In recent years, the keyword “Web3” has been attracting attention in the context of cryptocurrencies and blockchain. Web3 refers to a new generation of internet environment built on blockchain technology, characterized by decentralization and user-led ecosystems. However, in reality, many projects have not yet achieved “complete decentralization.” An interesting example of this is “Pi Network.” Pi Network has gained attention for allowing users to easily mine (strictly speaking, perform validation work) cryptocurrency with their smartphones, but its application layer is currently far from being fully decentralized. Therefore, in this article, we will examine the current state and future prospects of Web3 as a whole, using Pi Network as an example.

What is Web3: The Concept of Decentralization

Web3 is a new form of the internet built on blockchain technology. While the traditional Web2 is a model centered around centralized server management, the goal of Web3 is to store and process all data and content in a decentralized manner on the blockchain. By achieving this decentralization, users are expected to have more direct control over their data and assets, and the transparency and censorship resistance of platforms are also expected to increase.

However, it is still too early to speak of complete decentralization, and many projects remain partially decentralized by utilizing servers. For example, while cryptocurrency transaction history is recorded on the blockchain, actual application functions and data are often managed on central servers, leaving challenges in truly experiencing Web3.

Overview of Pi Network: Currency Decentralization and Application Challenges

Pi Network is known as a project where participants can earn cryptocurrency through a mobile app. It has attracted many users, especially due to its ease of use, which does not require large-scale computing power like Proof of Work (PoW). On the other hand, in the use cases and applications where Pi is actually used, processing is not necessarily performed entirely on the blockchain.

Although the current application layer of Pi Network is referred to as a DAPP (Decentralized Application), it is said that the majority of its data and logic run on central servers. This is because it is often difficult for the blockchain alone to handle large amounts of data storage and complex computations. Therefore, it is understandable that many applications running within Pi Network raise the question, “Can they truly be called Web3?”

Why Complete Decentralization is Difficult

Currently, there have been remarkable advancements in blockchain technology infrastructure and hardware, but it is not easy to put all the data volume and processing demands handled by DAPPs on-chain. For example, attempting to store all large data on nodes would cause the storage load on the entire network to skyrocket. Furthermore, high-speed consensus protocols and scaling technologies are essential to increase transaction throughput, but the current situation is that they are far from being fully mature.

Therefore, in the practical stage, a “hybrid” configuration is common, where only important transactions and token management are placed on the blockchain, and other data is entrusted to central servers or separate decentralized storage. It is believed that Pi Network is taking a similar approach, and at present, even if currency decentralization is relatively advanced, it has not reached complete decentralization of the application layer.

Infrastructure Shortage: Storage and Computing Power

The fact that decentralized storage and decentralized computing platforms specialized for blockchain are still in their early stages of development is also a factor delaying the complete decentralization of DAPPs. To enable many nodes to simultaneously store large capacities and perform advanced processing, significant investment is required in both hardware and network bandwidth. Currently, since such environments are not yet in place, many projects are inevitably relying on the power of central servers or the cloud.

Advantages and Limitations of the Hybrid Model

As a practical solution to balance practicality and decentralization, the hybrid model has the following advantages:

• Parts requiring high-speed processing can be supplemented by a central server
• On-chain parts can be limited to only tamper-proof transactions
• Can be flexibly scaled according to user growth

On the other hand, as long as a central server is used, the risk of being affected by server downtime or the intentions of the project developer cannot be completely eliminated. Also, because there is a gap with the pure decentralization that Web3 originally aims for, it may be considered by users as “not true Web3.”

Future Outlook: Collaboration between Pi Network and the Infrastructure Supporting Web3

Many blockchain projects, including Pi Network, aim for complete decentralization in the long term, striving for a world where users can independently manage all applications and data. However, this requires the following infrastructure development:

• Stabilization of Decentralized Storage: Technology for efficiently storing large amounts of data across all nodes
• High-Speed Consensus Mechanism: A mechanism for many nodes to process transactions and reach consensus in parallel
• Scalable Network: Protocols that can expand processing capacity as the number of nodes increases
• Rich Developer Ecosystem: Tools and communities that facilitate DAPP development

As technology in these areas matures, the possibility of many projects, not just Pi Network, achieving a “complete Web3 era” increases. Especially for platforms like Pi Network that already have a large user base, there are expectations that they will make significant leaps forward by deploying full-fledged decentralized applications once the infrastructure is in place.

Summary: We are Still in the Dawn of Web3

As seen above, looking at the current state of Web3 using Pi Network as an example, it is clear that while currency decentralization is progressing, the application layer is still at a stage where it has to rely on central servers. Due to the immaturity of hardware, blockchain technology, and related infrastructure, complete decentralization remains an “ideal theory.” However, precisely because of this, entering at this stage, gaining experience, and waiting for the technology and infrastructure to mature can be considered a great opportunity.

In the future, with the evolution of decentralized computing and decentralized storage, a world may be realized where applications themselves can be stored on the blockchain, providing diverse user experiences. Pi Network is also expected to evolve along with its user community as one example exploring this possibility. In any case, Web3 is still in its early stages, and technology and business models are expected to change rapidly in the coming years. If you are interested, actively gather information and make the most of the opportunities.