Chapter 12. The Future

"The best way to predict the future is to study the past, or prognosticate"

– Robert Kiyosaki

With all the excitement generated in 2017 from the ability to raise large sums of money more easily, quickly, and in a way never seen before, and as new ideas surface and technology marches forward, the question now on everyone's lips is: where to from here? The key to answering this question is not with random guesses but with careful observation, combined with an understanding of how we got here and why.

We conclude our journey by coming full circle and back to where we started with bitcoin, the technology that opened up this whole new world. We will then look at where tokens will take us in the future, before taking a more holistic view of the crypto phenomenon.

This chapter can be summarized as follows:

• There is only one bitcoin

• The Internet of Tokens

• Future technologies

We got to where we are today with bitcoin and many people often forget this...

There is only one Bitcoin

There may be over 20,000 forks, or people who have copied the bitcoin source code in GitHub to study, learn, and experiment from, and there may be over 30 variations of bitcoin, such as Bitcoin God, Bitcoin Top, Bitcoin Oil, Bitcoin Ore, Bitcoin Candy, and even Bitcoin Pizza (what is it with resources and food?) but there will only ever be one bitcoin (https://github.com/bitcoin/bitcoin).

Bitcoin, as we all currently know it, is the cryptocurrency with the largest market share, the highest price, and the longest chain, at this current point in time at least. Bitcoin's market share, however, dropped from around 85% in February 2017 to around 30% 12 months later, but this was always going to happen. In fact, bitcoin started out with 100% market share because it was the only cryptocurrency in existence for the first two years and the only way was down, considering all the altcoins that appeared and now the ever-growing number of tokens that are constantly being created...

The Internet of Tokens

On the surface, ICOs can be thought of as an innovative way to raise capital or create tokens in exchange for money, but it is so much deeper than this. These tokens have unique properties, such as being open, transparent, and decentralized, not to mention being programmable! These tokens need to have a purpose or a function. The economics of the token model, the potential interaction between tokens, and the regulatory impact all culminate into this token entanglement that will help to redefine the future of tokens.

ICOs

As tokens flourish, ICOs will also flourish, but just not in the same form as the craze of 2017. ICOs will be more measured as regulations set in. Expectations will be reset, such that a website, a white paper and an idea do not blindly raise $50 million USD. If this happens, the raise will be much lower and be under more scrutiny. Investors are now savvier and more knowledgeable.

As a form of raising capital, an ICO is very powerful and spurs innovation...

Technology

The crypto economic revolution is not going away. The idea that we can have a digital consensus network, without trusted third parties, is too powerful, so the concept of a giant, scalable, distributed grid of the internet is the real internet that many of us were hoping for.

There is a constant battle between the centralized and the decentralized world. Some ICO companies are looking to bank the unbanked, by providing services to an estimated 2.5 billion unbanked adults around the world (https://www.weforum.org/agenda/2016/05/2-billion-people-worldwide-are-unbanked-heres-how-to-change-this). Other ICO companies, such as OmiseGO, are looking to unbank the banks, but it is not all black and white. There are degrees of decentralization.

On the one end of the spectrum there is bitcoin, which, as previously mentioned, is decentralized to the degree where there is no leader. The trade-off here is that making decisions becomes difficult and slow, as demonstrated in the Great Bitcoin Scaling...

Privacy and anonymity

"Privacy is necessary for an open society in the electronic age. Privacy is not secrecy. A private matter is something one doesn't want the whole world to know, but a secret matter is something one doesn't want anybody to know. Privacy is the power to selectively reveal oneself to the world."

– Eric Hughes, "A Cypherpunk's Manifesto", 1993

(https://www.activism.net/cypherpunk/manifesto.html)

Ask any individual how important privacy is and you will get the same answer every time: privacy is very important but in a digital age, where we don't have control over our personal information, how do we take it back? In April 2018, this importance was further highlighted in a very public Facebook–Cambridge Analytica data scandal.

An app was created in 2014 called This Is Your Digital Life and about 270,000 people were paid to participate. The glitch was that it not only collected personal data from the people who agreed to participate but also the personal information of all...

Summary

In this chapter, we put forward arguments that bitcoin is and will continue to the be the reserve currency in the crypto universe because it is the only true decentralized currency that not the SEC nor any other regulatory body can sue, shutdown, or attack. It has this unique equilibrium between the users or consumers of the service, miners who secure the network and the core group of people who look after the code on Nakamoto's behalf.

Bitcoin is the killer app, at least for this decade. In the next decade, we will be looking out for that killer smart token, as more and more tokens will be created for everything soon, bringing us to token saturation and then a consolidation. Tokens will become smarter and with the advancement of AI and machine learning, the tokens in our lives will be all managed "automagically" under the covers.

We also outlined that ICOs are going to drastically change, as we've already started seeing, and turn into more traditional securities, but this won't stop...