The Growing Importance of Blockchain Technology
The New Alternative Economic Systems (Part Two)
The Growing Interest of Companies and Institutions
This is Part Two of Raymond’s eye-opening article on alternative economic systems. If you thought that blockchains were strictly a way of keeping track of Cryptocurrencies, think again! Better yet, read this article!
To read part one first, click here. Warning: Engage your brain before reading! If you’re having a foggy brain day, bookmark it and come back later.
The Future of Social Impact Economics
In addition to revolutionizing trade, technologies that support the new value-added economy (blockchain) could also significantly change the operating structures in most sectors of economic activity; arts and culture, media and banking, to brand – employee relationships. Cryptocurrencies and the economy of the blockchains would then become the basis of a new economic system. This would also integrate the new technologies of:
- Artificial intelligence
- Machine learning
- Augmented reality
- The Internet of Things
- Autonomous learning
Canada As A Value-Based Economy?
In 2017, on the initiative of Don and Alex Tapscott of the Tapscott Group, Canada is currently on the road to becoming a value-based economy with the creation of the Blockchain Research Institute. This links the technology corridor Toronto – Kitchener – Waterloo. The consortium, which brings together a multitude of non-profit organizations, will also bring together in some big players, including
- The Province of Ontario
The Quebec Council for Cooperation and Mutuality announced the creation of a Laboratory for Collaborative Economy in Montreal. The project is supported by the Ministere of Economy, Science and Innovation Other collaborators are MC2M, IRECUS (Univ. Sherbrooke), CIRANO, Groupe GMT (Polytechnique Montréal), Fondaction, OuiShare, and Pascal Ngu Cho (blockchain consultant).
In Montréal, the consulting firm Raymond Chabot Grant Thornton has joined forces with a group of experts to launch Catallaxy.com, a blockchain center of expertise. At this rate, between Montreal and Toronto, the various initiatives towards the value-creation of block chains could ensure that Canada is positioned as an international leader.
Increasingly, new generations of entrepreneurs are also adopting the principles of a social and solidarity-based economy that is profitable and sustainable, that respects the environment and their new social values. Several service start-ups connected to the ¨blockchain¨ system, such as WAVES, NXT and Stratis, also help these companies to make the transition by offering Blockchain As A Service (BaaS) solutions. For the majority of industries, the adaptation to the new economic systems of blockchains is already one of the priorities for the next three years.
The Example Coming from The Music Industry
In a very interesting article: Blockchain Could Be Music’s Next Disruptor, published on Fortune Magazine, artist Imogen Heap and expert Don Tapscott also explain how blockchain systems can become the breakaway key of music for the next few years: ¨Artists-musicians know exactly what we want. We are not a band of tired people who like to smoke the pot in their living room and make music. We are hard-working entrepreneurs,” says Heap. In 2015, the British singer launched her song ¨Tiny Human¨ in collaboration with the startup Ujo Music. It included a ¨blockchain¨ application, to demonstrate the possibilities. It considers blockchain technology as a new platform for creators and owners of intellectual property rights to be rewarded for their value.
With block chain systems, artists (musicians, music writers, etc.), and the many other collaborators (producers, studio engineers, cover designers, videographers, etc.) of aach new creation, will register their intellectual property. With this data, the user will be able to access all the information about license rights, and acquire it for the complete work or different segments (for example, the guitar or keyboard track), for different uses (pubs, Over-dubs, soundtracks, etc.). He will then negotiate a Smart Contract with the rights holder(s), who will define the terms of services and uses, and will engage the user to pay the rightful owners directly and immediately at the time of delivery. This will eliminate significant paperwork costs on both sides.
Giving Power To Intellectual And Artistic Creators
This data, validated by ¨Miners¨ research, will allow rights holders to more easily determine with whom they may be able to do business, among collaborators and promoters. Each of the parties involved in a new creation will then be able to see in real time and follow each of the works carried out in the chain of blocks, and follow all transactions. The system of blockchains should ultimately allow artists, creators and collaborators to interact directly with users (fans, promoters, broadcasters, etc.). This would enable them to be rewarded for their fair value. The creator will then find himself at the center of the market. The system of blockchains could then apply equally well to the fields of cinema and television, books and publishing. or any other form of creation or production.
Removing Third Parties From Transactions
But the greatest advantage of this new exchange system remains that it allows for the elimination of intervention by third parties in many processes. As Jean-François Bisaillon recalls in an article by Philippe Renaud in Le Devoir:
¨The solution is a mechanism for establishing trust, transparency and authority without using a trusted third party, e.g. a financial institution, an accountant, a notary, a record company, etc. Truth, authenticity, would no longer be established centrally, but by a whole. The blockchain represents a paradigm shift in corporate governance, not a new baby that will help the cultural industries¨.
In this perspective, with the current contribution of new entrepreneurs from most sectors of activity, it is hoped that the principles of this new economy of values and social impacts will finally become the pillars of a new, more equitable economic system. One that will be sustainable for many years.
Corporate Social Responsibility
In parallel with the evolution of a social and solidarity economy (SSE) towards a sharing and demand economy, new entrepreneurs have gradually adopted new values of Corporate Social Responsibility (CSR), with blockchains and cryptocurrencies as the trading system. And from this new movement emerges a new economic system of impact that is:
- Born of solidarity-based entrepreneurship
- Focused on economic profitability
- Respects social equity, environmental protection and the role of communities in contemporary society
It is an alternative economic system that aims to have a positive effect on the whole community.
Despite the current climate of economic uncertainty and the new threats of recession, investments in the impact economy have accelerated with the new societal responsibilities adopted by companies. The growth of blockchain systems and crypto-currencies has also greatly facilitated the development of a new economy of social and environmental impact in a cost-effective and sustainable economic approach. By 2020, the World Economic Forum expects the impact economy market to reach over US $500 billion.
Impak Coin, the First Cryptocurrency to Support Impact Economics
Backing up the optimistic WEF predictions, it is apparent that investments in the impact economy yield attractive dividends.
¨In the past seven years, Morgan Stanley’s studies at the Institute of Sustainable Investing demonstrate that each year, the return on investment in the impact economy is equal to or greater than the return of traditional investment funds. 72% of impact companies generate profits” Paul Allard
Paul Allard is the President of Impak Finance, the main initiator of the Impak Coin (MPK). It is the first cryptocurrency designed precisely to support the growth of impact economics.
According to him, the difficulties of the current economic system can be explained by overfunding:
¨In 2008, with the repeal of the Glass-Steagall Act, financial investment exploded, rapidly surpassing that of the real economy. Today, financial investment represents a ratio of 1 in 4, whereas for a viable economic system, investment in the real economy should be 90 to 100% more than in the financial economy. By 2016, 1% of the population owned 50% of the planet’s assets.”
Redressing Economic Imbalance
With Impak Finance, it aims to re-establish balance by attracting the maximum amount of real investment in the new impact economy and creating financial products to serve this new ecosystem. That’s why he brought together a team of specialists to set up the Impak.eco network and launch the first Quebec cryptocurrency, the Impak Coin (MPK). With its project, it intends to set up a new financial ecosystem, both virtual and real. The aim is that it will respond to the interests of social impact companies, investment capital institutions looking for new companies to finance, and citizens, whose money has the power to change things.
To also ensure the social responsibility of companies that will join the Impak.eco network, Impak Finance has established a series of eligibility criteria as a social impact company. These criteria are based essentially on 17 metric points established under the United Nations Sustainable Economy, and are divided into four components; Seeking a social goal, demonstrating inclusive governance, and energy and ecological efficiency.
What Do You Think?
Obviously, there is much more to this subject, and the impacts have barely begun to be felt by now. Do you have any predictions for how blockchain technology might impact our future? It is a technology still very much in its infancy, yet is likely to affect all of us before long. So your thoughts on the subject will be greatly appreciated.
(You can read part one of this article by clicking here)
Note: This article is a part of the Raymond Morin’s upcoming book: “Generation C – The Confluence Marketing at the Era of Connected Consumers” that will be published next fall on Friesen Press.
Featured image: Copyright: ‘https://www.123rf.com/profile_Elnur‘ / 123RF Stock Photo
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Latest posts by Raymond Morin (see all)
- The Growing Importance of Blockchain Technology - September 7, 2017
- From a Social and Solidarity Economy to a Sharing Economy - August 24, 2017
- The Changing Landscape of Social Media Usage - April 10, 2017