CES 2020 Digital Money Forum: The Future of Digital Assets
CES might be behind us but the future of digital money and tokenization is getting clearer with each passing moment. It is after all the dawn of a new decade and all that survives must evolve.
I jetted to Las Vegas early Tuesday morning, about a week ago, to spend the day attending blockchain conferences at the Venetian to hear what the leading experts of cryptocurrency and blockchain had to say about how digital currency is evolving based on today's world. Among the panels was an info-packed discussion led by Michael Terpin, founder/CEO of Transform Group about the future of tokens and digital assets, also highlighting some of the startups that are shaking up the industry with innovative solutions to existing problems in cryptocurrency.
It is a universal truth: when you say crypto, they say Bitcoin. The two are synonymous around the world yet alt coins such as Stellar, Ripple, Dash and temtum are improving on the bitcoin protocol addressing key issues in scaleability, sustainability, security and slow transaction times. Andreas Antonopoulos, a name most crypto geeks know well, and whose course I took at the University of Nicosia's Blockchain Initiative, said he believes the future of digital currency will comprise of “many coins, one chain.” This would mean that in the near future you’ll be able to fork and create new coins to your liking, the market itself will define what is successful, while new coins will all be interoperating.
In the Marshall Islands, the Government has its own own sovereign cryptocurrency while the Government of Bermuda has begun accepting payments in USD Coin (USDC) “for taxes, fees and other government services.” Their respective Governments are not only regulating digital currency but are also becoming the game-changers of the market stopping just shy of claiming “we are cryptocurrency.” It is becoming more and more evident that stable coins are going to be based on assets, such as gold as well as the USD. Sovereign banks will be placed on their own blockchain. Bitcoin has proven over and over again that it functions best as a "store of value" because of the scaleability issues it faces (low capacity transaction throughput, not easily available for everyone to use.) Alt coins are being created each day that promise faster transaction times, as mentioned above, Dash, Ripple, Stellar and temtum all represent advancements.
Stablecoins such as Tether USDC (backed by USD,) PAXOS (gold backed,) AND DAI (backed by ethereum) are what we should expect to be seeing more of in the near future together with corporate digital assets. China's Central Bank is in the process of testing a new digital currency after Facebook announced Libra last year. The digital yuan is expected to function similarly to its paper cousin than a cryptocurrency such as Bitcoin. Its value is tied to the regular yuan, so it's expected to be relatively stable. The possibility does, then, exist that China's new digital currency could likely rival the USD as an international means of payment. "China is moving quickly to launch a similar idea (as Libra) in the coming months," Zuckerberg told a House committee in October. "If America doesn't innovate, our financial leadership is not guaranteed."
Enterprise tokenization use cases will take the near future into private stocks built on public blockchains offering better privacy and decentralization as well as more user-controlled data. Asset creation such as crypto kitties and WAX and several other digital collectibles will be part of global culture, growing as fast as social media did. So where does this leave funding? As things stand at the moment, regulation is murky and it's up to the governments to figure out how to preserve and promote innovation while protecting investors.