Lưu trữ cho từ khóa: innovation

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The perks of the world where 40% of the adult population owned crypto | Opinion

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In June, Security.org published findings that raised quite a few eyebrows around the crypto world. Their new data found that 40% of American adults now own crypto, up significantly from last year. Even more, it seemed like a sustainable increase. Crypto ownership among women has spiked, and a huge chunk (21%) of non-owners are more likely to invest after the approved US Bitcoin (BTC) exchange-traded fund.

There are some caveats to remember here. This data is based on two relatively small surveys (1,001 and 504 people, respectively) and may misrepresent the entire US population since they were done online. The Federal Reserve listed just seven percent of US adults as crypto investors in 2023, with a much bigger sample size. However, their data, too, might be misrepresentative, given that the respondents were selected from only those who agreed to participate in Ipsos’ KnowledgePanel.

Whether or not the Security.org number is realistic, it has got me thinking. What if 40% of the world’s adult population (about 5.75 billion people) owned crypto, not just the US? This idea has been rolling around in my head for a couple of months now. It both baffles and excites me. Here’s what I’ve come up with.

There would be four major categories of change:

●  Individual economics.

●  Financial systems.

●  Technological and social patterns.

●  Environmental policy.

Come along with me for this thought experiment. One that might not be all that far-fetched is the way things are going.

Individual economics

One of the most touted benefits of cryptocurrency is its potential to provide financial services to the unbanked or underbanked.

Take the Philippines for example. Despite 66% of their population being unbanked, crypto usage is rising. Over 13% (or nearly 15.8 million people) own crypto, and the government is rapidly pushing to release a central bank digital currency to keep up with the demand.

Over $33 billion in cash remittance is sent home from overseas Filipino workers, another perfect use case for crypto. Traditional banking systems, often inaccessible or inconvenient for citizens in developing regions, will find a formidable competitor in blockchain-based financial services if adoption continues to increase.

Crypto could serve as a financial equalizer, bridging gaps that have long excluded vast populations from economic participation.

Volatility and risk

Cryptocurrencies are infamous for their volatility, which might pose a significant risk for the underbanked. But if as many as 40% of the world were invested, that volatility would likely decrease. As more people participate in the market, the liquidity of crypto assets would increase, making it harder for any single transaction—even from whales—to dramatically affect prices.

A more widely held and traded asset tends to have smoother price movements, as the effects of large buys or sells are diluted. As the adoption rate increases, we can anticipate that cryptocurrencies might stabilize (to some extent), making their value more predictable over time.

Investment patterns

With nearly half the adult population holding crypto, traditional investment paradigms would shift. A significant portion of personal savings could be directed toward digital assets rather than conventional investments like stocks or mutual funds. Diversification would have a whole new meaning; traditional portfolios would include a mix of equities, bonds, and digital assets.

Financial systems

The massive shift in investment patterns would inevitably disrupt traditional financial markets. With so many people not invested in digital assets, a considerable portion of capital that might have been funneled into traditional stocks and bonds would instead flow into the crypt ecosystem.

This diversion could result in liquidity challenges for conventional markets, increased volatility, and shifts in valuations as investor attention is divided. IPOs would likely be structured differently, with some companies offering ICOs either as a replacement or in support of their public offerings.

Crypto integration

However, not all the effects will be negative. The increased demand for crypto-based investment opportunities would lead to greater integration with existing structures. We’ve already seen the beginning of this with the approval of several Bitcoin ETFs, which provide a regulated, familiar pathway for traditional investors to gain crypto exposure. These financial products would become normal—even mundane—as mainstream adoption rises.

Regulation and policy changes

However, for mainstream adoption to be possible, regulatory adjustments would be necessary. We’ve already seen some notable developments in this area. For instance, Senate majority leader Chuck Schumer recently pledged to push crypto regulation through before the end of the year. Legislation ensuring investor protection, curbing market manipulation, and fostering innovation would likely emerge all over the world. Policymakers would be compelled to work with the private sector to develop frameworks that both allow crypto to flourish and ensure it doesn’t undermine overall financial stability.

Digital payment expansion

Some of that legislation would have to address the explosion of digital payment options. Recently, a bipartisan bill was introduced by Senators Tedd Budd (R-NC), Kyrsten Sinema (I-AZ), Cynthia Lummis (R-WY), and Kirsten Gillibrand (D-NY) to remove the capital gains tax on small crypto payments. If successful, this type of legislation would set a precedent, encouraging more countries to follow suit and integrate crypto into their everyday economies. Imagine paying for your morning coffee or splitting a dinner bill without worrying about the tax implications.

Technological and social patterns

As crypto usage increases, blockchain innovation also increases, with new use cases being created every day. From supply chain management to healthcare, distributed ledgers can help increase transparency, security, and traceability.

Digital identification and trust

Governments all over the world are exploring digital identification, though too few are including blockchain technology in their initiatives. If crypto continues to thrive, blockchain-based citizen authentication will be a natural byproduct. Digital IDs on the blockchain can significantly reduce fraud, streamline transactions, and enable secure, authenticated access. Your ID would be universally recognized, securely stored, and irrefutable with the help of identification layers from companies like Concordium.

Social implications

For it to rise to 40% or more, trust must be placed in the technology itself rather than in human institutions. For many, that shift requires a leap of faith. Peer-to-peer transactions could become the norm, reducing reliance on traditional banking. The younger, tech-savvy generation would lead this transition, driving innovation and new business models. But it could also exacerbate digital divides. Those without access to the internet or technological literacy may find themselves further marginalized. Policy and educational programs would need to be created to promote inclusive access to new financial systems.

Environmental policy

One of the most pressing issues surrounding the widespread use of crypto is the environmental impact. Major tokens like Bitcoin (BTC) operate on a proof-of-work model, which requires extensive computational resources and, consequently, a large amount of energy. The Environmental Working Group has been vocal about the need for change through their “Change the Code, not the Climate” campaign, advocating for Bitcoin to move away from PoW to less energy-intensive models like proof-of-stake.

However, the environmental story isn’t just doom and gloom. Crypto and blockchain tech also offer promising avenues for advancing green energy initiatives. Peer-to-peer energy trading, where individuals can buy and sell their renewable energy directly to and from their neighbors, could reduce our reliance on traditional sources.

Final thoughts

There’s still a lot of change to come if we want widespread cryptocurrency adoption. None of it is possible without a thoughtful, well-rounded policy that supports innovative technology.

I’m hopeful that the recent developments in the US and ongoing public pressure in the EU and the UK will force lawmakers to realize that the public wants—and deserves—robust, supportive crypto frameworks instead of endless restrictions.

Tổng hợp và chỉnh sửa: ThS Phạm Mạnh Cường
Theo Crypto News

NFT

Tokenizing agricultural trades will transform global food chains | Opinion

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Agriculture, the bedrock of human civilization, faces unprecedented challenges in the 21st century. With climate change threatening traditional farming practices and the global population expected to reach 9.7 billion by 2050, driving a 51% increase in food demand, the development of new and innovative solutions to help improve the industry is imperative. 

The tokenization of agricultural trade has emerged as a promising solution to many of its most modern challenges. Many tokenization projects have focused on fractionalizing illiquid assets, also known as real-world assets (RWAs), enabling buyers and sellers to transfer ownership faster.

However, there is a common misunderstanding that tokenization is synonymous with fractionalization. Tokenization refers to the process of converting something of value into a digital token usable on a blockchain. For instance, we could tokenize the Mona Lisa as an NFT, representing the entire artwork as a single digital token. Alternatively, we could tokenize and fractionalize the piece of art and allow multiple people to own a part of it in the form of NFTs.

These two approaches address different issues. The former, tokenizing the art as a single NFT, deals with the ownership of the asset and enables easier transferability. You don’t need to put it in an auction house and pay exorbitant fees to lawyers to transfer ownership—you simply need to transfer the NFT to transfer the legal ownership.

The fractionalizing of the Mona Lisa addresses liquidity issues associated with the painting’s price. Since the Mona Lisa costs hundreds of millions, fractionalizing it allows multiple people to purchase shares of it and be bound to its future success. This also provides them with the opportunity to easily buy into and sell out of the asset.

We don’t need to tokenize the underlying assets in agriculture as they’re already divisible; the holy grail is to tokenize the contractual agreements themselves. The benefits of tokenization for farmers are clear—instant settlements of contracts, the removal of unnecessary documentation, and a unified legal structure to the underlying trade process. A great deal of the current cost and friction in traditional agricultural systems is in transacting between jurisdictions—blockchain-based transactions will simplify this.

In the coming years, more marketplaces will leverage blockchain technology to tokenize agricultural trade. This shift is driven by the complexity of legal contracts, which can be simplified through smart contracts. These contracts will unify and automate underlying processes, removing friction and resolving issues efficiently—this will enable farmers to focus on what they do best. 

The challenges facing agriculture

The agricultural sector is fraught with challenges that make it insufficient and unfair for stakeholders within the supply chain.

According to a study, a 350g four-pack of supermarket beefburgers priced at £3.50 sees the beef farmer incurring high costs of 90p but receiving a profit of only 0.03% (0.1p). In contrast, with similar costs, the processor earns ten times the profit (1p), and the retailer earns 70 times the profit (7p). This pattern is seen across the sector: for a pack of mild cheddar, the farmer receives 0.02p, for bread, 0.01p, and for apples, just 1% of the retail price. 

One major reason for profit disparity is the fragmented nature of the supply chains requiring multiple intermediaries. Blockchain applications are streamlining these processes by automating transactions and reducing friction for and with intermediaries, thus lowering costs and increasing transparency. Furthermore, inefficiencies and a lack of transparency in the supply chain can lead to disproportionate profit distribution, with farmers often at the beginning of the supply chain bearing a disproportionate amount of risk for the reward they receive. This disparity highlights the need for improved market platforms and better support systems for farmers to ensure fairer profit distribution. 

Solution through innovation

The tokenization of agricultural trade will play a crucial role in creating more transparency and efficiency in the supply chain. This will ultimately provide farmers with a fairer share of the profits and end users with cheaper products.

The agricultural industry needs a blockchain-based real-world assets marketplace to bring the $2.7 trillion agricultural trade on-chain. Immutable ledger technology brings a layer of verified trust to a system that has used papers and pens for too long. Settlement has relied for too long on archaic banking channels, and finally, access to markets has been riven by unnecessary additional hands.

A new blockchain-based system would enable instant settlement of transactions, with fees of only 0.15% for each side of the trade. This is in stark contrast to traditional systems, where fees can be several percentage points per trade.

For example, Oldenburg Vineyards, one of the biggest wine producers in South Africa has recently settled one of the first agricultural trades on Solana. Adrian Vanderspuy, owner and CEO of Oldenburg Vineyards, stated:

“We settled the first-ever trade on a public blockchain, and it is now on its way from South Africa to London. The funds came into our account in seconds rather than days, and the fees were £5. We look forward to continuing our partnership and bringing more of our stock on-chain. This will help us to reduce transaction and remittance costs, as well as the time it takes to receive payments.”

Stories like the above are just the beginning of the agricultural trade revolution.

The road ahead

As we face the challenges of feeding a growing population, reducing food waste, and ensuring sustainability, tokenizing RWA trades offers a compelling solution. By leveraging blockchain technology and its ability to provide decentralized transparency and lower the cost of transacting, we can address the inefficiencies of traditional supply chain systems. This approach promises a new era of efficiency and accountability in agriculture, ultimately helping to secure a sustainable future for global food production.

Additionally, enhancing transparency is a key benefit of the tokenization of agricultural trade. Blockchain technology ensures that all transactions are recorded on an immutable ledger, providing transparency across the supply chain. 

This can help reduce fraud and ensure that farmers and end-users receive fairer prices. Blockchain’s primary attributes—traceability, immutability, and provenance—promote transparency in supply chains. Farmers urgently need these blockchain properties to secure fair remuneration for their work and sustain their efforts to feed the growing global population.

Tổng hợp và chỉnh sửa: ThS Phạm Mạnh Cường
Theo Crypto News

Công nghệ

Applying blockchain to good causes is a must | Opinion

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It’s a sad fact that a disease such as AIDS still carries a stigma that can all too often prevent people from seeking help, information, or treatments that could prevent its spread. Although decades of campaigning and medical research have ensured people in advanced democracies can access regular testing and medications that ensure HIV is barely detectable, other parts of the world aren’t as fortunate.

Last month, at AIDS 2024, the 25th International AIDS Conference in Munich, a number of charitable and medical organizations came together to discuss how the current donation model can be improved so that issues related to privacy, costs, and efficiency aren’t the barriers they currently are.

Take, for instance, the case of a young man in sub-Saharan Africa who might be a member of the LGBTQ+ community and have concerns that talking to doctors or official bodies could lead to people knowing about his status. Even if the doctor he talks to respects patient confidentiality, medical records can be misplaced, and cyberattacks can see personal information leaked to third parties, which would understandably be a genuine deterrent. 

Blockchain as a solution

The Elton John AIDS Foundation has recently started a new donation model using the Partisia blockchain technology that enables smart contract technology to automate the release of funds based on predefined conditions. This ensures money is used as intended, reducing the need for operational oversight. It also eliminates the need for intermediaries, and distributed ledger technology provides transparency whereby every transaction is recorded, reducing the need for third-party auditors to verify that funds have been received and spent as intended. 

In addition to transparency, DLT can facilitate peer-to-peer interactions between donors and recipient organizations, eliminating traditional intermediaries such as transport companies, operations managers, and distributors, who understandably need to be compensated for their time. The elimination of intermediaries can also go hand-in-hand with reduced administrative costs associated with managing and distributing funds, allowing more money to go directly to the intended causes. The elimination of these intermediaries will inevitably make some people worse off as their jobs are no longer required; however, it will create a more streamlined process for donations to be made to those most in need.

More importantly, it enables people to maintain privacy and anonymity where previously it wasn’t possible. Using the blockchain enables people’s identities to be hidden behind a series of letters and numbers that the user controls and are unidentifiable. Granted, there are issues related to the user experience, such as miscopying long addresses or losing the all-important passphrases; however, it does provide a fundamental portal for people in need looking to receive aid. As of 2021, around 78 percent of people in Eastern and Southern Africa living with HIV were on antiretroviral treatment. However, access to antiretroviral treatment can vary drastically by country. New technologies and approaches have the potential to address the current lack of access some people face. Although HIV is usually associated with certain at-risk groups, such as people who inject drugs, men who have sex with men, and sex workers, these groups do not account for the majority of new HIV infections in Eastern and Southern Africa. In 2021, around 54 percent of new HIV infections in the region were among the population outside of these key risk groups.

Distribution of new HIV infections in Eastern and Southern Africa in 2021, by population group | Source: Statista 

AIDS is just a disease and can impact anyone; however, prejudices and antiquated thinking have created a toxic legacy whereby people needlessly continue to be infected and die prematurely. Now is the time for fresh thinking on how we tackle this crisis and harness new technologies to educate, empower, and connect people with the resources that would previously been unavailable to them. 

Blockchain is often criticized as a solution in search of a problem or the solution to all problems; although some of its proponents can be overly zealous in their proselytization, its application has enormous potential in regions of the world that have traditionally been excluded from technology and services we take for granted in the advanced economies. Now is the time for policymakers and charities to take a more imaginative approach to how they tackle long-standing problems that have held back progress for decades. Blockchain technology has the potential to eliminate problems related to costs, friction, privacy, and data security. Now is the time to put it to use; the consequences of inaction are simply too high.

Tổng hợp và chỉnh sửa: ThS Phạm Mạnh Cường
Theo Crypto News

NFT

From views to value: The future of blockchain innovation in social media | Opinion

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The age of direct-to-consumer is here in all aspects of the game. The $250 billion creator economy isn’t immune to this change either.

For long, traditional social media platforms have acted as gatekeepers of revenue flows, limiting ways in which creators, their followers, and unassuming advertisers engage with each other.

After seeing multiple web2-based iterations fail to balance these three pillars, it would seem the future is rightfully leaning toward web3 to democratize social media.

Empowering creators, users, and advertisers

According to a report from Mordor Intelligence, the impact of blockchain in the media, advertising, and entertainment market is expected to soar to $27.29 billion by 2029, at a CAGR of 78.49%. This transformation, which we are witnessing live, has been made possible with the emergence of defi integrations, which cut out the middleman and lay the groundwork for a new era of creativity, engagement, and trust. 

From offering solutions to dated problems like digital piracy, skewed royalty distributions, and monopoly of user data, blockchain tech is now finding rampant use in redefining human interactions. It starts with empowering creators, without whom such platforms become just another community chat center.

By thinking beyond brand engagements, SocialFi platforms are helping create a model where loyal, paying communities sustain creative livelihoods. While existing solutions focus on only the creator, the other two legs of the system — users and advertisers — can no longer be ignored. 

Here is where a tokenized ecosystem comes into play. By enabling creators to earn directly through audience engagement and rewarding every user for their digital footprint, SocialFi’s next phase should create mutually rewarding processes for everyone involved. This approach not only democratizes earnings to ensure creators are compensated fairly but also boosts user engagement by blending the interests of creators and their audiences. 

Additionally, advertisers who are part of this ecosystem have greater control over their spending, getting to engage better with the entire user spectrum and thus projecting better returns on their investment.

NFTs for digital ownership

A few years ago, NFTs appeared with a bang but quickly sobered down as hype clouded their real-world applications in tokenizing digital assets. That being said, the sector continues to see healthy funding as investors bet on its applications in industries like art, real estate, photography, music, and social content — in essence, a connection with RWA.

We’re increasingly seeing that merely making content decentralized isn’t enough. There needs to be a way to stamp your IP on it, and monetize forever. In this regard, NFTs enable creators to have true ownership with the added prospects of merchandising and recurring revenue. 

Another point to consider is the emergence of short-form visual content as the most popular form of content on the internet today. Despite their popularity, copyright violations and lack of creator credits disregard the efforts of digital participants. By offering genuine scope for visual content to be instantly converted into NFTs, SocialFi platforms can add a layer of transparency and monetization, previously untapped. 

Despite such inherent potential, integrating blockchain into the media industry is not without its challenges. Issues like scalability and interoperability aren’t new, and much rides on emerging low-code solutions that enable developers to build scalable L2s, more effectively and at lower costs.

Several networks, like Sui, for example, provide a robust on-chain development environment and equip platforms with high throughput—a crucial factor in media applications that demand high transaction speeds for optimum user experience. 

Building on-chain also ensures that decentralized and mainstream fintech tools can be plugged into a common ecosystem. Not to mention the preservation of intellectual property and thwarting cyber attacks by governing such platforms on-chain. All these factors are especially useful for seamless real-time payouts, including for micro-payments, which traditional fiat based transfers cannot service due to high transaction costs. 

The complexity of web3 interfaces may be its biggest impediment for now, but with newer platforms incorporating the familiarity of web2 with the flexibility of defi, the opportunity to bridge two different worlds has never been more achievable. 

Tổng hợp và chỉnh sửa: ThS Phạm Mạnh Cường
Theo Crypto News