used to pay the content creator for their product or service. With a higher quality of the content, a bigger following, and more transactions, the value of the personal token increases, as does demand (and vice versa).

Monetize Your Data

In the centralized world of the current internet, Web 2.0, large companies earn vast amounts of money from our personal data. Web3.0 lets you do the same, but for your own benefit.

Since Web 3.0 is built on blockchain, whose platforms are governed by the people (meaning no central authority), Web 3.0 protocols, like PRIVI, aim to return data ownership to the rightful owner and make it possible for anyone to capture and monetize their data daily.

Sell Your Work

Opportunities continue to emerge with the development of Web3 in non-traditional and fascinating ways. NFTs give web users the ability to earn money by selling their work, and the concept of the creator economy will likely come to a leading position in monetization. When you create content on Web 3.0 you have a variety of options on how you can monetize.

Digital artwork can be listed as an NFT. Authors and writers can now also sell and distribute their writing as NFTs by using Mirror – a decentralized app (dApp) – to create and sell content. You can even earn money by playing video games. It seems like there are no limits when it comes to Web3 opportunities, so feel free to explore!

If you don’t own NFTs, there are other ways you can participate in the NFT space, which you can learn more about here.

Investing and Earning With the Semantic Web

Web 3.0 is growing rapidly, and so are the technologies associated with it, opening a whole new world of investment opportunities. Investing in Web3 can present a great way to make money in the future, but it’s essential to understand the risks involved. Like most areas of crypto, Web3 is still in its infancy, so you need to think twice before investing.

Web3 currently presents regular people with an opportunity to invest early in a growing industry rich with venture funding and supported by top tech talent. NFTs, cryptocurrency, and direct investment in the Metaverse are a good place to start, but it’s important to keep the speculative nature of these investments in mind.

So, keep your eyes open for potential lucrative investments, but always remember to play it safe and do thorough research before investing in anything related to the fascinating Web3 universe. Good luck!

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