First came the World Wide Web, which connected businesses, technology and people across the globe. Then, Web 2.0 introduced the rise of platforms, apps and interactivity for users.
Blockchain technology has helped create the next evolution of the internet: Web 3.0. As Web3 continues to evolve, it is focused on decentralization, data security, and user privacy and it integrates cryptocurrency and other token-based economics.
The rise of Web3 could help investors make trades and utilize cryptocurrencies in their IRAs and other retirement accounts while keeping their data private.
What is Web3?
Like other products, the internet has gone through transformations and transitions for its users. Those who remember Web 1.0 experienced a read-only version of the internet, which meant that viewers could read content but not really otherwise interact with it.
In Web 2.0, users can post, “like,” subscribe and help add to the content that exists on the internet. One concern that some users have of Web 2.0 is the ease of data collection and privacy issues. By using data mining, companies can target ads based on how a user browses or utilizes the internet.
The movement to Web 3.0 combines the first two—allowing for reading and interaction—but it decentralizes ownership and theoretically lets users own their parts of the internet. That means that as users browse Web3, their digital identity is no longer connected to their physical identity.
Web 3.0 and Your IRA
Web 3.0 is expected to encompass nearly anything blockchain-related. As online retailers have begun to accept payments in cryptocurrencies, that can be considered a Web 3.0advancement. Investors are able to take advantage of this by buying Bitcoin, Ethereum, or other widely accepted cryptocurrencies.
Another way that investors can try to benefit from the Web3 movement is to consider its different projects. Take decentralized autonomous organizations, or DAOs, for example. DAOs are designed to replace traditional company boards, giving token holders voting rights to company decisions.
To better understand how DAO-type coins could work in an IRA, consider two (of the many) cryptocurrencies that Bitcoin IRA allows investors to purchase: Uniswap (UNI) and Compound (COMP).
Uniswap (UNI) is crypto associated with an exchange that runs off the Uniswap protocol. In a nutshell, Uniswap decentralizes the security of traditional banking transactions and the authentication process.
Another DAO coin, Compound (COMP), also facilitates transactions, but it is not an exchange. Compound gives owners the ability to lend and borrow the cryptocurrencies it supports at higher returns than typical savings accounts.
DAOs also have the potential to make money through dividends, depending on the goal of the project. Commitments to DAOs are just one way that Web3 could aid investors. As Web3 is being built, investors could also leverage the decentralization of corporate infrastructure for long-term financial gain.
How to Invest an IRA in Crypto
Bitcoin IRA is helping Americans invest retirement funds in the world of crypto. It’s the world’s first and most trusted crypto IRA platform that offers 24/7 trading and allows users to buy, sell and swap more than 60 cryptocurrencies for their self-directed retirement accounts.
As investors learn more about Web3 and how it can aid in retirement, they can quickly open a Bitcoin IRA account to start investing in crypto today.
Recommended articles: Guide to Cryptocurrencies in a Roth IRA
