There is a famous Youtube clip where David Letterman is interviewing Bill Gates in 1995 about the purpose of the internet. Letterman, and his audience, is sceptical from the outset, a scepticism that becomes vocalised when Gates explains a simple use case - a baseball game being announced live over the internet all round the world. Letterman cracks,“Does radio ring a bell?” and the audience howls with laughter before applauding. Gates joins in the laughter like a good sport, but he knows something that no one else in the entire studio knows, and it’s about to make him a multi billionaire.
Cryptocurrency is Having its Internet Moment
Fast forward 27 years and everyone knows what the internet is and the vast array of things it does for us. We use it every day for everything from banking to gaming, and yet back in 1995, Bill Gates was seen to be leading a technological revolution that no one wanted or thought they needed.
We can see the exact same thing playing out with blockchain technology, cryptocurrencies, the metaverse, and NFTs today. In fact the entire movement, however you would label it (‘cryptocurrencies’ is too small to encapsulate all the facets), has been bashed from pillar to post, mainly because it is still lacking a use case for people like those in the Letterman audience that day - everyday people who haven’t got the time to experiment with play-to-earn gaming and who don’t know anything about a crypto-collateralized instant.
But that time is coming, and the seeds are already being sewn. Take institutional banking, which is the last place you would be likely to witness a technical revolution. JPMorgan has two banking blockchains on the go, one of which, the Interbank Information Network, has hundreds of banks signed up, including some of the biggest in the world. All of these banks regularly send not money to each other but a token, JPM Coin, which they swap for cash at the other end. This is because sending JPM coin is cheaper and quicker than sending money.
Every Sector is Benefitting From Crypto and Blockchain
In the world of logistics, IBM’s TradeLens software, which is based on blockchain technology, is used by many of the world’s biggest shipping titans. TradLens allows all parties involved in all aspects of a logistics contract to see real time updates on the progress of a shipment, negating bureaucratic inefficiency, malpractice, and any errors in communication.
Then we have retailers of luxury goods who are increasingly turning to blockchain to verify authenticity of goods, and producers of vaccines using it to track shipments and log usage at the other end.
In 10 years time, such use cases will no longer be lone examples of companies striking out and trying a ‘new way’ of doing things - it will be the norm, with blockchains themselves adapting to cope with demand and new distributed ledger technologies taking things that next step further.
Change at Home
We will also see these developments in our own homes. Our exercise equipment, or even our gym shoes, will be linked to move-to-earn (M2E) protocols which reward us for exercising; we will be financially rewarded for watching adverts rather than paying to not watch them; we will meet up with friends in the metaverse and gaze in wonder at their new virtual home, while our friends laugh at our inappropriate new NFT avatar.
Outside the home life will be more rewarding too. If we drive to work or into town we will be able to sell the data harvested by our vehicles in return for cryptocurrencies, data which the car manufacturer will use to improve its products. We might also be rewarded for travelling on a certain type of public transport or at a certain time of day. Buy something from a certain shop with your loyalty card and you’ll be given cashback in cryptocurrencies as a thank you, as well as being able to actually pay in a range of cryptocurrencies. Want to tip the busker playing his guitar but don’t have any cash (of course you don’t!)? Simply scan his QR code and you can send him some crypto in seconds.
All these technologies are in development from companies building in this sector, but they are doing it under the radar and away from the public gaze so we don’t hear about them. Think about what Microsoft, Apple, and IBM were doing in the mid 1990s and you get an idea where we are right now.
The Changing Face of Finance
Within the cryptocurrency sector itself, there are a number of activities that are going to be commonplace in 10 years time that are obscure now. The first is personal finance. No one will be going to a bank anymore for credit, where their financial history will be assessed and their personal circumstances inquired about, only for an individual (or worse, an algorithm) to decide that no, you are not allowed a mortgage, even though you pay more than the mortgage in rent every month.
One of the key product classes offered by decentralised finance (DeFi) is that of instant loans, regardless of your credit history. Anyone with some collateral in the form of cryptocurrencies is able to take out an instant loan at the same (and often better) rates of interest than high street lenders offer, without the concern that your house is going to be repossessed if you don’t pay back - you surrender your crypto holdings and you get them back once you’ve paid off the loan. It sounds so simple, and yet it has taken this long to achieve because the technology was never there. Thanks to cryptocurrencies, now it is.
And of course if there are borrowers then there also needs to be lenders. Those same platforms also allow you to lend your cryptocurrency capital to borrowers and take a portion of the interest payments. Again, this is just one example of what the theory of decentralised finance can achieve - everyone is invited, even those with no bank accounts.
Power to the People
Of course, not all of these technologies will come to fruition. Some will succeed and many will fail, but the point is that thanks to the digital revolution we are finally able to actually, for the first time, really try. Even as late as the mid 2000s there was little concept of ‘social media’, certainly not to the extent that we know it now, and yet 20 years later it is its own sector worth over a trillion dollars. Times move fast.
Crypto visionaries are steadily establishing the roots of the next digital revolution, one that will empower the individual rather than corporate and financial titans. It’s no wonder that cryptocurrencies, NFTs, the metaverse, and DeFi are being unceremoniously bashed - the infrastructure is not yet in place for them to mature and flourish, so they are seen as pointless and wasteful.
What they are, in fact, are experiments, and it only takes a couple of those experiments to really succeed for the world to sit up and take notice. And they will - we just don’t know which ones yet.
In 10 years time however, expect the world, and the way you interact with it, to be very, very different.