In my recent article “Crypto, Like Railways, Among the World’s Best Millennium Innovations,” I compare the blockchain revolution to the rail boom. If we apply this analogy further, what happens next?
Stuart Hilton in What Rail Did Us: The Making of Modern Britain cites this quote: “The direct effects of railroad construction are large enough in themselves to require no exaggeration. They profoundly influenced traffic inflows, site choices and patterns Land use, housing density and development prospects for the central and interior areas of the Victorian city”.
When one studies the development of blockchain technology, one can notice a curiosity. First of all, no one saw it coming: people neglected Bitcoin (BTC) and related applications; Blockchain protocols were doomed to fail as unnecessary, while Wall Street predicted the downfall of the cryptocurrency. Laugh or not, Bitcoin has “died” over 400 times. Second, the industry has captured the minds of the public, professionals, conservatives, and creators; In the blink of an eye, the Internet has adopted its roadmap from Web2 to Web3.
Just like the railways that changed cities in the early days, blockchain continues to shape the internet. Below I highlight some of the main ways in which they affect the design and architecture of virtual networks and physical infrastructure.
The first use case for cryptocurrency is instant, unsupervised, almost free payments. The majority of cryptocurrency users are not interested in exchanging the central bank currency in their countries; They simply enjoy the smooth speed and possibility of exchanging new money.
Oftentimes, this digital cash is accepted when there are restrictions on use or high fees charged for a traditional currency. As a result, more merchants are considering this method of payment, while cryptocurrency admins are also adapting.
Related: Class statement: Mapping the next stage of the crypto journey
Miners and crypto gatekeepers
Coin infrastructure adapts to regulations and vice versa. When China imposed a ban on initial coin offerings and subsequently limited mining in the country, the industry moved to more favorable areas. Countries with cheaper electricity such as Venezuela and Ukraine have also met the demand by expanding mining operations.
As more cryptocurrencies offered a proof of stake consensus, a number of Decentralized Finance (DeFi) projects emerged. So, while bankers continued to demand that this “funny money” be discarded, the industry consolidated its position and quietly grew into a market of over $2 trillion.
Now, back to the chapter on town-planning with railroads: “The arrival of railroads to London has, according to Simon Jenkins, had more influence than anything since the Great Fire of 1666.” The same thing happened with cryptocurrencies for investing: all of a sudden, millions of people – mostly millennials – got the chance if not to become super-rich, then at least to make a quick profit from the launch of new tokens. This motivated blockchain entrepreneurs to build more DeFi solutions, from decentralized exchanges to agriculture and various liquidity pools.
Related: Building Blocks: Generation Y Can Use Tokens to Get Up the Property Ladder
NFTs and chaotic network organization
If search engines like Google allow us to organize information on the Internet, Web3 will make it more efficient. For example, a particular file – let’s say, an image – can be reused as the original source rather than being copied. This seems contradictory to what we are observing now, but the introduction of non-fungible tokens (NFT), the frenzy of sales and experiences in VR suggest what a “semantic network” might look like.