The illusion of the Web3 decentralization

Abstract This article critically examines how Web3 decentralization policy trends impact global digital governance, questioning whether they genuinely distribute power or merely shift influence to a new, tech-savvy elite. Based on fieldwork in Silicon Valley since August 2022 and engagement with scholars and practitioners up to December 2025, the article provides a conceptual analysis with emerging empirical insights around the nascent global Web3 movement. While Web3 advocates challenge centralized data monopolies and traditional state structures, this analysis critiques the assumption that Web3 democratizes power, highlighting both its potential for inclusion and risks of exclusion, insofar as it may reinforce hierarchies rooted in technical expertise and digital access. While acknowledging the broader landscape of Web3 governance (including hybrid and federated models) and scoping the Global North and Global South contexts considering global adoption cases, the article particularly focuses on three post-Westphalian paradigms: (i) Network States, (ii) Network Sovereignties, and (iii) Algorithmic Nations. While Network States advocate for crypto-libertarian governance, Network Sovereignties and Algorithmic Nations emphasize cooperative governance aimed at empowering minority communities, such as indigenous groups, stateless nations, and e-diasporas, through decentralized, data-driven systems. By engaging with both the limitations and some promises, prospects, and pitfalls of Web3, this article questions whether Web3 can create a more inclusive global order or if influence is increasingly concentrated among a new elite. This article contributes to debates on sovereignty, governance, and citizenship by advocating hybrid policy frameworks that balance global and local dynamics, emphasizing solidarity, digital justice, and international cooperation for equitable Web3 governance.