How to invest in Web3

For those wondering what Web3 means, here’s your beginner’s guide to the internet’s latest evolution and how you can invest in Web3.

One of the most popular buzzwords to spawn from the cryptocurrency movement in the last decade or so is “decentralisation” and simply put, it’s all about taking control away from central authorities, empowering users instead. This idea of decentralisation forms the backbone of what’s known as “Web3”.

With decentralisation playing a key role in blockchain technology, it’s no surprise investors are interested in what’s projected to be a $69 billion (about £58 billion) market by 2023. For context, that’s a compound annual growth rate of 68% between now and then. Blockchain fuels Web3 – and that’s a movement with some lofty ambitions. Web3 dreams of a world where users manage their data and transactions, instead of gatekeepers and big corporations.

Key takeaways

  • Web3 represents the latest stage in the internet’s evolution.
  • There are numerous ways to invest in the space, from cryptocurrencies to stocks.
  • Web3 investments come with higher risk due to regulatory uncertainty and volatility.

What is Web3?

Web3 (or Web 3.0 if you want to get old school) is the name for the latest version of the internet. It embodies concepts like decentralisation, blockchain, artificial intelligence (AI), augmented reality (AR), virtual reality (VR), cryptocurrencies, and decentralised finance (DeFi).

For context, we’re currently navigating Web 2.0 (Web2), which relies mostly on user-generated content presented in a format that’s functional and easy on the eye. If you’re old enough, you might remember Web 1.0, which was pretty ugly (sorry). But it was the first iteration of the internet and mostly read-only, static content – opposed to the highly interactive experience we all have today.

How to invest in Web3

  • Open a share dealing platform. The first step in investing in Web3 stocks is to open a share trading account. Choose a platform that suits your needs, whether it’s one with robust research tools, low fees, or a user-friendly interface.
  • Fund your account. Once your account is set up, deposit funds. You can do that via a bank transfer, debit card, or any other means allowed by your platform.
  • Research and choose Web3 stocks. Research the best Web3 stocks (or funds) for your portfolio, and then search for them on your chosen platform by company name or ticker symbol.
  • Buy shares. Once you’ve found the stock(s), select the amount you want to invest and create an order to buy shares. Just like that, you’re now an investor in the Web3 movement.
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Best Web3 stocks to watch

It’s hard to pin down the best Web3 stocks at any given moment because it’s a fluid and fast-moving industry (to say the least), but here’s a quick look at some of the top Web3 stocks making waves today:

  • Coinbase (COIN). One of the largest US crypto exchanges. While there are other, bigger players, these aren’t publicly traded. If you want exposure to the crypto trading market, Coinbase may be your only bet.
  • Block (SQ). Block (formerly known as Square) has various businesses across its portfolio. Some are more Web2, like its payments platforms for small businesses. Others are much more Web3-esque, like the “Cash App” for person-to-person transactions and its “TBD” subsidiary for decentralised finance platforms.
  • Meta Platforms (META). Meta (aka the refreshed Facebook) as proven by its new name, focuses on the metaverse. While the metaverse isn’t entirely about decentralisation, it offers some Web3 capabilities – like the ability to manage your assets. That makes META more of a Web2 investment, but with a touch of Web3.
  • HAN Web 3.0 ETF (WEB3). An exchange-traded fund (ETF) reflects a basket of shares, offering a more diversified and risk-averse way of investing in a theme or industry. HAN’s Web 3.0 ETF provides access to 20 investments in 1, including NVIDIA (NVDA) and Roblox (RBLX).
  • Microsoft (MSFT). Microsoft is a long-standing tech titan. Recently, it has partnered with newer startups like Aptos to dive deeper into AI and Web3. Microsoft will leverage Aptos’ technology to heighten security across its Azure cloud tech. Like Meta, Microsoft is still primarily Web2 but offers some Web3 investment exposure.

Other ways to invest in Web3

Here are a couple less-traditional ways to invest and dip your toes into the world of Web3:

  • Cryptocurrencies. One of the easiest ways to invest in Web3 is through cryptocurrencies like Bitcoin and Ethereum. They’re by far the most popular, but many other coins like Tether and Solana are rising in the ranks. Access cryptocurrency investments by setting up an account through a cryptocurrency exchange, investing in the coin of your choice, then storing it in your wallet until you’d like to sell.
  • Non-fungible tokens (NFTs). Think of NFTs as a contract of ownership that can represent anything from a digital painting to virtual real estate. Although the market is in a slump compared to its peak in 2021, many investors argue there’s still a use case for their identification technology. Some NFT collections, like Cryptopunks, still have market caps currently sitting at around $872 million (about £657 million), so it’s not pocket change. But remember, NFT values can be highly speculative, so it’s crucial to do your research before investing through platforms like OpenSea.

Is Web3 worth investing in?

Web3 is still in its infancy. While it offers massive potential, it also involves outsized risk compared to other existing technology investments, like well-established tech stocks.

If your research suggests a future where decentralisation is the norm and users have greater control over their digital footprint, you may want to invest while the sector is young. Given the volatility, these investments should form part of a diversified portfolio to balance risk.

What is the best Web3 to invest in?

The best Web3 investment depends on your intentions. If you seek higher risk and more speculative alternatives, consider cryptocurrencies, as they are crucial for propelling Web3 forward. Meanwhile, stocks like NVIDIA or Block might be less volatile since they are involved in various tech market opportunities, not just Web3.

What are potential risks of Web3 investing?

Investing in Web3 carries greater risk than other opportunities as it’s still an emerging technology, key risks include:

  • Regulatory uncertainty. The world is still figuring out how to regulate technology that spans global borders.
  • Security risks. Digital assets must be secure; otherwise, they lose their value and meaning. The industry is highly reliant on cybersecurity to prevent hacks or scams.
  • Market volatility. As with all investments, Web3 is subject to price swings and market crashes.

Passive vs Active Investing in Web3

Here’s a brief summary of your options when it comes to passive and active investing in the Web3 space:

  • Passive investing. Generally means the stock picking is done for you, so through an ETF investment, for instance. The idea is holding long term and letting the investments grow over time.
  • Active investing. This typically involves paying a fee to a fund manager or stock-picker to trade in the Web3 space (but it can also include you actively making trades). It’s more speculative and requires deeper knowledge of market and industry movements.

Is the transition to Web3 inevitable?

George Sweeney

Finder expert George Sweeney answers

Yes and no. It’s impossible to deny that internet technology is going to advance and evolve over time. So at some stage we will experience a new version of the internet, different to the one we currently know and love (or loathe). However, whether the next iteration of the internet ends up being what’s currently referred to as Web3 is still unknown. We might end up in a decentralised technology utopia, who knows, but part of me doubts it. The technology companies that have a stranglehold on Web 2.0 and are worth trillions of dollars and are unlikely to loosen their grip unless forced to.

Our reliance on a handful of companies to control and dictate the internet space (it’s not the “wild web” anymore) means we could be waiting longer than some are hoping before we get to the ideal Web3. By definition, Web3 means more ownership, control and interaction from everyday internet-users. And I’m just not sure people have the knowledge or motivation to take over the reins of the internet, most people just prefer to have things be as easy as possible. So we need better Web3 interfaces before it can become a practical (virtual) reality.

Pros and cons of investing in Web3

  • High growth potential from an emerging technology
  • Multiple ways to invest in the sector
  • Greater control over digital assets
  • Significantly greater risk than other industries
  • More market swings and volatility
  • Security concerns can hit Web3 harder

Bottom line: Is Web3 the future?

There’s no question that Web3 is a growing movement, with an increasing number of companies backing its ideals. With plenty of potential, Web3 looks promising. It’s anything but stable though, and still may prove to be a bubble.

Given it’s not a single technology, nor a single platform, to lump it all together and try to assess it as a collective entity is shortsighted at best. That means research is key. And if you’re still uncertain, it’s probably best you start small and slow, by investing in the companies taking it gradually too.

Frequently asked questions

All investing should be regarded as longer term. The value of your investments can go up and down, and you may get back less than you invest. Past performance is no guarantee of future results. If you’re not sure which investments are right for you, please seek out a financial adviser. Capital at risk.


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To make sure you get accurate and helpful information, this guide has been edited by George Sweeney, DipFA as part of our fact-checking process.
Money expert

Gemma is a freelance writer for Finder. She previously worked for Freetrade and Chip and has market commentary published on sites including the BBC, Financial Times, Guardian, Evening Standard, Forbes and Fortune. She's passionate about narrowing the female investment gap with compelling and actionable content. She has her CFA Level 4 Certificate for Investment Management, and Masters of International Business from University of St Andrews. When she's not writing, she's usually reading, or exploring the city on a run. See full bio

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