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Many average crypto enthusiasts and investors may not be aware of the “blockchain” and DLT names associated with enterprise use.
That’s because the technologies and networks built on Corda, Hyperledger Fabric, and a handful of other major enterprise class DLT systems are private, permissioned, and not made for or marketed for individuals.
But those solutions, and the companies and groups of companies that have been utilizing them for years—commonly called consortiums—are beginning to feel the squeeze of Web3 and its advantages.
Fast evolving technology by start-ups in the insurgent cryptocurrency blockchain sector can’t be ignored by corporations, say industry analysts.
That means, in one way or another, corporations will have to migrate to new DLT functionality that is building out things like:
- interoperability between systems
- tokenization of info and assets
- automated processes and community decision-making (via DAOs, or Decentralized Autonomous Organizations)
- “identity” data ownership by individuals and not corporations;
- and even more transparency with regard to transactions (while still preserving necessary anonymity)
Some industries, including gaming, social media, music and art, and promotion are obviously being impacted by technology built on permissionless, crypto-incentivized public blockchains like Ethereum, Solana, Algorand, Cardano and others.
Users of these networks want things like interoperability (for example, the ability to use assets like crypto tokens and Non-Fungible Tokens or NFTs, across ecosystems).
They want more direct and controllable profit share and ownership, and greater decision-making than the “stock holder” model of traditional investment.
Via DAOs and cryptocurrencies, blockchain investors can have those things.
As Mark Cuban noted in 2021 about DAOs, for example:
“The future of corporations could be very different as DAOs take on legacy businesses. It’s the ultimate combination of capitalism and progressivism. Entrepreneurs that enable DAOs can make $. If the community excels at governance, everyone shares in the upside. Trustless can pay”
And also:
“There are so many features and processes in any given company that can be more efficient and productive using a decentralized, trustless approach. As companies are built on this approach we will see some incredibly disruptive businesses built”
For more on DAOs, see “VENTURE CAPITAL GETTING A DAO MAKEOVER” (16 Nov 2021) and “THE CRYPTO ‘AGE OF UTILITY’ HAS JUST BEGUN” (12 Oct 2021).
Siloed Corporate Blockchains Facing Their Limits
Ruth Levi Lotan is a vice president of sales and marketing at ClearX. The blockchain initiative provides a platform for enterprises to join with partners (or forge new partnerships), and tap into their DLTs to seamlessly offer on-demand services or bundle, sell and monetize complex multi-party products.
Writing recently at Coindesk.com, Lotan argued that corporations will need to venture beyond siloed DLT systems to remain competitive.
“…consortia are still tied to private-permissioned implementations. The enterprise blockchain space simply can’t ignore evolution. Greater interoperability and the incoming wave of Web3 mean that we need to reassess the pivotal role played by blockchain consortia in the equation.”
Identity and personal data is one example where individuals want more control than the current corporate paradigms can’t provide.
One of the things Web3 promises is that users won’t have their identities, or their assets canceled or locked for expressing themselves or engaging in legal activities, simply because some corporate authority disapproves.
Another obviously huge area where newer paradigms have disrupted traditional companies is in the area of finance and banking. Cryptocurrencies and permissionless blockchains have allowed users, especially young users and workers sending remittances, to participate and accrue and preserve wealth in ways they clearly appreciate. (See “CRYPTO OPENING WEALTH TO YOUNGER GENERATION,” 2 Nov 2021.)
Solutions that offer greater digital empowerment for end-users, which is a large part of the promise of Web3, are clearly gaining momentum via crypto-powered blockchain ecosystems.
As data and digital assets become more fungible and more widely and directly owned and controlled by millions of users, technologies that facilitate DLT and blockchain interoperability, like ClearX, Quant (QNT) and Cosmos may be especially important.
For those wondering whether crypto-based permissionless blockchain technologies are just a flash in the pan, it’s helpful to try to gain more understanding of what problems these initiatives are addressing, and what innovations they’re introducing.
Corporations are undoubtedly paying attention.