Web3's Essential TCP/IP Moment Still Awaits

Web3's Essential TCP/IP Moment Still Awaits | Opinion

Web3 has yet to experience its critical breakthrough, akin to the TCP/IP moment of the early internet. The decentralized industry struggles with outdated networking protocols, hindering its ability to scale alongside emerging technologies. A new decentralized internet protocol is necessary to overcome these limitations, fostering trust, censorship resistance, and unrestricted participation.

Key Takeaways

Web3 lacks a universal networking protocol, relying on various restrictive methods that impede scalability.
The concept of a decentralized Internet Protocol (IP) is crucial for enabling large-scale web3 applications.
Research at MIT has led to breakthroughs in optimizing decentralized data movement through Random Linear Network Coding (RLNC).
Current blockchain infrastructure faces limitations due to fragmented systems, slow data propagation, and inefficient access.
A universal coded data layer could revolutionize Web3, unleashing new applications and facilitating unprecedented growth.

The next breakthrough in the crypto and web3 industry won’t be a faster chain; it will be a new, decentralized internet.

The Need for a New Internet Protocol

The internet expanded its capabilities due to Internet Protocol (IP), which provided a standardized way to route data globally. This innovation transformed isolated computer systems into a cohesive internet. Web3 faces a similar challenge but has not yet created a universal protocol for its decentralized networks. Relying on outdated networking methods results in inefficiencies, especially when scaling to meet modern demands, such as large-scale transactions or integrating AI systems.

While the desire for faster blockchains and larger data blocks is prevalent, these approaches are based on flawed networking models. For Web3 to truly scale, a new, modular, and efficient Internet Protocol must be designed from the ground up.

The Research Behind Decentralized Systems

For over 20 years, my research at MIT has revolved around whether decentralized systems can match the speed and reliability of centralized ones. We combined network coding theory—focused on optimizing data transfer—with distributed algorithms related to consensus and fault tolerance.

The conclusions were revealing: decentralized systems can achieve performance levels comparable to centralized models, but only when we redesign how data moves based on fundamental principles. After extensive experimentation, we identified Random Linear Network Coding (RLNC) as the most effective method for maintaining efficiency across decentralized networks.

With the advent of blockchains, the need for a dedicated protocol became evident. The designed protocol should withstand failures and attacks while providing scalable solutions globally. It's not about replacing existing infrastructure but laying the groundwork for what's to come.

Current Limitations in Decentralized Systems

As decentralized systems confront scaling challenges, four key trends illustrate the limitations of the existing infrastructure—all stemming from inherited networking assumptions of centralized systems.

1. Fragmentation in Layer 1 and Layer 2 Solutions

With over a hundred blockchains available, each one can optimize its local performance. However, when these networks need to coordinate globally, they face shared challenges related to data movement efficiency. What they lack is a shared infrastructure akin to an electric grid, which governs bandwidth distribution. A decentralized Internet Protocol would eliminate restrictions, speeding up block propagation and data retrieval.

2. Tokenization and DeFi Markets

Decentralized Finance (DeFi) struggles to manage significant transactions on networks where data propagation is slow or bottlenecks occur. A shared coded network connecting multiple chains would distribute data spikes better, preventing any single chain from becoming overwhelmed.

3. Global Scale for Decentralized Physical Infrastructure Networks (DePIN)

As networks of devices and autonomous machines expand globally, inefficient communication also presents a barrier. Nodes relying on slow, single-path communication need to operate as a cohesive unit. A decentralized protocol must ensure they can absorb all data optimally and deliver it where needed.

4. Decentralized AI Development

Distributed AI efforts, whether training models or coordinating agents, require swift, reliable data movement. Current decentralized storage solutions hinder access and retrieval, as they still rely on centralized gateways. The solution demands a logistics approach to data—encoding it during transit, storing it in fragments, and quickly retrieving it from the best available sources.

The Future Leap for Web3

Significant advancements in internet progress have always been driven by innovations in data movement. The introduction of IP enabled global reach; broadband made streaming possible; advancements like 4G and 5G facilitated apps such as Uber and TikTok; while GPUs catalyzed the deep learning boom. Smart contracts unlocked programmable finance.

A universal coded data layer for blockchain systems could generate transformative applications for Web3, akin to what IP accomplished for the early internet—creating the conditions for future innovations we have yet to envision. This foundational shift will elevate Web3 from an experimental phase to an indispensable part of our digital landscape.