Opinion by Justin Banon, Co-Founder of Boson Protocol
Web3 is the foundation of a new economic order. By tokenizing real-world assets (RWAs), we can break free from outdated systems and unlock exponential wealth.
Every technological leap in human history has unlocked new wealth and possibilities, from the rural to the industrial and digital eras. However, each system has its limits. Today’s digital economy struggles with sustainability and inclusivity. It is time to upgrade.
The Potential of Web3
Web3 offers the potential for this next leap. Tokenizing RWAs—particularly luxury goods like high-value jewelry—into digital tokens paves the way for an inclusive, computable economy. This transformation enables broader access to ultra-luxury markets and paves the way for a more inclusive, computable economy through new forms of ownership.
The Soft Power of Coordination
Institutions of social coordination are key to technological progress, although they seldom advance at the same speed as industry. When they do, however, the leaps forward can prove spectacular. Think about how written language enabled the administrative systems of the first societies, or try to imagine a global economy without universal time.
Blockchains and the broader Web3 technology stack represent the next leap forward in institutional technology: Crypto technologies facilitate trust and lower the costs of economic coordination. This innovation enables elements of the economy to ‘talk’ to each other without intermediaries and to verify who and what they are with certainty. The economy can reliably process the information in these transactions.
This economy can now compute parties’ interactions rather than process them unreliably. Recent advancements in smart contract technology will only accelerate this progress, enabling new levels of efficiency and automation.
Breaking Down Barriers
Modern economies face a significant constraint: the ‘computability’ limit. This is a barrier to the scale of complexity that global economies can attain—and a ceiling on their prosperity. Blockchain technologies have the potential to break down these barriers by providing a reliable, immutable, and verifiable system for processing transactions.
Solving the Physical Asset Oracle Problem
Anyone who has traded cryptocurrencies or NFTs has experienced the certainty of a robust blockchain-enabled economy. The next leap in economic complexity is to bring all forms of capital, including offchain RWAs, into the crypto economy with the same reliable and computable ‘hard’ properties as native onchain assets.
This challenge is known as the physical asset oracle problem. Asset tokenization protocols exist, but they still rely on IOUs, which can prove just as flaky as offchain deals. Their commitments are not yet strong enough. To accelerate this transition, we need to ‘hard tokenize’ RWAs.
Early Adopters of the Computable Economy
One area witnessing the early adoption of this technology is fashion and luxury. This segment is experiencing its first global slowdown since the Great Recession, driven by economic uncertainty, rising prices, and consumers increasingly prioritizing experiences over products.
The slowdown is particularly stark among younger generations, which shows a notable decline in customer advocacy. For ultra-luxury items, brands traditionally catered to a small market of high-net-worth collectors. Enabling the fractionalization of such luxury items opens up new markets and enables broader access to ultra-luxury markets.
Unlocking New Possibilities
By tokenizing RWAs—especially luxury goods like jewelry and art—we can unlock new possibilities for individual wealth, global sustainability, and human achievement. The opportunities of a computable economic order will stretch beyond just individual wealth. Humankind stands to benefit from a new operating system with the scope to address the existential threats that face our species.
Inflection Point: A New Era for Human Progress
We are at an inflection point in complex systems evolution. The luxury market is the starting point, but our actions today will have a massive influence on what happens next. An upgraded metasystem offers the prospect of extraordinary human achievements currently beyond our reach or imagination.
Conclusion
The tokenization of RWAs will form the backbone of the next bull run and unlock the transfer of trillions of dollars of value into crypto. We are at an inflection point of complex systems evolution, and the opportunities of a computable economic order will stretch far beyond individual wealth. The question is: what will we do with this new power?
About the Author
Justin Banon is a co-founder of Boson Protocol and has been awarded World Economic Forum Technology Pioneer status. Justin studied physics at Imperial College London and holds two Master’s degrees.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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