Blockchain tech good, crypto tokens bad?
Direct from the desk of Dane Williams.
A look at why the mainstream media being for blockchain tech but against cryptocurrency tokens themselves, isn’t in your best interests as a consumer.
Have you noticed that the mainstream media are always receptive to the idea of blockchain tech, but clearly against cryptocurrencies themselves?
But frustratingly, never seem to ask the right questions or take the consumer oriented angle?
This can be seen in a recent CNN story that boasted: Crypto is crashing but the tech behind it could save luxury brands billions.
The story championed the idea of luxury fashion brands like Louis Vuitton and Prada forming the Aura Blockchain Consortium and using their own private blockchain solution to track their goods along the supply chain.
All without the need for those pesky, volatile tokens traded on the free market!
So with the consumer’s point of view in mind, I take a look at why crypo tokens need to exist alongside blockchain tech and why brands like LV and Prada using private blockchains without them aren’t actually solving the supply chain tracking problem at all.
Do blockchain’s like the Aura Consortium’s need crypto tokens?
The answer to the question of whether blockchains need crypto tokens entirely depends on whether you side with the corporation or the consumer.
From the consumer’s viewpoint, the entire point of these luxury brands implementing a blockchain solution was to remove the need to trust those with vested interests along the supply chain.
But what they ignore is that from the consumer’s point of view, this actually includes the corporations themselves who could still profit from the potentially substandard practices used somewhere along the supply chain that they say they’re trying to remove.
In order to remove the need to trust those with potentially vested interests, blockchain solutions are able to run on decentralised networks and use freely traded crypto tokens to make governance decisions.
You see, it’s the token via stake weighted voting in a DPoS consensus method that actually ensures on chain immutability.
Which from a consumer’s point of view, is all that matters when it comes to using blockchain to ensure the validity of the products we’re buying.
What is the point of brands who stand to gain from sub-standard practices implementing and remaining in full control of a private blockchain?
Remember, while it’s the blockchain tech that allows the product to be immutably tracked, as long as that chain’s governance is controlled by a small few, it can always be altered.
This means that if these brands are using a private blockchain with no token that allows fair, transparent governance to be conducted on chain, then we as consumers are still simply just trusting those with vested interests with full autonomy.
Making private blockchain solutions like the Aura Blockchain Consortium’s without an associated crypto token used in governance, completely redundant.
While they wouldn’t get the associated CNN media buzz around a bLoCkChAiN sOlUtIoN, these luxury brands may as well just use a database.
All that matters is that the underlying network is decentralised
I keep making this argument because the end goal needs to always be that no single bad actor can take control of your network.
Whether it’s permissionless money itself or like we see here, a permissionless network that takes control away from the brands themselves, an underlying network that makes this possible is all that matters.
The Aura Blockchain Consortium shouldn’t create their own blockchain to track and ensure the quality of luxury goods throughout the supply chain.
They should use a truly decentralised, battle tested network featuring a token distribution that offers security and open blockchain governance.
By instead using the Hive blockchain to implement their solution, consumers could actually trust that the entires made at each stage along the supply chain are immutable and censorship-resistant.
Outcomes that in its current private blockchain form without a crypto token for governance, they can’t offer.
Best of probabilities to you.
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