Blockchain is a key emerging technology in realizing the full potential of the digital economy along with other emerging technologies and paradigms such as 5G, IoT, Cloud, AI, etc.
Blockchain is very interesting in and of itself however, because of it’s potential not only technology-wise but economics-wise.
How Blockchain Disrupts Governance Models
Blockchain disrupts many economic models we have today such as shareholder capitalism in US and social-market models such as in China. Especially Public Blockchains which are open-source and hybrid or decentralized which disrupt organization models we have today with steep hierarchies to more flatter organizations and as we change the dynamics from few larger firms to more smaller firms. This is a key impact in moving from shareholder capitalism to multi-stakeholder capitalism during Industry 4.0 and the 4th Industrial Revolution as we move from the Industrial Economy to the Smart Economy.
Public Blockchains have mainly been associated with cryptocurrencies only, however they are much more expansive than just cryptocurrencies. Public Blockchains that can onboard millions of open-source developers successfully are resulting in innovation in the way organizations are built, in the way financial services are offered and in the way employees and community members collaborate to more flatter, decentralized, digitized and open-source mechanics.
They also solve several problems with current market-capitalism in which a few Big Technology Firms and a few Big Banks dominate and monopolize the global economy.
I talk about how Decentralized Finance (DeFi) aspects of Bitcoin and other Blockchains/Cryptocurrencies disrupt banking, financial services, monetary systems and central banks in my other article linked below.
How Blockchain Disrupts Big Data Monopolization
But another profound ramification is how decentralized blockchains can disrupt Big Technology companies and fix some of the negative externalities they have created which include data security, data privacy, data ownership as well as negative aspects of the gig economy which has been created as a result.
Currently, most of our data which is created every second is controlled in the hands of a few big technology corporations. While there is no doubt that big technology corporations and the monopolies that have been created have created great products and innovation for users and customers for “free”, there is also no doubt that users deserve to be control their data, own their data and have privacy that they deserve.
Now this disruption won’t all happen overnight but the innovations created from the blockchain space will have an exponential impact over time on governance models and creating multi-stakeholder capitalism and decentralization as blockchain adoption increases exponentially transferring control from large corporations to smaller businesses, entrepreneurs and developers and moving from centralization to decentralization.
Embracing Decentralization, New Business Models which don’t rely on predatory corporations can give power back to the people. Cryptocurrency, Smart Contracts, Tokenization, Blockchain and Bitcoin are great examples of a political and economy power shift back towards people.
Decentralized forms of governance can level the playing field and disintermediate political and economic asymmetries that are common in our institutions from big tech corporations to large banks and decentralize power from institutions to individuals.
Blockchains, Interoperability and the Internet of Everything
Blockchains are not separate and isolated also. Blockchains that achieve interoperability will be able to work with other blockchains seamlessly and will also connect to other key digital technologies such as 5G, Virtual Reality, 3D Printing, Artificial Intelligence, Robotics, Cloud Computing and the Internet of Things. The ramifications of the mergers between all of these components have yet to be seen but we are already seeing the connected picture of the wider digital economy that is forming. Many technologies are already connected and nested within other technologies today. Open-Source Software, APIs, and Cloud Computing have created many of these paradigms but when we see other technologies such as Edge Computing, 5G, VR and 3D Printing mature then we will start to see an even more connected picture.