A Consultant’s Guide to New Technologies: Web3, Digital Currencies, NFTs
Digital currencies, blockchain projects and cryptocurrency consulting have disrupted businesses.
Moreover, web3 consulting is the most dramatic shift for IT consultants. It is equally disruptive for manufacturing, supply chain, finance, investment, or intellectual property consultants.
This article is the dummies guide for some of these new technologies.
Understanding Blockchain and Digital Currencies
A cryptocurrency is digital or virtual money. It takes the form of tokens or “coins” that remain intangible, with digital files as money.
People generally use it as an instant form of payment, across geographic and currency borders, at almost no cost, and with enhanced payment security.
Although there has been a lot of fuss around bitcoin and many cryptocurrencies - and there are 9,000 of them. It is not a replacement for money. Most are “utility” tokens. They are exchange for services provided within a business. However, people use these tokens much like shares on stock exchanges.
Blockchain is the technology that underpins cryptocurrencies. It is a virtual accounting system.
Moreover, it is like a giant spreadsheet that registers transactions and makes them visible to the public. It also records ownership and changes in ownership of the assets and the order in which transactions took place.
Nonetheless, it removes the need for a central third party (a bank, a lawyer, an auditor, the company’s finance office) to record transactions and ensure everyone has the same version.
It duplicates information and distributes it across a decentralized network of computers that checks and updates the data. Everything is reconciled across every copy on every computer on the network.
This is more like having thousands of bank tellers checking and confirming simultaneously that a payment has been made. And once a transaction has been validated, none can change it - it is immutable.
A blockchain is “trustless” - it allows people who don’t know each other to share valuable assets and data. Moreover, it is a “single point of truth” where everyone has the same view of the database and all transactions.
What does this mean for business?
Because of the technology’s security, it has been taken up by mainstream financial and technical institutions, governments, and businesses.
As a result, the use cases for blockchain are growing every day.
- eCommerce payments and loyalty programs
- Healthcare and medical records
- Tax records
- Supply chain
- The Internet of Things (IoT)
- DeFi - a decentralized system for loans and investments
- Real estate
Companies may set up private blockchains, not visible to the public, known as Distributed Ledger Technology (DLT).
For example, a collaboration between IBM and Maersk shipping company to connect data from shipping lines, suppliers, customers, customs, and ports.
- It represents 100 different organizations and 55 ports and terminals.
- It tracks over 10 million shipping events per week, covering close to two-thirds of global container volumes.
- There are no paper-based and manual systems, and secure and auditable data is real-time.
The sheer size of this project shows how powerful a blockchain can be.
Noteworthy is that every “shipping event” - for example, a container reaching a port - is recorded as a transaction. So, there is an immutable record of the movement of goods. Smart contracts automate payments all along the chain.
Non Fungible Tokens (NFTs)
A NFT is a digital token that represents ownership of something unique or one-of-a-kind.
It is like a certificate of ownership or deed of sale for your house, car, furniture, a ticket to an event, or a piece of art. Blockchain records ownership and any future changes in ownership.
An NFT might represent something that exists only digitally – an image, a sound file, or a piece of text.
If you have tokenized something, you control how to distribute and monetize it. This could apply to anything - a patent, your personal data, or company-branded images.
- Nike has filed patents to produce virtual sneakers for in-game and virtual reality (metaverse) audiences.
- An artist can have lifelong ownership of the IP rights of an art piece, even if ownership of the actual item changes. A smart contract built into the NFT may automatically pay the singer every time a song plays.
- NFTs mean the end of counterfeit goods - especially in the luxury market - with NFTs embedded in QR codes that can be scanned to validate originality.
- It can tokenize vehicles, precious items, or houses as collateral for loans or to raise cash.
- NFT can secure and protect Birth, marriage, divorce, death certificates, academic qualifications, licenses, title deeds, etc., from theft or manipulation. Even domain names can be valuable.
Nearly $41 billion was spent on digital assets in 2021 - close to the $50 billion per year for global art sales.
Web3 or Web 3.0
Web3 is set to revolutionize the internet. It has been described as “An internet owned by users and builders orchestrated with tokens."
It is a convergence of technologies:
- Artificial intelligence (machine learning and natural language processing)
- The augmented reality/virtual reality metaverse, and
- Blockchain-based decentralization and smart contracts
Some of the key features include
- Ubiquity: It is everywhere, available to everyone, simultaneously. Multiple devices can connect to the internet, not just PCs and smartphones.
- Decentralization: In Web2, computers used HTTP to find data at unique web addresses. Web3 will decode meaning, emotions, and context in data. It will store information in multiple places simultaneously.
- Trustless and permission less: Web3 applications will run on blockchains or peer-to-peer networks, not dependent on centralized power or intermediaries.
- Artificial Intelligence: It will help to offer a more personalized and customized browsing experience to the customers.
- Spatial Web and 3D graphics: There is a blurring of the physical and digital through three-dimensional virtual worlds. This has application in games and sectors like real estate, health, and e-commerce.
Web3 consulting will need consultants to understand and bring together all the elements and keep up with technological changes.
Blockchain and Web3 Consulting - The New Opportunities
There is a whole new world of work for those with the right skills.
In-demand blockchain projects include
- Payments systems
- Supply Chain management
- eCommerce practices
- Smart contracts
- Digital media IP
Even Web3 consulting is becoming a reality.
I have a client whose project brings together cryptocurrencies, crowdfunding, AI, virtual reality, streaming, and shared computer resources (CDN) to disrupt the film and TV industry. It will move the influence and earning power of major studios and advertisers to content creators and viewers.
My part has been cryptocurrency consulting - working on tokenomics, which is how their token will work across the system. This is a consulting job that did not exist until very recently.
Cryptocurrency consulting, Web3 consulting, and blockchain projects have moved from the lunatic fringe to today's center stage of consulting opportunities.
It is not only IT and digital specialists who may need to upskill. All aspects of business face disruption and consulting skills will be in high demand.
Contact Consultport to tell us about your skills if you're a freelancer.
If you’re a company with a blockchain or Web3 project, contact Consultport to find the best blockchain consultants.