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Token Economy: Web3

Web3 is here to stay and it will be beautiful — a platform built by us and for us.

Jan 26 · 9 min read

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Photo by Rafael Garcin on Unsplash

The debate will always remain on whether the internet brought us together as humans or separates us the more, but what no one can deny is how powerful and important the web has become to man, especially as a tool for creating and accessing values.

The web has changed the world to a more digital one and has helped nations evolve from the exclusive brick and mortar structures into a more dynamic and fluid system for services and operations; the influence and prints of the web can be seen in financial services, agriculture, health, education, transportation and other major aspects of the economy.

The worldwide web first started out as a platform for people to create digital extensions and spaces for others to find and access the value therein from the comfort of their homes as long as they have a stable internet connection.

As more and more people began to understand the power of the web and create value through it, the competition began to push them to find unique value and niche but also create robust ways for being market leaders in whatever business categories they were operating from.

Hence, in the bid to become market leaders, tech companies began to find ways to offer superior user experience, and to do that, they had to have enough data to understand their users better, which led to the emergence of big data and data issues that surround the web these days.

Hence, the web had evolved into a data-driven engine and skewed to favor a certain few people and tech firms in the world.

Value: At the Center of Everything

The whole world basically revolves around one thing: Value. As human beings we are attracted to opportunities, people, or places where we can maximize value, in fact, our priorities are based on value, the more we value something, the more we prioritize it.

The world in itself has become a place where we transact and exchange value right from the first day we were born; we are taught how to be ‘useful’ citizens and led unto paths that can maybe increase our usefulness (value), e.g. we are urged to attend school as kids so we can become useful citizens in the future.

Hence, as we grow up, we begin to develop a sense of our value and where we might best be able to contribute to society either on a micro or macro level, the point is, even if we can’t see the whole picture of how the global economy works, we all know we are part of one grand scheme of global value networks, and these networks are built on value and usefulness.

Therefore we create companies to add value, we build schools to add value, we built satellites to add our own value, we become engineers to add value, we become doctors to add value, and the value we add is only as valuable as the price people put on it.

However, for there to be order, the government as a central authority began to create central bodies to regulate valuable institutions in major economic sectors like finance, health, and education, and private citizens with more powers also began to monopolize industries and sectors.

Our world became skewed by centralization and segmented to favor a few, centralization has never really meant a unified, single, and equal system with everyone connected with seamless valuable chains.

But instead, a single body that has the power to define and regulate industries and sectors, and because we have important sectors here and there, we began to create different centralized agencies in different sectors, all making sure that the world became more unequal than ever.

The invention of the world wide web was supposed to be the hope for humanity and should break the barriers and barricade of inequality as was also intended by its founder, Tim Berners Lee.

But as already highlighted in the opening section of this article, the accumulation of data networks and silos led to the rise of ‘big tech’ and powerful enterprises who have also managed to become monopolies of different sectors via the internet.

E-commerce arguably belongs to Amazon, the search engine can be said to belong to Google, and while social media is dominated by Facebook Inc.

This is not about stopping big tech companies, neither am in trying to say that they cannot be replaced — although it’s hard to see someone replacing a company like Google.

The fact is web2 (the evolution of the web to a data-driven and user experience maximization platform) couldn’t give us the equality we wanted, and it has become a place built on stiff competition and monopoly due to a major asset that has become somewhat of a liability: data.

The advent of user data collection changed the face of the web and created a cycle of monopoly for whoever knows how to maximize data collected.

For others it’s hard to compete against the ‘big boys’ because of the massive networks of user data they have been able to gather while for others it’s hard to compete against the big boys because of the superior technology (a form of value) that they have been able to build due to their market leadership position in the first place, hence, creating a cycle of monopoly.

Cryptocurrency: The First Step We Took to Web3

There is a stark difference in how we see technology before and after the invention of Bitcoin.

Bitcoin completely changed a lot in technology by championing data privacy, autonomy, and digital currency, it was a whole revolution in the industry.

Bitcoin is a decentralized solution that leverages blockchain technology to ensure that every transaction is secure and stored instantaneously on each node across the entire system, which means there is the privacy of data for any owner of bitcoin, thus removing any need for a central institution like the Central bank.

When you make a transaction using a commercial bank, your records are kept, but when you make a transaction on Bitcoin, the data is distributed across several ledgers meaning no one can have access to your personal data because firstly, the transaction is peer-to-peer with no intermediary and secondly, there are no leakages of data on the net after a transaction.

Therefore, Bitcoin is the first invention that leaves the federal government or any central institution with no back door or access to monitor it, which can be translated as bypassing the government completely.

Bitcoin truly enforced what value is and what makes money valuable; Bitcoin became the first non-fiat currency without any government backing or asset without being pegged to a fiat currency like other stores of value like gold, hence, in simple terms, Bitcoin is a sovereign currency.

Bitcoin has since then grown in adoption and has opened a lot of channels to other digital currencies and platforms like Etherum which has also become a major frontier in DeFi (Decentralized Finance).

Presently, the world has really evolved and so many peer to peer networks have begun to rise to cater to the financial needs of people beyond borders or geographical barriers.

Bitcoin has ushered in a new era of digital and financial autonomy that is fast unifying the world wide web into a place that people can find equality and be their own institutions; this is the new image of the web, a third form of the world wide web.

Web3: Harmonizing Everything

Remember how we began talking about value and how the value of a thing is dependent on our collective agreement?

the barter system is arguably the oldest form of commerce in which people exchanged goods that they felt were commensurate in value, however, to make things faster, we decided to invent ‘money’ as a means of exchange of value and since then ‘money’ has evolved into different forms and also acts as a store of value, but as already explained about centralized governing bodies, the presence of centralized institutions have only widened the gap between the rich and poor, the financially served and financial underserved and the financially included and financially excluded.

Despite this, we simply cannot do without a means of exchanging value but can only determine who defines what this means should be, and how it is regulated, and for the first time, it seems we can do both.

Our ability to finally influence the chain of value comes with the ability to define the means of exchange of value and create a unique way to transact with each unique set of values.

As stated Bitcoin began the first step via Blockchain technology but Decentralized Finance (DeFi) seems to be a significant piece of the final puzzle.

DeFi is a platform that has enabled people to create unique tokens of value and leverage cryptocurrency to trade with these tokens across the value chains, thus finally creating an economy strictly built on value via tokens — a token economy.

The token economy is one that allows people to represent valuable entities with tokens and get rewards for the value we create or share with this unit of a token.

Imagine you have a bar of gold or any other item and wanted to trade with it irrespective of your geography, you can simply leverage on a decentralized platform to create a token for your gold, this token can be used instead of the bar of gold to make transactions with other members of the DeFi community from the comfort of your home.

So many peer-to-peer networks are emerging in various countries of the world and many Blockchain software programmers and coders are also increasing day by day as the tech industry tries to keep up with this new demand for a decentralized and seamless model of the world wide web.

The capability of the token economy is hardly even fully realized by so many people because asides from the fact that some tech companies are building solutions that can allow anyone to trade with tokens for any item, the emergence and increasing growth of freelancing and remote working completely solidifies the strength of this new form the internet is taking.

The ability of anyone to land gigs from anywhere in the world by simply building their capacity and ‘trading’ with it on the internet — think a token for your skills — completely solidifies the position of the token economy as the major future form of modern tech and opens it for even more advancement and innovation.

Because it harmonizes the various extensions of human, social, and economic capital by being able to represent tangibles (items like a bar of gold) and also intangibles (skills and services) on a single peer-to-peer decentralized platform.

This decentralized form of tech will completely remove the barriers and monopoly that the present form of the web has; firstly, token economics will gradually eliminate every form of intermediaries in the value chain and allow states and individuals to thrive in the global service sectors.

Secondly, the privacy of data via Blockchain and other cryptography technology, makes it harder for private entities to build monopolistic structures by objectifying the networks of user data they might have accumulated.

Thirdly, tokens ensure that people get to define collectively what they think is valuable and pay for it, which gives the power back to the people, and finally, the barriers of locations or geography will hardly be present as anyone even in disadvantaged and developing economies can create tokens that are equivalent to a valuable item or skill and trade with it to get paid for the value they have created.

The token economy is not just about cryptocurrencies but is a step forward from Bitcoin and digital currencies.

This emerging economy is one that is completely built on the power of the internet to be borderless and seamless as it harmonizes every value chain on the web but instead of clusters of sectors being “gate-kept” by certain monopolies and central bodies, it will connect everyone on a peer-to-peer basis with everyone having the ability to finally self–actualize and rise beyond the limitations of their environment.

Obviously, there are still some things that must be put in place for the token economy to finally become the entire face of the web — there has to be more adoption of decentralized platforms like Blockchain and cryptocurrency — but the signs are already pointing to the fact that more and more people are adopting cryptocurrency and the issue of data privacy is already becoming one of the most controversial and important issues of modern tech as countries and people are already clamoring for more data protective and secure platforms.

The token economy might be reminiscent of the ancient barter system as it involves people being able to trade with their valuable items, but the token economy is better, it is the future of commerce and tech, it will unite finance, agriculture, freelancing, consulting, communications and whatever important sector you can think of because unlike the ancient barter system that had geographical restrictions and difficult to scale globally, the internet is already a suitable platform for the token economy to work seamlessly and scale as can already be seen with its contribution to the growth of Crypto, DeFi and freelancing.

Therefore, Web3 is here to stay and it will be beautiful — a platform built by us and for us.

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