When I came back from some crypto events, from Zug to Dubai, walking through Lugano’s Plan B Forum, I came away with one thought, which is more of a question. Can you engage and empower a blockchain community (ensuring transparency and liquidity for the currency, such as for Bitcoin), while adhering to the strict rules and requirements of institutional enterprises, such as banks or pharmaceutical companies, that want to benefit from the efficiency of distributed ledgers? but should it be in line with industry standards and national laws? Is Bitcoin the future of blockchain? No.
Can a bank store all data in its own country and leverage the potential of a chain without upsetting the community, which may live in countries that the government considers non-compliant or difficult to trade with? , like China? Can an industry group keep information completely private and differentiate itself from competitors, using blockchain to certify world-class operations and engage new generations in crypto benefits and benefits?
After a decade of Ethereum, the ultimate incarnation of first-generation blockchains, this dilemma remains unresolved. Will companies or governments adopt Bitcoin or Ethereum, knowing that the majority of transactions are approved outside their jurisdiction? Blockchains have failed the business community and the majority of individual investors.
Why? Ledgers do not guarantee scalability, as the cost and finality of transactions lag behind off-chain networks such as VisaNet. All major chains (like Ethereum or Solana) do not accurately measure and reward the quality of node owners or coin holders. They don’t take into account the modularity that heavily regulated companies need, let alone being certified by HIPAA or FDA, to name just two. Chains are still plagued by bad actors, and we all know and accept that, alienating B2B use cases and institutional investors in the long run.
On the other side of the dilemma, if I’m a miner or a fan operating a node, all I want is a chance to prove my worth and a fair return for my membership, thereby ending the oligopoly of the big whales, who harvests the most, breaks through. of the benefits that mechanical algorithms deliver. If I own a token, all I need is liquidity and some price predictability, which can be increased if companies join the party, as their play is always long-term oriented. A high-quality blockchain that rewards reputation and gradually eliminates malicious actors will benefit both token holders and businesses.
Is there a way out? New chains are emerging, the operation of which is intended to give companies the modularity and security needed to operate in highly regulated markets, while giving the community features such as proof of reputation and higher compensation compared to standard chains, so that acting as a decent community member can grow into a real source of income, while breaking the cartel of all other extremely concentrated chain communities, including Bitcoin.
Without making this piece too technical, the dilemma of serving the community as well as business comes down to choice. My options have to be different whether I’m CEO of Pharma Inc. or Bank Inc. (fantasy names) or am a young blockchain head living in Nigeria and just want to make a living with Web3. It’s marketing 101. You’re meeting the needs of two different audiences, and you have to do it beautifully.
Companies need protection, localization and audit protocols as they look to reach new audiences that only public chains can unlock. Node operators and token holders want fair treatment and higher incentives versus mere speculation, otherwise they will always be day traders.
Technology can solve this. The story of the New Gen chains (and there are many) is one of sought-after and designed innovation, which will become the new industry standard. We need choice. We need decentralization, privacy and the ability to segment a chain. The world needs enormous amounts of efficiency improvements, and there is room for more than one dominant player.
A new chapter opens in the history of blockchain. It is made of innovation on the business side, through national compliance, speed and efficiency, and of innovation on the community side, with higher incentives, proof of reputation and a long-term plan as a token, which will make the community tangibly richer. and involved.
Ten years of blockchain passed, and we – the blockchain people – disappointed businesses and consumers, with the exception of a minority of individuals (let’s put it that way), who got rich and still lead the Top 50 chains and hijack the media debate. . We need better in the next ten years. We must serve the community and businesses equally, by making chains and crypto fair and business-friendly.
Frank Pagano