Why do we Need it if There is a Centralized Solution Already?


Blockchain: Some of the legitimate criticisms is that there’s a centralized answer for every thing already, so why do we want blockchain options? Kurt Ivy explains why blockchain tech will at all times be superior.

Many clever, well-intentioned people settle for the truth that crypto and blockchain work as supposed – however there’s only one drawback:

For each blockchain answer, isn’t there a centralized answer that does it higher? This appears to be the elemental query. Tear away all the hype, beliefs, and particulars, and also you’re left with this. Do we actually want it?

I’ve to confess, this stumped me throughout a number of conversations. However that’s solely as a result of I wasn’t ready to provide the apparent reply we now have defined hundreds of instances in a thousand alternative ways. 

TL;DR: The blockchain solves the issue of digital possession.

Plain and easy. Right here’s a little bit extra: the blockchain addresses the problem of centralized management. Who has custody over info/the circulate of data? Do they deal with the accountability accurately? Do they make an enormous revenue just because they’re in charge of one thing uncomplicated that anybody else may do exactly as simply? 

With blockchain expertise, NOBODY controls info. Entry to info turns into a public utility, and entry to info defines how the web works on a elementary degree. It’s every thing. 

Let’s make this clear:

The web and the programs constructed inside it have change into what roads, powerlines, and plumbing are in actual life. 

Fee options, banking, and commerce  – these are PUBLIC UTILITIES. They’re a necessity, not a luxurious. 

So that you see… It doesn’t matter if centralized entities are extra environment friendly options in sure points. That’s as a result of these centralized entities are abusing their place and milking the programs that society requires to perform correctly. If we may belief people to do what’s greatest for the nation after they have completely zero incentive and accountability to take action, then firms like Amazon and Uber could be nice. Clearly, our belief was misplaced, and we’re buying and selling just a few comforts for wealth and autonomy. That is proving to be disastrous to the way forward for our society.

These centralized options aren’t simpler. They seem to offer one thing nice on the floor. Beneath the floor, they’re slowly sucking nations dry. 

NFTs

Let’s dig into some particulars. The NFT web page on the Ethereum web site has a extremely nice, easy infographic to clarify the advantages of NFTs:

The second level right here is one other fast abstract of my clarification. Possession of digital data  –  accounts, memberships, inventories  –  are saved on servers managed by establishments. We’ve got to belief them with this info. For instance, Amazon has large management over e-commerce just because they maintain custody of the digital objects   – inventories   – and management how they’re displayed. They take a minimize of the income on each side of a transaction to reward themselves handsomely for being the intermediary. 

Shiv Sakhuja posted a fantastic article in regards to the utility of NFTs. I wish to tackle a few of his factors by means of the lens of centralized vs decentralized custody of data. 

However First, E-Commerce

This isn’t one in all his examples, however the function of blockchain expertise in retail and e-commerce can’t be overstated. First, let’s study essentially the most primary constructing blocks of e-commerce:

Vendor uploads knowledge to websiteBuyer views knowledge

Now, who’s going to carry and handle all of that knowledge? If we enable a central establishment to handle the information, they may definitely abuse their place of energy and put a pressure on e-commerce actions.

As a substitute, we will use the blockchain to facilitate knowledge storage and financial transactions. Nobody owns the blockchain, and but it’s cost-effective and safe. An e-commerce platform constructed on the blockchain would supply any utilities {that a} centralized establishment may present, however there could be no charges and no censorship. No stealing of merchandise. 

eNFTs — A Resolution With a Identified Drawback

So that you see, all we want is somebody, or one thing, to entrust our knowledge to. The blockchain affords this answer. As a substitute of importing product knowledge to a web site, it may be uploaded as an NFT, or a SHOPX e-commerce NFT (eNFT) to be actual. With this, centralized entities will not management product knowledge, and, in consequence, is not going to management e-commerce.

The blockchain doesn’t ask for income. It doesn’t ask for charges (except for small alms to maintain the system on-line). Functions constructed on the blockchain are accessible to anybody at any time. That is the muse of a real free market. A digital house the place individuals should purchase and promote, similar to they might in actual life, and not using a third-party meddling of their enterprise and taking a minimize.

One other nice utility that eNFTs convey to e-commerce that centralized options can’t (or is not going to) is interoperability. At present, every e-commerce platform has its personal infrastructure to keep up and distribute retail knowledge. This knowledge isn’t transferable from one platform to a different. To switch stock, each bit of data have to be re-entered, little by little. 

eNFTs provide an answer to this drawback. As soon as the product knowledge is uploaded as an eNFT, it may be used on any appropriate e-commerce platform. Information entry turns into a one-time occasion. This additionally standardizes knowledge throughout all platforms.

Tickets, Music, and Video Video games

These are the low-hanging fruits of what NFT expertise has entry to. To deal with all three within the context of digital possession, it’s clear what the issue is: centralized establishments act as middlemen for all three. 

What are the core ideas right here? Tickets are one thing that venues promote to contributors. Music is one thing that artists promote to followers. Video games are one thing that creators promote to avid gamers (this one is a bit more difficult, cling tight). If we may minimize out the intermediary on all three (ticket distributors, labels, and studios), then we may focus the income and a spotlight on what actually issues. The content material.

Blockchain: One of the most valid criticisms is that there is a centralized solution for everything already, so why do we need blockchain solutions?

Blockchain and Tickets

Ticketing isn’t a very run trade, however there are nonetheless large income to be made by standing in the way in which of artists/venues and followers. There are different advantages of utilizing NFTs that centralized entities can’t present. Secondary market management is an enormous perk right here. You could assume that that is in truth a nasty factor. Why would we wish elevated management as a substitute of extra freedom? Properly, ticketing is a really particular case. 

In regards to the secondary market, neither venues nor patrons need overpriced tickets, pretend tickets, transferring tickets with out fee/fee with out getting the ticket, or overly difficult transfers. NFT tickets may be transferred safely and securely with out worrying if the opposite aspect pays or if they’re providing you with a pretend ticket. And the worth may be locked in, unable to extend.

Blockchain and Music

There are infinite issues with labels having full management over artists. Artists change into the instruments of the label fairly than a instrument the artist makes use of to distribute their music. This degrades the standard of the music as effectively. Lately there was a narrative about an artist whose label wouldn’t produce her music except she created a viral Tik Tok video. The identical artist’s abilities had been used to assist a unique artist produce higher high quality songs. 

What occurs is a money-making machine is created. This machine has one objective: to pump out money-making songs. The artists and the artwork change into secondary to the gross sales. Music NFTs like Yellowheart put management of the rights to the music within the palms of the artist. If and when music NFTs take off, artists will not have to depend on labels to safeguard and distribute their info. The data storage system – the NFT  –  isn’t owned by any particular person or establishment. So long as the artist is ready to promote themselves, they may be capable to preserve all of their earnings. 

Blockchain and Video Video games

Studios technically aren’t the middlemen between the creators and the avid gamers. Studios are the creators. However lately, studios have change into profit-seeking entities, and the creators inside the studios change into their instruments. When smartphones made apps extremely accessible and iPhone video games took off, many studios turned their consideration to pay-to-play video games with microtransactions as a result of that’s what’s the most worthwhile mannequin proper now. Small, low cost video games that may usually price a greenback can slowly rack up tens or typically tons of of {dollars}.

This, mixed with different in-game purchases like skins and objects, are pure revenue for studios. Some studios launch free video games, which depend upon in-game purchases from these prepared to spend the cash. Why not give these gamers possession of their purchases and the flexibility to resell them? This may incentivize the creation of high-quality collectibles as a substitute of low cost boosts that may’t be resold. The studio will make a revenue from royalties on resales, and the gamers will make a revenue for his or her exhausting work.

Blockchain: One of the most valid criticisms is that there is a centralized solution for everything already, so why do we need blockchain solutions?

No, The Blockchain Isn’t a Resolution Trying For a Drawback

To summarize, the blockchain is the one expertise that may securely and successfully retailer proof of digital possession. The flexibility to put declare over digital info was not possible earlier than except you owned the infrastructure that saved the data. The blockchain offers an infrastructure to retailer info that nobody owns and anybody can entry. This utility is totally needed for society and can have an unlimited, rippling impact on many alternative industries, and in consequence, our whole society. 

Concerning the creator

Kurt Ivy is a content material author for SHOPX and Gamerse, advertising and marketing advisor for Altar, head of content material at Crypto PR Labs, and CEO of Espresso Nova. Ivy is a thinker, futurist, author, and entrepreneur.

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