Skip to main content

What Is Web 3.0? (And Why Should Banks & Credit Unions Care?)

 


A new version of the web-based on blockchain technology — is being predicted and promoted. Even though the trend has vocal naysayers, elements of Web 3.0 are already in use, including by a new crop of disruptive nonbank competitors.

By Steve Cocheo, Executive Editor at The Financial Brand

If the term “Web 3.0” has crossed your radar, and you are wondering what it is and whether it’s worth starting another ulcer over, we have four words for you: Eco, Valora, Compound and TrueFi.

Eco, which promotes the fact that it is not a bank and not FDIC insured, offers accounts held in stablecoins that function as both spending and savings accounts, but with higher returns.

Valora is an app available through the App Store and Google Play that uses the blockchain to deliver a version of P2P services out of a mobile crypto wallet.

Compound describes itself as “an algorithmic, autonomous interest rate protocol built for developers, to unlock a universe of open financial applications.” Among the services using it is Compound Treasury, which promises a 4% annualized return with dollar deposits turned into stablecoins as well.

TrueFi is a marketplace lender offering unsecured loans for borrowers and an opportunity for people with funds to invest in loans to earn a higher return. TrueFi is a form of decentralized finance — “DeFi” — using stablecoins.

Numerous tech and crypto investors back these fledgling companies, all of which are doing business through some aspect of “Web 3.0,” also called “Web3.” One investor in common is Andreessen Horowitz.

The venture capital firm is investing heavily in crypto through a hedge fund. In late 2021 it launched a lobbying campaign in support of its idea of how the World Wide Web should evolve, and, along with it, many of the businesses and activities that tie into it — including financial services. This push so far includes issuing ten Web 3.0 principles for world leaders shaping the future of the web and publishing a major Web 3.0 white paper, “How to Win the Future: An Agenda for the Third Generation of the Internet.”

Regarding financial services, that paper states: “Our financial system needs to be revamped for fast payments. It also needs to be more inclusive; for instance, by improving access to credit through better credit scoring that incorporates more data sources. Web3 has demonstrated the potential of alternatives to the current system. Decentralized finance, or DeFi, is also supplying a wave of new infrastructure to support more sophisticated financial products…”

There’s more in the paper, but it’s far from the only voice in Washington promoting Web 3.0. Anti-bank rhetoric is part of it.

In congressional testimony on Web 3.0, Brian Brooks, former Acting Comptroller of the Currency, who liberalized treatment of crypto activities by national banks, said in part: “Do we believe a user-controlled decentralized internet is better than an internet largely controlled by five big companies? … Do we trust big banks more, or open-source software more, as a tool for maintaining ledgers of account and allocating credit and capital?” Brooks is now CEO of Bitfury Group, a supplier to the cryptocurrency business.



Clearly, both traditional financial institutions as well as neobanks and fintechs have to understand what Web 3.0 is and how it could develop. The following Q&A presents the basics of what is already becoming a very complicated new field.

Comments

Post a Comment

Please no profanity or political comments.

Popular posts from this blog

A Perfect Example - What Makes Credit Unions Different from Banks!

When the government shutdown hit in October and paychecks stopped, thousands of federal employees were left wondering how to make ends meet. Credit unions across the country stepped up—but Keesler Federal Credit Union went above and beyond. No loans, no hassle—just your paycheck Instead of making members apply for emergency loans, Keesler Federal launched its Paycheck Relief Program. Revolutionary in its simplicity, it worked like this: if you were a federal employee with direct deposit at Keesler Federal, your paycheck kept coming—interest-free, fee-free, and stress-free. Each qualified member could receive up to $6,000 per pay period for as long as 90 days. No hoops, no headaches. From October 1 until the shutdown ended, Keesler Federal advanced more than 5,000 paychecks totaling $6.5 million to 1,710 members. For non-members, they even offered zero-interest loans up to $6,500 with a year to pay it back. This proactive approach meant that before the first missed paycheck, Keesler Fed...
Post a Comment
Read Complete Article HERE>»

Sunday Reading - What's the point of a consumer electronics show?

  What's the point of a consumer electronics show? Consumer electronics shows are large convention-type events where companies debut new technologies and products. The largest and most notable shows are CES in Las Vegas, a trade show every January, and IFA Berlin, which takes place annually in September. The events have historically introduced novel, cutting-edge products that later became household standards, like HDTVs, VCRs, DVDs, and gaming consoles ( see list ).   Over time, these shows evolved from product showcases ( see last year's coolest gadgets ) into complex industry ecosystems, serving as a meeting ground for startups, multinational technology companies, investors, and the media. Hardware launches, keynote speeches, and...
Post a Comment
Read Complete Article HERE>»

Eight Credit Unions Pay $42 Million in Special Dividends to 1.1 Million Members

  By  Jim DuPlessis   | January 05, 2026 at 04:00 PM So far this season, CU Times has tallied 19 credit unions, which have announced $160.3 million in special dividends for members.       Eight more credit unions have reported special dividends, paying their 1.1 million members $42.1 million in December and January. The bulk of the dividends came from Police and Fire Federal Credit Union of Philadelphia and Eastman Credit Union of Kingsport, Tenn., which each announced $16 million in rewards approved by their boards. The late January payout from Eastman ($9.7 billion, 356,492 members) will bring its total special dividends to $225 million since 1998. A news release from the credit union said “the Extraordinary Dividend is never guaranteed, but the strong financial performance of ECU in 2025 enabled the Board of Directors to approve this year’s $16 million payout.” Eastman’s $16 million payout represents about $47 per member and 19 basis points of its averag...
Post a Comment
Read Complete Article HERE>»

Syracuse Fire Department Credit Union

 Congrats, Tonia, on your promotion! ================================================= Remember, you're not alone with  NCOFCU.org Join/Upgrade Check out some of NCOFCU's additional features: First Responder Credit Union Academy Financial Literacy Podcasts YouTube Mini's Blog Job Board
Post a Comment
Read Complete Article HERE>»

Sunday Reaing - Can the seasons really make you depressed?

    Can the seasons really make you depressed? Seasonal affective disorder   is a form of depression that repeats during predictable seasonal shifts, impacting an estimated 5% of the global population—predominantly women. Symptoms of the condition occur with significant cyclical changes in daylight hours, with prevalence increasing in regions north of 40 degrees latitude (less commonly in the Southern Hemisphere). Its etiology—or root cause—remains unclear to researchers. Though “winter blues” are commonly reported, SAD is a distinct, diagnosed subtype of major depressive disorder first formally described in 1984 ( see criteria ). Key symptoms—lasting roughly four months each year—resemble common depression: fatigue, increased sleep, carbohydrate cravi...
Post a Comment
Read Complete Article HERE>»

What Could Tokenized Deposits Mean for CUs?

WASHINGTON—Noting that the FDIC has expressed support for tokenized deposits as insured bank liabilities, not experimental digital assets, a new analysis offers some insights into what that could mean for financial institutions, credit unions and the market in 2026 and beyond.  As PYMNTS Intelligence pointed out in its report, regulatory clarity reduces risk for banks moving from pilots to live deployments, and large banks and infrastructure providers are already testing real-world tokenized deposit use cases.  “At its simplest, tokenization converts an existing claim into a digital representation on a distributed ledger,” the report explained. “The underlying asset does not change, but the infrastructure that tracks ownership and settlement does. In banking, that distinction is critical. Tokenized deposits do not create new money. They represent traditional bank deposits, issued and redeemed by regulated institutions but designed to operate on modern, programma...
Post a Comment
Read Complete Article HERE>»

Auto Link, Home Link, and CalcuLink Unite Under New Parent Brand: Centergy Solutions

Auto Link, Home Link, and CalcuLink Unite Under New Parent Brand: Centergy Solutions Auto Link announced a major rebrand that unifies its three established product lines- Auto Link, Home Link, and CalcuLink- under one cohesive parent brand. The transition marks a strategic evolution designed to simplify the company’s ecosystem, strengthen product synergy, and enhance the overall experience for credit unions and the members they serve. The new Centergy Solutions brand reflects the company’s mission to deliver a more connected and integrated suite of digital tools across auto and home lending, auto and home buying, and financial decision-making. From an operational perspective, the unified brand also allows Centergy Solutions to accelerate innovation and improve platform alignment. Under the new parent brand: • Auto Link continues to support financial institutions with industry-leading digital auto lending tools that boost member engagement and loan volume. • Home Link provides consume...
Post a Comment
Read Complete Article HERE>»

Fed Raises Rates to Highest Point Since 2001; Here's What CU Economists Are Saying

WASHINGTON—Emphasizing it remains “highly attentive to inflation risks,” the Federal Resoerve has moved to hike interest rates by 25 basis points, setting the target range for federal funds at 5.25 to 5.5%--their highest level since 2001. The Federal Open Market Committee made the announcement Wednesday at the close of its July two-day meeting here, and suggested it may not yet be done with rate increases. “Recent indicators suggest that economic activity has been expanding at a moderate pace. Job gains have been robust in recent months, and the unemployment rate has remained low. Inflation remains elevated,” the Fed stated in a release. Tighter Conditions “Tighter credit conditions for households and businesses are likely to weigh on economic...
Post a Comment
Read Complete Article HERE>»

NAFCU is offering a free webinar today on PPP

ARLINGTON, Va.—NAFCU is offering a  free webinar today  to help credit unions better understand the process for offering loans through the Small Business Administration's new Paycheck Protection Program (PPP). Just a day ahead of the launch of the program itself, the SBA last week released an interim final rule to implement the program. In response,  NAFCU developed an FAQ document  answering 22 questions credit unions are likely to face as they consider participating in the program (see related story). Previous guidance from the Treasury Department indicated all federally-insured credit unions will be able to offer loans under the program, but those that are not currently SBA-approved lenders  must submit an application  to become one. During today’s webinar, set to begin at 4 p.m. ET, credit unions will hear from Steve Meirink, executive vice president and general manager of compliance solutions in the Governance, Risk & Compliance division a...
Post a Comment
Read Complete Article HERE>»

Consumers Want More and More from Mobile Banking. If You Don’t Keep Up, They Could Walk

  Research by MX reports that consumer expectations for your banking app just keep getting higher. And dissatisfied users will likely jump to another app (and another bank) that ticks more boxes. How can you stay ahead in the app game? Mobile banking apps have become table stakes for banks and credit unions, especially among Millennials and Generation Z. Research from MX earlier this year indicated that a decent mobile banking app is a must-have for nearly one in four consumers starting a relationship with a financial institution. MX research also shows that 80% of consumers have a payment app, such as Venmo, PayPal or Cash App on their phone. In addition, 77% have a bank or credit union mobile banking app, 48% have a credit card app, 25% an investment or retirement savings app, and 17% an independent app to help manage their finances. Nearly half maintain three or more financial apps on their devices. Now a new round of MX research indicates that the quality of the ...
Post a Comment
Read Complete Article HERE>»