3 of the Most Influential Technologies in the Digital Economy

Long gone are the days of keeping rolls of cash under our mattresses. In our modern, mostly cashless society, we survive with all-powerful credit and debit cards and protect them with RFID-blocking wallets.

Contactless payments are only one facet of the digital economy – the corner of the global economy where economic activity is carried out online, accounting for e-commerce, digital banking, distributed computing and so much more. It’s safe to say there is a revolution unfolding before us, and we’re sitting in the front row seats. The World Economic Forum estimates that the digital economy will reach a valuation of $20.8 trillion by 2025. A whopping 40% increase from the $14.5 trillion in 2021.

With that, as we enter this new era of digital transactions, there is a rapidly growing emphasis on the capabilities of cryptocurrency and blockchain technology. While cryptocurrencies like bitcoin and ether are commonly referred to as asset classes by the mainstream, the underlying technologies of these coins are being used in many new and exciting ways.

In this piece, we’ll look at the three most influential adaptations of cryptocurrency and blockchain technology that have shaped the digital economy landscape and how they will mold our future.

1. Tokenization of assets

To simplify, the buzzword “tokenization” refers to the process of converting an asset into a digital token. This digital token is a small piece of software code that lives on the blockchain and serves as a representation of asset ownership. It can be transferred between users without an intermediary.

One use case of tokenization is real estate, where the total value of a property is fractionalized and re-distributed in tokens. These tokens allow investors to enter the market and acquire certain portions of a property quickly and at a low cost.

Put differently, tokenization can lower the barriers to entry, eliminate unnecessary fees and increase the liquidity of the underlying asset, all of which give investors much more flexibility and security with their investments.

Beyond real estate, the tokenization process can also apply to just about any asset, such as securities (shares), precious metals, intellectual property, licensing rights, ticketing and fine art.

See also: Assets Will Be Tokens (And It Will Change Finance)

2. The metaverse and artificial intelligence

The metaverse is a decentralized cyberspace that fuses the mechanics of virtual reality (VR), augmented reality (AR) and the internet. Artificial intelligence (AI) refers to the functions that allow machines (our computers) to sense, understand, think, act and learn, just as we do.

While the metaverse has a great premise to build upon, it is limited to the capabilities of current available technologies (and the lack thereof). This is where AIOps (Artificial Intelligence for IT Operations) – a subset of artificial intelligence – become a significant building block.

In short, greater investment in AIOps like big data analytics and machine learning will help build out the metaverse infrastructure needed to support additional users. This includes processing quadrillions of bytes of data per second, troubleshooting issues and restoring them, and ensuring security. Without it, it would be equivalent to navigating metropolitans without a map.

Other than AIOps, the branches of AI that are integral to the development of the metaverse are Natural Language Processing (NLP), AI Bots, machine storytelling, creative AI and interface optimization.

3. Improving privacy with Web3

It’s no secret that our data and privacy are now at the mercy of Big Tech. It is largely up to these companies to decide what to do with our data, and we don’t really have a choice but to play by their rules. This is the price we pay in order to access Web2, a term that refers to the internet as we know it today.

Web3 represents the next iteration of the internet, promising to intrinsically bring transparency, decentralization and ownership back to internet users.

At its core, Web3 is open source (anyone can modify it), trustless (no need for a third party) and permissionless (anyone can join). Simply put, it reduces the control any single party has over your data because it will be stored on a decentralized network instead of centralized servers.

In practice, Web3 technologies come in the form of cryptocurrencies, non-fungible tokens (NFT), decentralized apps (dapp), smart contracts, artificial intelligence as well as the metaverse.

Read more: How to Build the Infrastructure of Web3 With Decentralized Data and Services

Explore influential technologies in the digital economy at Consensus 2023

Since 2015, Consensus has been the place to convene and discuss the future of some of the most promising technologies in the digital economy; cryptocurrency, blockchain, Web3, the metaverse and beyond.

Join us at Consensus 2023 this April 26-28 in Austin, Texas, to dive deeper into exciting new applications of cryptocurrency and its underlying technologies. The Money Reimagined Summit is ideal for institutional and retail investors, asset managers, venture capitalists, bankers, compliance officers, lawyers, custodians and anyone interested in exploring the future of the digital economy.

Together we’ll explore rich new opportunities in the digital economy, address lessons learned from a brutal crypto winter and figure out where crypto solutions fit within the challenging post-pandemic global macro environment.