There are few other companies as prominent and influential in the development of the internet we know today as Alphabet (GOOG -1.30%) (GOOGL -1.21%). The tech giant has its hands on just about every niche of the internet from its search engine, to its cloud services, to its own smartphone. 

Despite its success, Alphabet recognizes that a new frontier has the capability to help usher in a new age of the internet known as Web3. 

The next iteration of the internet is being built

Unlike Web2, which Alphabet's Google has dominated, Web3 refers to the next generation of the internet, which focuses on decentralization, security, and interoperability between different protocols. To accomplish this, blockchains have become the building blocks for developers due to their inherent decentralized and secure nature. 

Back in May this year, Google formed a Web3 division to capitalize on the "tremendous potential" that Web3 possesses. While still in its early form, Google has already released a handful of innovative solutions that should ensure that the company is able to maintain relevance in the age of Web3.

Rather than creating its own blockchain like Bitcoin or Ethereum, Google wants to "build a giant bridge" between Web3 developers and blockchains by offering node services through Google Cloud. Referred to as the Blockchain Node Engine, this service essentially makes Google the backbone of Web3 and acts as a "Layer 0" for Web3 development.

A node is a container that runs code for crypto networks and is typically run on a computer or server. It is an essential Web3 building block and is required for networks like Ethereum to run properly. The more nodes a network has, the more decentralized, scalable, and secure it can become.

However, the work that goes into propping up, running, and maintaining a node can be timely and costly. To mitigate this, developers can use the Blockchain Node Engine to build new applications on the blockchain of their choice. In doing so, developers don't have to worry about installation, upkeep, and maintenance. Rather than waiting for nodes to sync with the network, which can take several days, developers can get to work immediately.

In addition, Google offers state-of-the-art security features for blockchain infrastructure that are currently limited in the market. Developers can utilize built-in firewalls to ensure that only designated machines are able to communicate with each other. And best of all, if Google will maintain the node. If it goes down, the node is automatically restarted so that developers can focus on developing.

Currently, only Ethereum is supported by the Blockchain Node Engine, but there is optimism that Solana will also become available sometime in 2023 and based on other comments more blockchains should be added in the future.

An all-time bargain buy

It might seem counterintuitive or a conflict of interest for Google to embrace Web3 when considering that a fair amount of the success it has benefited from in the last couple of decades derived from alleged monopolistic business practices that harvest user data. Concern over whether Google will turn Web3 into just another version of the centralized Web2 is likely warranted. 

But there is reason to be at least a little optimistic that Google's Web3 division is aware that this age of the internet requires a different approach. Fortunately, it seems Google's head of strategy for Web3 is aware of this conundrum. At the Mainnet conference in New York City in September, Richard Widmann recognized that the point of Web3 is to maintain decentralization and security and that "if everything is running on Google, I will be the first to say that is a problem."

Many believers in Web3 were likely optimistic that it would put an end to some of the major players of Web2 or at least unravel some of their power. But based on Google's progress with the Blockchain Node Engine, it looks like the company might only increase its dominance of the internet. Although Alphabet's stock is down nearly 40% this year, when considering the current grasp Google has on Web2 and its goals to become a major player in Web3, investors should view the stock's recent decline as just another reason to add it to their portfolio for long-term success.