This is something that is vital for our understanding going forward.
It is easy to fall into being a fanboy and our love for blockchain. When we do this while making over the top claims, it is easy to dismiss. However, that does not mean the sentiment is incorrect.
Certainly, I fell in this category on more than one occasion. That said, it seems as things unfold, many of the affirmations are being supported.
The title of this article is a take on a headline from Decrypt.co. It was spoken by none other than Larry Fink, head of Blackrock.
It is important to highlight that Fink is not a cryptocurrency fanboy. Far from it. In fact, he is one of the noted skeptics of the entire industry. Yet, in spite of this, he sees some of the potential of blockchain. From his perspective, the entire securities industry is going to be utilizing blockchain.
This is a sentiment we expressed repeatedly. We are watching the start of a total transformation that will be taking place. The entire financial system is going to undergo change.
Of course, Fink does not believe that his business will be affected. Perhaps it will not although that view was held by the people leading Blockbuster also. Nevertheless, as we see a shift in the generations, the entire financial system will come under question.
Millennials do not think like their Boomer counterparts. How this will affect things remains to be seen. What we know is there will be a difference.
Future Of Markets Is Tokenization
Starting with markets is a great point in the discussion.
We already see how cryptocurrency and NFTs can factor into the future. While many outside the industry look at crypto through the lens of speculation, there is a solid basis for what is taking place.
Blockchain excels at recording data. At its core, we are talking about a decentralized database. When it comes to financial transactions, it is the ledger that is important.
Cryptocurrency is the way we can store and exchange value. This is nothing more than data. Yet, the data itself has the value, which means it can be sold on markets. The addition of NFTs only implements the uniqueness of an asset. So while a share of stock is no different from any other for a particular company, a piece of art is.
This is a point that was brought up in the above linked article:
This approach enables a different way to trade assets like stocks, bonds, real estate, or even alternative assets like land, wine, or art, allowing the transfers to be visible on a public ledger.
Here again, we embark upon what we covered many time. The idea of a public ledger is something that is just starting to penetrate the psyche of some. Most are not aware of the value of this. Keep this in mind when looking at something like Hive. It is not only a public ledger but also a full fledged text database.
When someone like Larry Fink says the future of markets is tokenization, which follows up on JP Morgan's assessment, we can pretty much take this to the bank (pun intended).
What we are watching the foundation being laid.
Tokenization: New Ownership Model
Where a guy like Fink is limited is the fact that he does not see new ownership models forming. At this point, he grasps the ideas of assets he comprehends being recorded in a different way. Through tokenization, he understands that it can be traded in open markets, more efficiently than the present system. All of this is right up his alley.
His view is cut short by the fact that he really doesn't see new ownership models arising. The lack of understanding pertaining to cryptocurrency is not limited to those outside the industry. Most within it allow the word currency to throw them. Considering most crypto like the USD or EURO is not how things are unfolding.
Cryptocurrency allows for the development of new ownership models. This is easy to see with NFTs. Here is a "virtual deed" to some asset, either digital or physical in nature. The one holding the NFT is the owner of said asset.
It is when we get into the fungible tokens that people get derailed. How often do people ask what can you spend it on? Another way of phrasing it is "what is the use case"? Again, this is looking at it as a currency.
Does it have the ability to operate as a medium of exchange? Certainly. The reality is that it usually falls short in that realm.
Where tokenization excels is in the idea we can have stake, an ownership piece, in an ecosystem. This could be something such as a blockchain, an individual project, or a community. The "ownership" can relate to something social in nature, an area not presently captured by the existing system. It can be of something that nobody is in charge of such as a DAO.
Here is where cryptocurrency acts as a value capture mechanism.
Fink equates that to stocks and bonds. That is something he understands. However, that is just the beginning.
We are going to see the tokenization of everything over the next decade. Value capture is going to occur in every corner of the digital world and much of the physical. Each of us is going to have our piece of the pie.
The difference is the pie will include many things that are not presently quantified and offering ownership value.
Tokenization changes all that. A fact that Fink cannot see at this moment.
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Towns and village communities will likely create their own tokens and stablecoins. Families will probably make their own. Businesses are already doing it. Smart contracts are being used to by physical goods and some can offer dividends...
The future is bright with cryptocurrencies.
It does have value capture that makes it unique. I agree in that we will see a lot of them coming out.
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Yeah, there will be people that doubt it and promote FUD, but the future really is bright for cryptocurrencies. The problem is, will the governments actually respect the people's freedom? History reveals that no. We've got to be active in our elections just as often as we are active on crypto. Vote for freedom.
If they start tokenizing, I think it's going to be a legal nightmare. As it is, I can see a ton of scams and I just wonder how things will work out. I wonder if it's just trying to digitalization of everything in the current economy.
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Saw it first on LeoFinance. And I am now seeing your post for the second time here on #VEEWS.
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It appeared on my #veews not long after I posted it. The system is quick. LOL
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This is relatable, the first thing that comes to mind is spending, and some fail to see beyond cashing out for spending.
I am looking forward to real estate tokenization taking off.
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Maybe it's just me, but the last thing I want is real estate tokenization or anything to do with blockchain.
If you've bought any property, you know first-hand how much personally identifying information goes into that process... and I don't see a way that we could tokenize/blockchain-ify real estate without also exposing personal information which most of us would never want being in any way public.
If someone figures it out, rad, but I'm not holding my breath.
Privacy is important to me as well but aside Hive is there any other crypto project out there that wouldn't have us KYCed for before using their platform?
As much as we want privacy also, we have to keep in mind the tax man is salivating over our crypto earnings until there are ways to offramp crypto without the banks, I don't see how private we can get. So I might as well tap into tokenized real estate for more passive income.
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I've been meaning to ask you if you have done an update lately on the whole Miami Coin thing. I was afraid I might have missed it and this post on how everything will eventually be tokenized made me think about it again.
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I havent really looked at it in months. I am sure it is getting crushed the same as all the other cryptos.
I havent been on citycoin lately either.
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Hmm okay. Yeah, that's kind of what I figured. I was just hoping it hasn't totally folded.
It does appear the mining of the tokens is still going on (Miami and NYC). They seem to still be updating the software per the blog on the Citycoin site.
So it doesnt seem dead.
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Thanks for doing the leg work on that! That is good to hear. I really think it is a great concept. If it can weather the bear market that could be a good indication of how viable the project is.
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I also think that future investments and money exchange will be in the Crypto world.
I will also make my investments in crypto.
Well Blackrock can take a long walk off a short pier for all the damage they are trying to do with the ESG crap.
Great deal for Blackrock. Put together ESG with the same stocks as other funds but charge an extra percent for the purpose.
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Tokenization and decentralization as a form of true ownership of something are indeed key for future developments. Just need to embed the value within it in order to ensure that any such form will thrive.
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