Crypto's New Frontiers

The Spatial Web

The wider advancements in digital technology and communication, combined with the nature of blockchain technology, mean the space tends to move incredibly fast. So fast that it can be very hard to keep up.

Developments in Artificial Intelligence, Augmented and Virtual Reality, Internet of Things (think smart cars, robotics and biometrics), as well as 5G networks, 3d Printing and GPT-3 are all beginning to converge along with the blockchain space. These developments have been dubbed web 3.0 but are also known as The Spatial Web.

To get any real sense of where the blockchain industry is heading, we can’t just analyse it in isolation. We must also assess how it will interact with other technologies and what innovations these interactions might lead to.

Decentralised Finance

DeFi is an umbrella term for various financial applications using the programmable aspects of cryptocurrency - via smart contracts - to innovate wealth management.

The key innovation here is that financial instruments built on blockchains do not rely on intermediaries such as banks, brokerages or exchanges. This has many advantages.

Providing new access to finance for the unbanked population estimated to be over 1 billion people. Generating access to a new forms of yield. Enabling innovations such as decentralised stablecoins and synthetic tokens. Removing the barriers to entry for early stage investment.

The main criticism of DeFi is that blockchain transactions are irreversible and so incorrect transactions cannot always be easily reversed. Regulation is also tricky to the decentralisation and private nature of the industry.

One key area of regulation is CBDCs. Central Bank Digital Currencies are currently heavily researched by 80% of the world’s central banks, and the people’s Bank of China is currently trialling their digital Yuan. CBDCs aren't necessarily a direct challenge to DeFi but governments playing catch-up to the innovation that DEFI is unleashing.

They are hybrids that cherry-pick the elements of crypto that governments find useful - traceability and money supply control - while ditching those that challenge its role - permissionless and borderless.

Decentralised Autonomous Organisations

Decentralised Autonomous Organisations or DAOs are organisations powered by smart contracts represented by the organisation members’ rules and not influenced by central governance.

DAO’s are challenging long-held beliefs around company organisation and democracy. They remove the need for mutable acceptable, trusted third parties to enable transactions. This makes transactions more straightforward and more efficient, but leaves the problems of human motivation.

Non-Fungible-Tokens

Non-Fungible-Tokens or NFTs are a specific type of cryptographic token based on blockchain technology. In contrast to Bitcoin or other cryptocurrencies that are fungible - can be freely exchange for other tokens - NFTs represent something unique and are thus not mutually interchangeable.

NFTs are used to provide digital scarcity and power applications that facilitate the digital trade of art, collectables and other digital items. NFTs can represent in-game assets controlled by the user and can be traded on third-party marketplaces.

Web 3.0 And Blockchain’s Interconnected Future

Web 3.0, aka The Spatial Web is a set of developments across different technologies becoming increasingly interconnected. Blockchain technology is one development; also included are Artificial Intelligence, Augmented and Virtual Reality, Internet of Things, 5G networks, 3d Printing and many more.

Distributed Ledger Technology provides the power for this interconnected infrastructure. Blockchain’s offer a way to securely, reliably store data in a decentralised fashion. Blockchains offer a path to a virtually unhackable, globally shared ledger of records, events and transactions.