Recommended Reading: Internet of Value
Title: Enabling the Internet of Value — How Blockchain Connects Global Business, Springer Verlag, 2022. Available on Amazon.
Who: Three editors from the Centre for Blockchain Technologies, University College London (UCL), namely:
- Nikhil Vadgama, Deputy Director of the Centre and an adjunct teaching fellow at the UCL School of Management. His research interests focus on emerging technologies and decentralized finance. He has experience in industry in the financial services, real estate and education technology sectors.
- Jiahua Xu, Research Project Manager and Research Associate at the Centre. She was previously a postdoctoral researcher at the Swiss Federal Institute of Technology in Lausanne (EPFL), Switzerland as well as a research associate at Harvard Business School.
- Paolo Tasca, Founder and executive director of the Centre and is a digital economist specializing in P2P financial systems. He has advised on blockchain technologies for different international organizations including the EU Parliament and the United Nations. Paolo is a serial entrepreneur in the blockchain space.
Why: This book offers perspectives on what blockchain technology has to offer beyond the exchange and remittances of cryptocurrencies. Digital ledger technology (DLT) has ushered the latest incarnation of the internet, referred to as “Web3 or “Internet of Value” (IoV). It is founded on a trustless protocol, thereby enabling efficiencies to be realized by eschewing the role of intermediaries involved in traditional transactions. Throughout the use cases, the coupling of Blockchain technology with: Artificial Intelligence (AI), Machine Learning (ML) and the Internet of Things (IoT) are exemplified.
What: The book is a collection of academic papers (14 authors / thought leaders). It is an excellent reference material that offers insights on the realms of potential applications, with examples drawn from finance, real estate, social media, e-commerce, circular economy, governance, and privacy. Each paper provides a comprehensive description of the current context and identifying the scope of where DLT may be applied. It offers the reader a sense of who is doing what, how, where, and why.
For example, the paper on real estate, described the scope of this asset class (estimated at $250 trillion), characterized by transactions that are manual and paper-based, noting that land registries have limited amount of digitization and “real estate markets are full of intermediaries and subject to high levels of fees, opacity and general slow turn-around times”. The first part of the paper is a comprehensive examination of the opportunities in construction, title creation, property search and acquisition, due diligence and financial evaluation, real estate investing and tokenization, title management, financial and payment systems, and property management. The second part examines “digital streets”, a proof-of-concept used for conveyancing in the UK. The reader is presented with a description of the risks and challenges that may be expected as DLT applications are explored. The paper is well researched with references and detailed footnotes.
While the book was published in 2022, I got the impression that some references in the selected papers are somewhat dated given the innovations taken place in past several years. Nonetheless, it is a good read. There is an excellent executive summary in the appendix/back matter.
Selected quotes:
What is the Internet of Value (IoV)? The IoV can be defined as the instant transfer of assets expressible in monetary terms over the Internet between peers without need for intermediaries.
Addressing the principal-agent problem: The IoV helps to reduce this specific problem through the use of smart contracts, as well as by giving principals new possibilities to monitor transactions.
Governance: New IoV businesses can take the form of decentralised autonomous organisations (DAOs) through an optimised governance structure that incorporates decisions made by both computers and humans.
On tokenization: A purely virtual system can address “truth” through self-containing consistency. Once the distributed ledger achieves consensus about who is entitled to control a tokenised asset, this is sufficient to effectively establish ownership in the practical sense.
On future of banking: To cater to the new trend and remain competitive, centralised digital currency issuers will likely provide new on-ramping options and exchange pairs with decentralised cryptocurrencies, leading to their true mass adoption. The proliferation of new forms of money may act as a bridge and educational tool for the mainstream public to transition from legacy systems to a new tokenised economy.
On privacy: Through zero-knowledge cryptography, transaction data can be obfuscated, and varying degrees of access to information can be implemented.
Other media: (sorted descending from most recent).
Paolo Tasca on Walker&Williams (April 2023) — interview in which Paolo talks about #bitcoin, #hedera, #hbar, the future of blockchain, what changed his perspectives on DLT, thoughts on CBDCs, SEC v Ripple, transparency, NFTs and then some.
Paolo on twitter announcing launch of DLT Science Foundation.
Jiahua Xu, London South Bank University YouTube Channel (Oct 2021) introduction on the landscape of decentralized finance — including DEX’s, lending protocols, yield aggregators, decentralized insurance
Nikhil Vadgama on Antony Welfars youtube channel (2019), speaking about research interests and thoughts about DLT and commercializing blockchain.
