The world is at the beginning of the digital revolution, and innovations are disrupting our ability to do everything from using tools and devices to financial transactions.
New Active Classes
The digital economy is growing rapidly around the world. The existing digital economy is characterized by the creation of new asset classes and the digitization of traditional assets. Emerging technologies such as blockchain, artificial intelligence (AI), Internet of Things (IoT) and 3D printing play a key role in driving this growth.
New technologies have the potential to dominate the global economy in the future. For example, there are virtual coins and tokens in the blockchain, the popularity of which has grown dramatically in a short time.
Great players in the game
Blockchain allows users to perform transactions more securely and faster than traditional methods. The features of the blockchain have attracted many prominent technology and financial companies, including IBM, Oracle, JP Morgan Chase and Boeing. For example, IBM recently teamed up with financial technology company Stronghold to introduce a dollar-backed cryptocurrency called Stronghold USD. This virtual currency is an example of how a consumer’s trust in a traditional asset (in this case fiat-currency USD) is used to support a digital asset.
There are also examples of companies combining two new technologies to provide solutions for the future. Aerospace giant Boeing recently announced that it is partnering with artificial intelligence company SparkCognition to develop traffic management solutions that use blockchain for unmanned aerial vehicles.
Asset tokenization is not limited to traditional assets such as currency. The new market can use the intrinsic value of various assets to provide security labels. Blockchain can be a distinguishing factor between security labels and traditional securities. The use of smart contracts in blockchain eliminates the need for an intermediary and thus reduces transfer costs. This use of the blockchain has the potential to significantly affect the traditional banking system. Because all assets are liquid, readily available, and separable, they can eliminate the need for money as an average exchange.
Automation and artificial intelligence have already left their mark on many markets. Trading algorithms have overtaken human traffickers. In the manufacturing sector, machines have taken over much of the work previously done by humans.
We need a new framework
In this rapidly changing economy, it is no longer possible to rely on traditional models and decision-making methods. It is important that we develop a new framework to keep up with new developments such as DAO, AI, VR, P2P and M2M. In other words, we need to go beyond Munger’s Mental Models and focus on digital models such as network theories and exponential growth models.
The digitalization of our economy is progressing rapidly. Over time, we will have a clearer idea of what developments will dominate this new Web 3.0 economy, but it is clear that this economic revolution is happening on a global scale.