Networked Economies: The Inclusive Future
We all heard about tribalism in cryptocurrency. There are the Bitcoin Maximialists who believe that Bitcoin will be the single currency of value and everything else is trash. Of course, the challenge with this is that the "winner take all" mentality is deeply ingrained in us.
In a world of scarcity, competition is the main characteristic. For me to win, someone else has to lose. After all, there is only so much to go around. Hence, with resource distribution inevitable, there are going to be some winners while others lose.
It is a mindset that needs changing. As stated repeatedly, we are entering the Age of Abundance. This is due to the fact that the digital component to our lives is only growing. Therefore, we are operating in a realm that is near infinite. Resources are no longer scarce. Digitization means commoditization. This means that prices plummet with access being opened to more people.
The Digital World
This is a world that has no borders. It is not physical hence not subject to the Newtonian Laws of Physics. We can see how one can be interacting with one in Bangladesh one moment and another in Buenos Aries the next. This is obviously not possible in the physical world.
We also see how the borderless nature makes regulation very difficult. When something operates in this realm, it is impossible to determine where a transaction actually took place. Is it where the server resides? Could it be the point of origin? Destination? Where does this get applied to?
These are questions that are not present in the physical realm. At the same time, even though we are more then 25 years into this, there are no concrete answers. The challenge is we are dealing with entities that were not designed for this arena.
Cryptocurrency is going to be of great impact. Since it was designed in the digital world, it also knows no borders. Transactions can take place anywhere, between any two parties. There is no need for a centralized entity to be involved. Instead, we simply can operate on a node-to-node basis. It is like communicating via Walkie Talkie except on a global scale and at rapid speed.
Therefore, we need to embrace the fact that we are seeing a complete transformation of how our world operates. As we delve deeper into this arena, a major paradigm shift will be taking place. This is something that most of society is unprepared for.
Presently, much of our activity is still broken down on a geographic basis. We see reports published detailing how the economy of the United States, the EU, or China is doing. This is comprised of the economic activity that occurs within those borders. Products that are exported are accounted for by determining where they originate from. It is a tidy system that makes things simple.
Of course, as evidenced, we see the simplicity eradicated when we start to look at the digital world. This poses a host of issues that muck up the nice accounting process.
This is not a problem other than for the fact that people are trying to maintain the same system. It is the lack of willingness to change that is the main challenge.
In the digital world, physical location means very little. For operations to take place, where one resides is of no importance. Gamers sign on from all over the planet, engaging as if they were sitting next to each other. Digital downloads can occur anywhere an Internet connection resides. Where the device is located when downloading a song from ITunes does not matter to Apple™.
Hence, we are moving towards a future whereby economies are not based upon geography but networks. This means that what digital ecosystem is more important than the old system of where one is located.
Certainly, we will see interoperability. However, ultimately we are going to see different layers comprised of networks were all kinds of transactions take place. This could be in the form of digital commerce, gaming, social media, and a host of other alternatives. The "rules" of the network are going to be a lot more important than those of physical governments.
Inclusion For All
A great deal of one's plight in life is determined by where he or she is born. Geographic region still means a lot. Those who are lucky enough to enter the world is a developed country stand a much better chance of success than one who is from a third world nation. We essentially see a global caste system based on geography.
In the digital world, all of this disappears. With the development of blockchain, we see decentralized, open, permissionless networks arising. This means they are open to anyone in the world with an Internet connection. Since that is presently over 5 billion people, that covers a large percentage of the human population.
When we operate in a world where anyone can participate and all activity is monetized, we see one where distribution takes a much wider turn. Instead of only a small percentage of the human population able to engage financially, anyone can. It only requires logging on and participating.
The early pieces are already being put in place via the cryptocurrency/blockchain development. We are seeing permissionless networks with more applications being added. Since account ownership is provided to the individual, at the core level, nobody can be excluded. This is a marked difference from what our present economy offers. That sees most of the population excluded.
With each new development, we see abundance increasing. There is essentially no limit to where this can go. As we make further advancements in areas such as energy, computation, and software architecture, this is only going to expand.
Therefore, it is fairly easy to see how networked economies are our future. We also witness how inclusive it is.
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