This post originally appeared on The BSV Blockchain Gazette on LinkedIn, and we republished with permission from the author.
Global Public Policy Director Bryan Daugherty is coming to you from the U.S. with his forecast of the blockchain industry in 2023.
1. The rise of problem-specific bespoke web3 solutions
The promises of a new enterprise data management and monetization infrastructure will begin to be realized. Applications designed to solve industry-specific problems, such as fraudulent ticketing or file integrity assurance will begin to enter the market.
After courts and regulators have cleared many bad actors out of the crypto casino, scalable blockchain technology will emerge as the winner and businesses begin to adopt its multiplicity of features and functionalities.
This broad integration across industries will create improvements in efficiencies, data integrity, and cost. Some examples aside from the ones listed above may include, supply-chain management, cross-border remittances, property titles, and many more.
2. Consumer-protection inspired regulation
Mass closures of digital currency-focused business models including exchanges
Due to the combination of more stringent regulations, regulatory oversight, a constricting financial global economy, and prevalent exit scams and hacks, questionable exchanges and unregulated platforms will likely be investigated and in turn, shut down.
Many policy makers have made it clear that the Howey Test applies to ‘crypto tokens’ and existing projects may find themselves having to answer some pertinent legal questions.
There could be additional focus on questionable contributions to political figures by digital currency exchanges, influencers, and entrepreneurs.
3. Broader interest and testing by businesses
Discovery stage of public blockchain utility driven applications and services.
Whereas there has been broader acceptance of digital currencies by both retail consumers and business organizations to date, there will be a greater adoption of blockchain technology to solve real-world problems. Many applications will arise to abstract away the complexities of the blockchain to offer easy fiat-enabled gateways to the technology.
4. More investigative research
Scientists, universities and governmental bodies into the security and efficiencies of scalable blockchain consensus models.
More investigative research will be encouraged by governmental bodies, universities, and scientific organizations into the security and efficiencies of proof of work vs other consensus models.
Motivated by long-term sustainability and out of a concern for high energy utilization and carbon emissions, researchers will discover that the Blockchain Trilemma is a broken theory and that scalable proof-of-work consensus mechanisms can provide the needed balance of decentralization, security, and scalability.
5. Integration of other emerging technologies
Smart devices, sensors, IoT, IPv6, RFID, AI, and platforms that connect them
Growth in Agritech and smart farming, smart cities, and the smart-energy industry will allow an opportunity for blockchain to empower real-time, secure, immutable, time-stamped, machine to machine data and value transfer.
Upcoming legislation such as the Farm Bill may include more pro-blockchain language and sand boxes to begin testing these technologies in the field.
6. More clarification from regulatory bodies
Applicability of current property rights and securities laws when it comes to blockchain and digital assets.
Blockchain enables both physical and digital property owners the ability to record a verifiable attestation of property rights on the blockchain. This can provide proof of ownership, access to virtual goods, or a legal ‘certificate of ownership’ of physical property, e.g. concert ticket, automobile, land title, rare painting, gold bar, etc.
This is in stark contrast to the many ‘rare’ NFTs that were sold during the recent ‘APE NFT’ jpeg picture craze, which provided the purchaser no utility or value.
7. Greater access to blockchain curriculum
Education, courses, and university student engagement
There is a thirst for more meaningful blockchain education across the globe. Young students and developers are seeking the knowledge and tools to build applications that provide solutions and enable innovation.
By providing access to developer resources, students and entrepreneurs can begin to innovate and explore the utility and capabilities of an unbounded blockchain. From these explorations, solutions will emerge to conquer problems that have plagued businesses for many years.
8. Financial inclusion
Developing nations find more agile adoption and integration into the digital economy
Countries with sound economic practices that are relatively debt free and open to innovation will begin to jump the technology ladder by adopting scalable blockchain solutions. Through the utilization of micro-loans, decentralized financial services, content monetization, micro-payments, and other blockchain innovations, developing nations will more quickly realize opportunities within the global market, while bypassing the need for certain former legacy technologies.
9. Goods and services
More real-world goods and services able to be exchanged for digital tokens
For the value within a blockchain network to be realized without the frictions of legacy infrastructure, markets will begin to emerge that utilize tokenized commodities as mediums of exchange, as well as employ other blockchain powered financial instruments for efficient transactions.
This will lead to more thriving local, regional, and international digital economies as well as reduce processing and interchange fees.
10. Transaction entrepreneurism
Modern day transaction processors begin to emerge to benefit from the idea of recurring revenue
With the adoption of trustless smart contract businesses arrangements, a next generation sales model will emerge. This transactional entrepreneurism will enable businesses to offer incentivization of sales through recurring revenue generation of blockchain-based enforced payment distribution and accounting, based upon sales made and client subscriptions.
With the continued fallout and crumbling of the unregulated crypto casino markets, as exemplified by the unfortunate, recent unraveling of the FTX exchange, we will very likely see an acceleration of investment towards applications utilizing the true value of the underlying blockchain technology.
Equally we may see overzealous regulators continue to conflate digital currency and blockchain, and stifle innovation in these important areas of data integrity and efficiency.
States are now just beginning to take a sandbox approach to legislation within the digital currency and blockchain landscapes.
I anticipate many of these states will welcome blockchain while others will tend to focus on digital currency regulations. This creates a comparative shift in regional economic opportunity and varying state-by-state advancements in technology innovations.
A commonsense approach to blockchain legislation
Technology and innovation are oftentimes seen as the primary drivers for a country as well as for an organization’s next stage of economic growth.
As we rapidly transition from the big data era to a global data-based economy, the debate on the security, stability and sustainability of blockchain technologies has again taken centre stage – this time within the halls of policymakers (many of whom have only just begun their journey to navigate this complex, typically ‘tribal’ industry.)
- Do regulators have access to reliable data about blockchain technology?
- Are they at risk of falsely conflating blockchain technology and digital currencies?
- Is proof-of-work’s scalability and sustainability misunderstood?
This article was lightly edited for clarity purposes.
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