• by William Mougayar
    Venture advisor, 4x entrepreneur, marketer & strategist. I live in Toronto, curate a lot, blog a bit, and help startups.

The Next 10 Years: 42 Macro Predictions in Cryptography, Blockchains and Consensus Protocols

It would be interesting if we could look into a crystal ball and predict the future of Bitcoin, blockchains, cryptocurrency, decentralized applications and cryptography-based protocols and platforms.

All of this activity is under what I like to call “Crypto-Tech”, as a parallel to Info-Tech which is everything related to information technology.

At the macro level, I think the future of Crypto-Tech will unravel in ways that may not be so different from how the Internet unravelled.

From an endgame point of view; over the past 20 years, the Internet has generated impact along these 4 dimensions:

  1. New Internet-only companies have emerged.
  2. Existing organizations (and governments) have adopted the Internet inside their operations.
  3. Some industries were threatened by the Internet, and it radically changed them or hurt them.
  4. Web-based software development became a staple for any software application development.

 

Fast forward 10 years from now, you could replace the word Internet by Crypto-Tech, and the same endgame would hold true:

New Crypto-Tech giants will emerge after being startups. Organizations and governments will adopt new solutions. Industries (and some companies) will be threatened and their business will get affected. And Crypto-Tech development will become part of the software development fabric.

These predictions may feel too high level, macro, meta or generic, but they are helpful as we work backwards, and get ready today for what is bound to inevitably happen, tomorrow.

So how will we get there?

In my opinion, it starts by applying innovations in software development. These innovations will unravel as follows, along the same 4 dimensions of how new technology typically permeates our world:

Screen Shot 2015-06-06 at 10.44.31 AM

New Companies and Behaviors

  • Online identity and reputation will be decentralized. We will own the data that belongs to us. We will self-manage our online reputations, and as we interact with various people or businesses, only the relevant slices of data will be revealed to them.
  • Cryptocurrency-only banks will emerge, offering a variety of financial services based on virtual currencies.
  • Decentralized prediction markets will enter the mainstream and offer frequent and credible predictions.
  • Distributed Autonomous Organizations will become viable, with self-governed operations and user-generated value creation that tie-back directly to services and financial rewards.
  • Spontaneous, and trusted commerce will happen between peers, without central intermediaries, and with little to no friction.
  • Content distribution and attributions will be signed on the blockchain in irrefutable ways. Ownership authenticity will be easily verifiable for digital assets and physical products alike.
  • Digital or hardware e-wallets will become mainstream, or embedded in smartphones and wearables.
  • Seamless microtransactions will be routine, as easily done as giving tips in real life.
  • Registry services for assets will exist and become more routinely done online than via visiting physical authorities.
  • Users will be able to implement business logic and agreements between them, and easily enforce them on the Internet.
  • Services where users earn cryptocurrency by performing routine services will be popular.
  • Blockchains will become large repositories of semi-private information; information that is revealed only when 2 or more parties agree to reveal it.
  • Global remittances will be routinely performed from smartphones or computers, and as easily done as sending an email.
  • Users will use blockchain-based technology without knowing about it; just like using databases.
  • There will be 10 widely and commonly used, global virtual currencies that will be considered mainstream, and their total market value will exceed $5 Trillion dollars, and represent 5% of the world’s $100 Trillion economy in 2025 (Bitcoin will still be the largest one of them).

 

Inside Existing Companies

  • Healthcare medical records will be instantly and permanently shared between patients and doctors, securely and routinely.
  • Legally binding governance related matters will be easily implemented across distributed teams.
  • Remote voting will be trusted, even at the country levels in legally binding political elections.
  • Trading exchanges (stocks, commodity, financial instruments) will adopt blockchain-based trust services for validating transactions, and streamlining their market-clearing activities.
  • Most banks will support routine bi-directional crypto-currency transactions (between fiat and cryptocurrency).
  • Most merchants will accept cryptocurrency as a payment choice.
  • Accounting, billing and financial packages will include cryptocurrency as standard choices, including crypto-equity.
  • Digital goods will be invisibly stamped for their origin authenticity, as a routine. Users will be given visibility into global productions by peering into the transparency of supply chains.

 

Threatened or Transformed

  • Any business that doesn’t combine its real-world information into a blockchain (just like the Web mirrors and extends an existing business into the online and mobile worlds).
  • Clearing houses with high latency and steep fees.
  • Any brokers that don’t offer more than what digital value offers or enables.
  • Central lenders that don’t evolve how they lend money.
  • Banks that don’t adopt crypto-technologies
  • Government services that don’t offer even more remote services, such as for registries, record keeping, licenses, and identifications.
  • Notaries that can’t operate virtually with cryptographically secured documents.
  • Anyone who is empowered to issue contracts, signatures, escrows, trusts, certifications, arbitration, trademarks, licenses, ownership proofs, wills or other private records.

 

Just Technology

  • Decentralized consensus protocols will become a common part of any technology stack implementations, both in public and private settings.
  • Commonly used technologies will include: Distributed Hash Tables and the InterPlanetary File System (IPFS).
  • Key-value store databases will be more commonly used.
  • Special browsers will enable unique blockchain peering capabilities.
  • Smart contract languages will proliferate.
  • Writing decentralized applications will become as popular as writing Web apps today (e.g. Ethereum as platform for that)
  • Open source protocols will be used and support the creation of new business services and products.
  • Running business logic that contains trust and verification components will be plug and play in the virtual sense.
  • Peer to peer decentralized base layers will be common in data storage, computing infrastructure, identity, and reputation.
  • Decentralized trust will be relegated to the network and embedded inside the applications instead of controlled by intermediaries.
  • University degrees in Cryptography and Game Theory will become popular.
  • More decentralized forms of cloud computing will emerge.

 

All of these new scenarios will be based on cryptography-enabled solutions that will make this possible.

Having learned the Internet lesson of the dot-com crash, I will end by issuing a warning that “Speed kills”. Speed in hyping what the blockchain can do will kill it, because it puts us ahead of reality, and that disconnect is guaranteed to disappoint those that expect returns faster than what is possible.

So, let’s not hype this by assuming it will all happen in the next 10 months. It will happen, but over the next 10 years. There is hard work ahead. It’s a long road, and success will be along the way, not in the initial launching moments.

  • “There will be 10 widely and commonly used, global virtual currencies that will be considered mainstream, and their total market value will exceed $5 Trillion dollars”

    Where did you get these numbers from, or just speculating?

    • It’s an educated guess, based on what’s possible. I may be off by a few billions ;)

      • ZekeV

        That’s a bold bet! I do agree with the spirit of your prediction, that there will be multiple virtual currencies that hold value, and that the total market cap will be “large”. 10 years is a ballsy timeframe for such a detailed prediction. You could have wussed out and given a Kurzweilian 30-year timeframe. But no, you’ve committed to 10 years, which is probably near enough in our future that Disqus will still be around and we can come back here to congratulate or make fun of you, depending on circumstances.
        Some of this may depend on how you define virtual currency, of course. Bitcoin and its clones and competitors are fungible, clearly “currency”. Although there is some intrinsic value in the ability to spend bitcoins to create a tx record, people tend to ignore that and think of it purely as digital wampum — a network whose killer app is just transferring money. If we’re just talking about bitcoin clones that are used primarily to exchange value, then maybe the top 10 will comprise most of the value. I hope that it is more of a long tail, but that is a hope not a prediction.
        The definitional canon gets murkier when you start dealing in exotic digital assets with deeper ties to a service. For example, you could think of Urbit ships as a digital asset worthy of at least a footnote if not a chapter in any book on our current digital asset Cambrian period. I’m sure many projects we haven’t even heard of yet will be built on similar models of enforced mathematical scarcity — networked software with pre-determined address space, cellular networks that sell their own bandwidth tokens, distributed uber dispatching software with unavoidable surge pricing. Virtual currency becomes a financing technique that, if used with a properly distributed business model, is resistant to political/regulatory and other anti-competitive forces.
        I disagree with many of my fellow bitcoin nuts who think that bitcoin can or will meet the vast need of future digital token issuers. There are just huge incentives for developers to launch clones and alternatives (of varying quality), rather than to use The Bitcoin, or sidechains (which for the record, I think entirely lack proper incentives for asset issuers). Even if we assume that bitcoin itself can ever grow large enough to hold all the information that we will one day wish to put into distributed ledgers. We shall see.

        • I like your thinking Zeke. And I agree with many of the pure digital tokens issued for the sake of a new company formation that hasn’t proved anything yet is pretty risky, and the majority of them will go up in flames.

          My prediction is mostly based on a top down thinking, and I looked at the world’s GDP in 2015 which is predicted to be about 100 Trillion, and thought what if virtual/crypto currencies held 5% of that, which is a small dent; so I went with that. And that includes physical and traditional instruments and assets that will be pegged to blockchains for transactions clearing (I’m seeing this as potentially a huge segment, as I hinted that clearing houses are at risk).

          • bruno cecchini

            Great work, my number was 2.25T on 10 years, anyway is an pandera box and as soon that somebody would open that pandera box, that would overkill the growth rate that Tandem computer archive from 1974 to 1984.

  • Good read and I agree with you on nearly all points. Can you expand on “Key-value store databases will be more commonly used?” I agree on this point as well, but am curious why you included it here.

  • Jabber0ne

    Lots of great ideas. Crypto Tech is here.

  • Sean E. Flatt

    Some great ideas in here, thanks! I’ve shared this post bit.ly/1ngCerz

  • D.M. Ryan

    Thanks for the post! I had a vague vision-level notion of where crypto is going in the next ten years, but you’ve done a great job fleshing out!

  • vortex

    This is what all investors pretty much agree with as well, short term 3-5 years, mid term 5-10 years.

  • Guest

    Brilliant article. A few questions:

    “University degrees in Cryptography and Game Theory will become popular” : why game theory?

    “5% of the world’s $100 Trillion economy in 2025 (Bitcoin will still be the largest one of them)” : what will be the BTC price?

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