The ability of blockchain technology to decentralize control of our financial economy is well documented. It’s one of the foundations of the technology, and Satoshi Nakamoto’s (BTC) Bitcoin Genesis block contains a reference to the 2008-2009 financial crisis: “The Times January 3, 2009, Chancellor on the verge of a second bailout for banks”.
The news, never explicitly published by the creator of Bitcoin, comes from the headline of an article in the London Times on January 3, 2009 listing the banks bailed out by the UK government. According to Nakamoto, Bitcoin is a means of reforming this corrupt and inefficient financial system in order to create a fairer and more democratic financial system..
So,What would Nakamoto say about the current state of the blockchain and crypto industry?? Increasingly, institutions rather than individuals seem to be gaining control over the means of production in the blockchain sector.
Facebook’s announcement of Libra’s plans, Your digital payment platform, In the middle of last year it was the first public icebreaker for many. The reality, however, is that many governments and institutions from a number of sectors – including Walmart, JPMorgan Chase, and PayPal – have been tacitly building blockchain operations and capabilities for several years.
The latest decision by the Office of the United States Currency Auditor The permission from nationally licensed banks in the US to provide cryptocurrency custody services is another important assertion of cryptocurrency legitimacy.This is likely to spark a race between financial institutions to create or acquire secure custody solutions.
Such centralization seems to contradict the vision of a just and democratic financial system that Nakamoto and the Cypherpunks Original. Critics condemn the end of the decentralized blockchain utopia as governments and institutions adopt the technology, but the situation is much more complex than black and white reading would allow.
Instead of institutions fundamentally contradicting the democratic ideals of crypto, I would say that they are really essential to making this vision a reality. The entry of centralized institutions into the crypto-economy cannot in itself be a blow to their values. While public trust in centralized institutions in countries like the United States may be historically low, these institutions are not inherently malicious or corrupt in nature. The same contrast applies to decentralized organizations: they are not inherently trustworthy or morally responsible agents. Numerous scandals in the cryptocurrency industry related to wallet hacks, fraud with initial coin offers and dubious projects show that this is often not the case.
Institutional adoption of blockchain can bring tremendous benefits to the entire blockchain ecosystem: Is a Key step in the development of the sector that can significantly expand acceptance From a limited cohort of tech-savvy users (limited by gender, age group and location) to markets with a truly global demographic reach that the broken cryptocurrency industry in its current form cannot reach.
Be clear Decentralization and democratization remain the ultimate goal in this case. Really decentralized control often comes from the roots of centralizationand to get to this next phase of the sector, a phase of centralization is required first.
The same path shows up on the internet. A significantly decentralized service was introduced in its early stages in the 1990s. Today, centralized control of web services has been introduced worldwide by companies like Google and Amazon. With legislation focused on protecting user data and the growing public appetite to limit the influence of large tech companies, the balance of power seems to be shifting increasingly from institutions to institutions.
What The key to the success of the transition will be getting institutions onto the blockchain in the right way. Interoperability should be a fundamental part of this transition. The variety of protocols developed by different agents and institutions is net positive for the market, but only if these protocols allow some degree of system interoperability. This allows users and developers to innovate the various protocols and choose new services with few barriers to entry.
A considered and measured approach to institutional takeover, how it happened, This also makes the transition easier by consolidating blockchain use cases. The distributed ledger tech industry has been unduly obsessed with studying every technology use case imaginable, from the crypto city of Akon to the marketing of time itself.
Large companies and institutions will ensure that value-based use cases become the norm of technology and no unnecessary import and unsuitable for projects with the superficial purpose of raising capital or making headlines. Specific use cases are now more consistentPayouts are a likely candidate to begin with Cool projects like Libra, Celo and Polkadot are firmly established in space.
The institutional making of blockchain technology to a mass audience shows a new type of user involved in the technology: one with little or no interest in the technology.. Such an acquisition will be a barometer of the technology’s true success. Blockchain is one of the various new technologies that society has. When we finally stop talking about blockchain as a notable aspect of a service in and of itself, we will know that it has become an integral part of the general use of technology.
Make no mistake: the institutional blockchain adoption is here and it’s here to stay. The question that remains is How can we ensure that this adoption process preserves the democratic spirit of technology for the masses?.
This will certainly be a challenge, but one that the blockchain sector can more than handle.
The views, thoughts, and opinions expressed herein are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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