Small Steps to Tokenisation
A number of years ago I attended an event hosted by Launch 22 near Old Street where Nic Cary shared his opinions on how blockchain could be broadly applied to two types of economies. First, emerging markets; helping the underbanked and underserved gain access to basic services that are already established in mature markets. The second being the tokenization of Western economies, where anything with value could be freely exchanged. The latter thought I found particularly interesting.
If we can push aside the front page of Bittrex, trawling through Reddit, Telegraph channels, and ICO white papers, there have been interesting structures put forward by members of the community that point to the idea of tokenizing everything. An article written by Harry McLaverty outlines how Soundcloud could initiate a reverse-ICO to bring value and sustainability to its music service. The reverse-ICO of a company like Soundcloud could create a working relationship between content creators, content consumers and advertisers with the assumption that if the token price has linear growth they could provide a profitable, zero cost service for Soundcloud users. Further reading brought me to an article by Trent McConaghy where he explains how “Tokenizing the Enterprise” would work. The idea is that companies could tokenize shares, decentralize power and distribute value to its users. “Tokens will eat the enterprise from within because investors will make money and the community will gain”
From the inside looking out, it makes sense, for the other 99.99% this is operational Star Trek. I like to use FinTech as an example which is more established and adopted by a large range of companies but shares a similar realm. If you dig past the headlines, nearly 10 years after its first wave most financial companies are still fumbling with implementing digital strategies, accelerators and incubators with little success. Core work is still pen to paper, complex spreadsheets are the norm and data is manually inputted into 35-year-old mainframes.
If we can learn from how FinTech has been slowly rolled out into traditional markets, then we can ask the question “what pragmatic steps could be applied to get small, medium or large companies to acclimatize to the idea of working within a token based infrastructure?” The first thought brought me to something let’s call a “token based gamification of productivity”. It would support token creation for specific companies using ERC20 tokens or similar, pegged to a currency (USDT), that provides clear transparent rewards for tasks or milestones within organizations. Employees acquire tokens by completing these milestones or goals set by operational managers, the “oracle” being data supplied by external programs like CRM’s, Google Analytics, Github, etc. These tokens could then be exchanged for fiat, traded for cryptocurrency linked to an exchange or spent on internal perks.
Once employees from entry level to middle management are comfortable receiving and exchanging a company token with real value, breaking up or “eating departments from within” to give greater overall transparency and financial control isn’t too far off. This could lead to decentralizing entire companies and bringing in the new wave of “token transition consultants”. This is all very abstract but perfectly achievable. Just as FinTech slowly disturbed traditional markets, pragmatic steps need be made within proposed blockchain application to allow small pilot projects to prove the value to stakeholders which ultimately will drive the ecosystem.
