We're at a pivotal moment in the history of cryptocurrency, where awareness is high and adoption is accelerating.
Most folks have heard of it by now - according to a Harris Poll conducted in February, 93% of American adults have heard of cryptocurrency, and nearly one-third have traded it.
But few have any idea just how deeply this technology will transform the world as we know it.
The next phase of crypto is mass adoption and integration into our lives. I'm not just talking about people investing in crypto, either. I'm talking about individuals and businesses using crypto and the blockchain technology associated with it to solve real-world problems and make existing processes more efficient.
If you want some idea of what's to come, think of where the internet was in the early 1990s. It went from a novelty to an integral part of our lives in less than a generation. And it was the earliest adopters who saw the biggest profits.
But when crypto is so ubiquitous that we take it for granted, what will that look like? What parts of our daily lives will crypto affect the most?
A lot of what's coming is virtually impossible to imagine, much less predict.
But there are a number of projects, either already being worked on or that have been proposed, that give us an idea of just how much how crypto will change our lives.
Today, we're going to give you a glimpse of that future and show you the biggest ways crypto could revolutionize the world as we know it. And I'm going to name five cryptos, large and small, that you need to own to make the most of these changes...
No. 1: Tokenization of High-Value Assets
The tokenization of high-value assets refers to splitting up the ownership of a large, valuable real-world asset among multiple owners by using a dedicated token to represent "shares" of the asset. It could be anything from a gold mine to a hotel to a commercial building. If the asset generates revenue, the token holder could receive a share of the profits in the form of a regular dividend.
Tokenization is already being used to open large real estate projects to a wider range of investors by companies like SolidBlock.
Alternative Wealth Daily favorite Algorand (ALGO) has a lot of potential in this arena. Its developers aim to host smart contracts that can govern the exchange of digital property or digital representations of real-world assets. And startup investment platform Republic already uses the Algorand blockchain for distributing dividends to investors.
No. 2: Financial Inclusion of the Unbanked
More than 2 billion people - about a quarter of the world's population - have no access to basic financial services. Most live in developing countries. It's very difficult for them to send and receive, or borrow money, which is a huge barrier to economic opportunity.
Cryptocurrency can fix that. People can access crypto through an app on a smartphone, which most people do own - over 83% of the world, according to Statista. Crypto can give these folks the ability to borrow money to start small businesses.
A couple of cryptos, such as Aave (AAVE) and Compound (COMP), already offer lending services that require only minimal collateralization. Crypto can also make sending remittances - payments of a migrant worker back to their home country - easier, cheaper, and faster.
Cardano (ADA) is already hard at work bringing financial inclusion to areas of the world that have otherwise been left behind through its blockchain network and ADA coin.
No. 3: Global Settlement Network
In a 2020 research paper, Cathie Wood's ARK Invest suggested that Bitcoin (BTC) could emerge as a global settlement system for banks and businesses. The reasoning was that Bitcoin, unlike fiat currencies like the U.S. dollar, is not controlled by any central bank or government. That independence has appeal in a world where nations that don't necessarily trust each other still need to do business with each other. Bitcoin wouldn't replace current systems but could emerge as an option in cases where the two parties wish to avoid fiat currencies.
No. 4: Stock Trade Settlement
Many investors do not realize that when they buy stock, the trade is not instant - it's not finalized for three days. That traps a lot of capital that could be back in the markets. But using blockchain tech can speed up when trades become final and make the whole process more efficient.
The goal is same-day settlement. Smaller crypto-oriented companies like tZERO and Paxos pioneered the technology, but major exchanges like Nasdaq and the Australian Securities Exchange (ASX) are also experimenting with it.
No. 5: A New Governance Model
One new thing blockchain tech has enabled is a new type of governance model for groups: DAOs (or decentralized autonomous organizations).
A DAO is formed with a smart contract that sets the rules, meaning there's no human "in charge." People can participate by owning a dedicated token that includes the right to vote on proposals before the DAO. It's a type of democracy - crypto style.
Some DAOs are formed for a single purpose, such as the ConstitutionDAO, which was created to bid on a copy of the U.S. Constitution. (Albeit unsuccessfully.) Some are formed to create an investment pool where members vote on proposed investments. But a DAO can be used to run just about any type of organization, even a business.
This is a very new concept; just under 5,000 DAOs have been created. But in the future, DAOs will become a common governance system.
No. 6: A New Way to Vote
Because blockchains are decentralized digital ledgers secured by a network of participants policing for discrepancies, it could be employed in a voting system. Voters would have an ID that provides anonymity but cannot be duplicated. Once the vote is recorded on the blockchain, no bad actor will be able to change it.
Startups like Horizon State are already working on this. Just imagine the appeal of letting people vote from their smartphones or PCs instead of standing in a line at a polling place. This kind of tech could give voter participation a major boost, which is a win for everyone.
No. 7: Protecting Our Personal Data
Time and again, our personal data has been hacked from big-name retailers and other large organizations (Looking at you, Equifax). A crypto-based Secure ID would fix this. Called a "self-sovereign identity," it would keep the data with the individual. People would use the Secure ID for online interactions; any data sent would be encrypted. But the key is that those online entities would not store the data themselves. So, there would be no more huge, centralized places where personal data could be stolen.
Many companies are working on this now, but we will need some sort of standardized solution for it to be practical.
No. 8: Government Currencies (CBDCs)
Government currencies are already on the way, and unlike most of the items on this list, there's a clear dark side. A central bank digital currency (CBDC) would function pretty much as fiat currencies do now, but because a central bank would control its blockchain, it opens the door to some unsettling possibilities.
For example, a central bank could track exactly where every dollar of your money comes from - and where you spend it. That's what China's digital yuan does. It would let a central bank like the Federal Reserve opt for negative interest rates, which means it would cost you to keep money in the bank. But you'd have few options since cash will likely be phased out.
CBDCs don't have to be bad news, though. House Democrats recently proposed the ECASH Act, in which the U.S. Treasury would administer a digital dollar that has the same legal status and privacy expectations as cash. Keep an eye on this.
No. 9: Supply Chain Management/Provenance of Goods
Turns out a blockchain database is exceptionally good at tracking and managing a corporate supply chain - and this has all sorts of benefits.
It means a company will more easily be able to trace where it got a bad batch of parts. It will make it possible for the customer to see where the product came from and where it was processed along the way via something as simple as a QR code on the label. (So, you can see exactly where your tuna came from or if that new outfit came from a country with human rights violations.) It will make it possible to verify the authenticity of a product, which will help combat things like counterfeit medicines and fake luxury goods.
A number of companies have been working on this, from heavyweights like Microsoft, IBM, Amazon, and Oracle to a bunch of scrappy startups.
No. 10: Decentralized Media and the Arts
Crypto and blockchain tech could have a big impact on media and the arts, particularly how it's funded. People are launching DAOs as a way to both fund and choose creative projects.
A real-world example is a DAO called Friends With Benefits (FWB). Members buy FWB tokens to participate, where the money goes into a pool to be invested, and the community votes on which projects to fund. Possibilities include magazines, music festivals, and clothing lines.
And the idea is spreading. Something called PubDAO is trying to create a collaborative community of journalists, while another called Flickto lets members both pitch and fund their media projects, with the community choosing the worthiest by vote.
No. 11: A Boost for Creatives
NFT (non-fungible token) tech can be so much more than pictures of cartoon apes. NFTs hold great promise for creating a better system for compensating artists, photographers, and musicians.
NFTs show proof of ownership with a smart contract that can be designed to generate royalties when the NFT is re-sold. Artists finally will be able to bypass middlemen who historically have taken a large cut of the sales of creative works. NFT tech could also become the way we buy tickets to concerts and other events.
NFT tech is still in its infancy, and that's been made clear by all the bad behavior we've seen play out in this space. It's pure gambling right now. But you don't have to buy an NFT to gain exposure to this technology's profit potential.
No. 12: The Metaverse
The metaverse is one of those tech buzzwords I'm sure you've heard by now. Crypto is a big part of it. And trust me, it's not going away.
Think of the metaverse as virtual reality in cyberspace. Citibank just released a report that estimates this market will explode to between $8 billion and $13 billion by 2030. Several cryptocurrencies, such as Decentraland (MANA) and Axie Infinity (AXS), are integral parts of metaverse projects. I expect cryptocurrencies to be central to the growth of the metaverse over the next decade as it becomes ever more ubiquitous.
What to Do About the Upcoming Crypto Boom
The bottom line is that mass adoption of cryptocurrencies is already underway; by the time these have all become our day-to-day reality, the biggest profits will have already been claimed by folks like you who are savvy enough to invest in crypto today.
Generally speaking, the best way to position yourself for the future of crypto is as follows:
- Own some Bitcoin (BTC), even if it's just a fractional share. Bitcoin is a long-term store of value, the way gold used to be.
- Own a variety of protocol-layer cryptos, which are attached to the infrastructure that makes crypto work. Some of our favorites are Ethereum (ETH), Algorand (ALGO), Cardano (ADA) and NEAR Protocol (NEAR).
Of course, there are nuances, and there are always going to be more opportunities to invest in crypto - we'll always keep you updated when those come up.
Right now, some of the best opportunities are in microcurrencies - small cryptos that you can get for pennies on the dollar compared to Bitcoin. There's nothing "micro" about their returns, though - they're some of the best we've ever seen, easily beating BTC and the stock market.
I'm talking potential returns of 75 to one, 211 to one... even 5,567 to one. This new class of game-changing cryptos is set to skyrocket, and we have all the details on them here...
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About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.