[Column] How LINE Blockchain Is Shaping Blockchain’s Digital Future
How LINE Blockchain Is Shaping Blockchain’s Digital Future
by Woosuk Kim, a CEO of LINE TECH PLUS PTE. LTD and Unblock
Crypto Collapse? Blockchain’s wild ride is still ongoing. The COVID-19 pandemic induced digital transformation across industries, which also led to the prioritizing of blockchain, long touted as a technology that can improve nearly every component of daily life. The current blockchain downturn seems quite different from the past sell-offs, like the one in 2018, thanks to critical changes that have been made over years (although some issues are still unresolved). Let’s see what has been changed and developed for the better.
The first change has been regulatory re-organizations in many countries, with several precedents regarding token securities being introduced. Even Japan has reorganized the process of listing cryptocurrency through voluntary restraint organizations, and Korea’s crypto-related businesses became feasible under the Specified Financial Transaction Information Act implemented this year. It is still difficult to respond to all the experimental services available in the current market unless stricter regulations are implemented, but it is obvious that the foundation for a healthier crypto industry has been established, compared to the complete absence of core principles a few years ago.
The second change is how both institutions and companies are entering the blockchain market. The inflow of institutional capital from Coinbase, the US market’s first crypto exchange, marked a substantial change in the history of blockchain. The number of transactions by institutional traders through Coinbase increased more than six times to about $57 billion, as of the fourth quarter of last year, accounting for 65% of the total trading share. PayPal has supported crypto payment and trading services since last December, and Visa, Master Card, Goldman Sachs, and JP Morgan have also launched relevant services and products this year. All of these results have impacted positively on the crypto community, and we are now facing a completely different level of digital future, totally different from the past few years when blockchain technology was confined to a small number of minor developers and retail investors.
Last but not least, there has been a diversification of blockchain-based assets. Whereas crypto options were initially inadequate, now there are many more ways of applying blockchain technology to the real needs and unique types of assets. In addition to the type and asset size of stable coins and the acceleration of the CBDC business, personal assets are now being divided into blockchain-based investments, such as real estate and artworks. Even native digital contents (like game items, digital artwork, sports/artist fan cards, and real estate within Metaverses) are being tokenized and distributed in real-world markets, with an exceptional identity and high scarcity value. To preserve its rarity, the monthly trading volume of non-fungible tokens (NFT) grew more than 20 times in the three months since last December. Blockchain is not only a form of a single crypto. It is now a foundational technology that contains and utilizes both tangible and intangible assets unseen or nonexistent in the real world.
But what about the current problems facing the market? The biggest issue is blockchain’s high barriers to entry, as well as its unfamiliarity to the majority of corporations and general users. Many are reluctant to apply blockchain because they don’t know anything about it and have no real-world examples. General users are no exception. Unfortunately, none of the blockchain-related products being introduced are more accessible, so even many people who trade in blockchain products remain passive about using blockchain services.
The cause of those problems are, a) difficulties in responding to (crypto) regulations, b) high development costs, and c) a lack of the practical usability. When a company issues a token, it needs to be reviewed for a variety of regulatory issues depending on the nature or token policies for illegal trading, such as money laundering. Current blockchain-related services on the market have not adequately responded to these three problems due to blockchain’s characteristics of decentralization and anonymity. When a company takes action by developing their own wallet service and establishing a promising token economy, they ultimately encounter expensive development costs. Finally, another major concern is the high level of complexity and poor user experience of blockchain services, causing low user retention rates. For general users to trade NFT and use crypto-based services, a safe wallet platform is needed by a service provider (a company) and a bit of inconvenience shall be endured by users from installing a wallet app for wire-transferring.
LINE Blockchain has been working hard to overcome these problems since 2018, and others in the industry are pushing hard to provide legitimate and easy-to-develop platforms. If general users had not made a large contribution toward the demand for an eco-friendly token economy and sound blockchain, the current crypto market would still have hung on to the past.
LINE Blockchain has built the most efficient form of Mainnet and conducts an initial token screening as a platform regulatory response for other companies’ token issuances. LINE Blockchain’s own digital asset, LINK (LN), is being gradually distributed to its ecosystem contributors without financing or ICO, and was officially listed on the Japanese crypto market the last August. Another development has been the establishment of LINE Blockchain Developers, a cost-friendly platform that simplifies the development process by providing features needed for developing and running blockchain services on the LINE Blockchain. In Japan, an exchange and wallet service integrated directly into LINE Messenger was launched to provide users experience in interacting with the blockchain with ease. This year, we are aiming for an extensive business area by integrating LINK (LN) with payments and opening NFT transaction services to solidify the digital ecosystem. And, then, we will move on to another level of expansion, focusing on decentralized networks and chain integration in the light of the regulatory environment and industry stability.
Decades ago, a technology was created that featured decentralization, digital democracy and a resistance to censorship: the internet. Since the internet was introduced, society has turned more transparent and democratic, with more self-determination and freedom. But those changes that took place over the decades were not the results of an ideology or technology. They happened because the internet was reasonably sound, informative, and easily accepted by all. Just as the internet developed at a faster pace technologically, LINE Blockchain looks forward to creating an accessible and healthy blockchain market designed for everyone.
Source: The Korea Economic Daily(Hankyung) Koala Newsletter