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Web3 Predictions at the World Economic Forum

“There will be more tokenization of assets and more and more widespread use of blockchain technology.”

A member of the World Economic Forum (WEF) published four predictions about Web3 developments in 2023.

The January 4 post comes ahead of the WEF’s big annual meeting, generally known as Davos 2023 for its location in Switzerland. This is where the WEF convenes leaders from government, business and other “civil society” institutions to address the state of the world and discuss priorities for the coming year. The group says the meeting provides a platform to engage in forward-thinking and constructive dialogues and help find solutions through public-private cooperation. Others have said that it is the place where global elites meet to determine the future direction of that “civil society.”

Members of the World Economic Forum have been busy ahead of the January 16-20 meeting publishing publications on a variety of topics, and blockchain-related technology has been the subject of multiple scrutiny (see the Virtualization and Cloud Review article, “Davos 2023: See Crypto Rebound, Call for Global Rules Against Cybercrime,” reporting on an article written by Dante Disparte, an employee at a crypto company).

A recent treatise is titled “Going Mainstream: Four Web3 Developments to Watch by 2023,” written by Samantha Weinberg, WEF Project Specialist, Crypto Impact Accelerator, and Sustainability. Web3 is described by some as the third generation of the world wide web, with Wikipedia saying that it “incorporates concepts such as decentralization, blockchain technologies, and the token-based economy.”

Despite the recent problems with cryptocurrencies, Weinberg agrees with Disparte that blockchain-related technology is only advancing, and one of the key takeaways from the article is: “There will be more asset tokenization and use every increasingly pervasive use of blockchain technology.

The token-based economy can refer to processes in which digital representations of assets are created on blockchains, authenticating the transaction and ownership history of things like securities, stocks, bonds, and real estate, or possibly even other assets like land. , wine, art. or other physical valuables.

“Tokenization can allow almost any asset in the real world to have a digital representation on a blockchain,” Weinberg said. “The increased use of tokenization has the potential to revolutionize financial markets and most industries. 2023 will see continued increases in the use of tokenization, especially as more major players like BlackRock and Goldman Sachs explore its possibilities. This It could affect financial markets, but also other sectors with viable assets to digitize like real estate and entertainment as well.”

Summaries of the other three key predictions include:

• Changing the policy landscape: “There has been a lot of discussion about regulatory and policy approaches for the Web3 industry throughout 2022. Looking into 2023, this is likely to continue with more concrete policies taking shape globally.”
• Rise of decentralized social networks: “One of the fundamental pillars of Web3 is the concept of decentralization: the idea that there will be no intermediaries managing things on the Internet as it is now with big technologies. This will probably mean an increase in the popularity of decentralized social networks. in 2023”.
• Expansion of main use cases: “The top three trends highlighted point to 2023 as a year for Web3 to further break into the mainstream. As the technology matures, there will be an increasing number of concrete use cases beyond those currently exciting early adopters.” users”.

Blockchain-related technology is obviously a major focus of the WEF, which has even created a Platform to Shape the Future of Blockchain and Digital Assets, which it says was created to ensure fairness, interoperability, transparency, and trust in the governance of technology for everyone in society to benefit from its transformative potential.

Specifically, the WEF said:

“The World Economic Forum is committed to helping ensure that blockchain securely decentralizes the transfer of information in ways that reduce corruption, increase trust, and empower users,” the group says in a mission statement.

However, the blockchain-based cryptocurrency market went through severe turmoil (called by some “crypto winter”) in late 2022, prompting a recent (January 3) “Joint Statement on the Risks of Crypto Assets for Banking Organizations” from three federal agencies. which says in part:

“The events of the past year have been marked by significant volatility and exposure of vulnerabilities in the crypto-asset sector,” said the statement from the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency. “These events highlight a number of key risks associated with crypto assets and crypto asset sector participants that banking organizations need to be aware of.”

The joint statement lists many of these risks, stating: “It is important that risks related to the crypto-asset sector that cannot be mitigated or controlled do not migrate to the banking system.”