What role will Web3 play in our lives in the future?

The global managing partner of Flourish Ventures, backed by Pam and Pierre Omidyar, shares his vision of a digital future that can expand economic opportunity — if innovators and societies can harness its potential.The tech world is gearing up for the next digital revolution.Buzzwords are everywhere.Tech ICONS from Mark Zuckerberg to Jack Dorsey are renaming their companies in their enthusiasm for metasexes and blockchain technology.In response to the rise of private cryptocurrencies, central banks are exploring whether to issue their own digital currencies, and policymakers are considering how to regulate private staboins (cryptocurrencies linked to fiat currencies such as the US dollar) as they function like savings deposits.To its promoters, metaspaces — networks of virtual reality worlds — are a utopian vision of the future of the Internet.Web3 is a building block, billed as a more democratic Internet than our current one (Web2.0), and built on blockchain innovations such as smart contracts and the ability to form self-governing, decentralized autonomous organizations (DAOs).Sceptics are less sure whether all this is feasible, transformative or even beneficial.The false dichotomy seems to me that the future will not be either/or.It will not be analog versus digital, centralised versus decentralised finance, central bank versus private money.Our future working and financial lives are likely to unfold in all of these combinations, in a brave new hybrid world of new opportunities for economic participation and ownership, but also new challenges of exclusion and privacy.Innovators, entrepreneurs, investors and policymakers have a responsibility to ensure that together we capture as much of the new upside potential as possible, while minimizing new risks.It is not hard to imagine how our economic life will evolve rapidly with the development of new technologies.Imagine this future: an aspiring Nigerian freelance journalist rents an apartment in Lagos, works from home, buys food from the corner shop and coffee from the cafe downstairs.She will continue to pay for many of these everyday items in domestic bills.But she also uses a private stablecoin that costs almost nothing and can be used immediately, sends money to family and friends abroad, chats daily on their favorite platforms, often meets up in a VR open-world game, and they watch live concerts together.At work, she will collaborate with like-minded writers, graphic artists and editors on global media projects through a creator-driven DAO.Some of her partners are local, others are in the Philippines, Germany, Vietnam and Brazil, and smart contract invoicing and revenue sharing across borders is easy on the community’s blockchain.Unfordable Tokens (NFTs) protect her intellectual property in the same way as allowing members of the online community from around the world to buy her self-published novels.The success of her online newsletter opened up new financial opportunities.She had no traditional collateral, but now she can borrow with her reputation in the digital community and subscribers to her readership.Living in a multiverse in which, to varying degrees, all of us will spend our future lives in this parallel economic “realm.”We will continue to eat, sleep and exercise in the physical world, and we will also spend more and more of our time working, connecting and playing in various digital realms.Each of us will live in our own multiverse.It makes economic sense.In the course of our economic history, we have moved from an agricultural economy to a manufacturing economy to a service economy.In the service economy of the past half century, more and more consumption has been digitized.This will continue to accelerate, in addition to streaming movies and multiplayer online games, but also esports, digital art, augmented reality shopping, and a growing demand for digitally native goods such as avatars and their accessories.The question of where power lies in these mixed worlds remains unresolved.Today, large chunks of the Internet are owned by several platforms.Companies like Meta, Amazon, or Apple control the content created within their walls.The advent of NFTs could change that, giving users more control over the value they create.In a world with a decentralized alternative, creators could regain control of their intellectual property, much as they have tried to stream music through platforms such as Audius.Countries could move to issue their own retail central bank digital currencies.Access to easily transferable and universally accepted currencies would profoundly change the global financial architecture and the nature of local financial intermediation, which has historically been dominated by commercial banks.You can imagine a world in which a handful of public and private digital currencies from around the globe compete for a share of consumers’ digital wallets.Some academics and regulators argue that the current enthusiasm for metacarspace and some of its manifestations, such as the rush for virtual land, feel overblown, and there is certainly reason to believe that speculators could lose money (just look at bitcoin’s volatility).The current moment reminds me of The Gates Law, the axiom that humans generally overestimate the technological progress that can be achieved in a year and underestimate the progress that is likely to occur in a decade.In the brave new mixed world that is likely to be built over the next decade, we will need a new inclusive agenda to ensure that the future of the economy is equitable and its benefits widely shared.As a first principle, everyone will need secure and easy-to-use digital wallets that allow access to all areas they want.Interoperability and low transaction costs are essential for broad participation in the global and local economies, both real and virtual.We will need to take collective action to ensure that everyone has a unique digital identity that enables them to participate, while protecting their data and privacy.It is impossible to predict exactly how, and whether we like it or not, but the world is changing.As the potential of new technologies unfolds and they transform the way we work and live, a values-based approach remains important, as we embody in the principles of fair finance.We will need them more than ever as people’s economic lives span the multiverse of analog and digital realms.Tilman Ehrbeck is the global Managing partner of Flourish Ventures and chair of the Advisory Council of the United Nations Special Advocates for Financial Inclusion.

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