The potential of blockchain technology is limitless.
How blockchain technology is being implemented in society.
Blockchain technology, known as a decentralized ledger technology, is bringing about revolutionary changes in various fields. It is said to continue evolving towards 2049, and entrepreneurs, including xWIN.Finance, are beginning to compete based on this potential.
The most significant feature of blockchain technology is the tremendous increase in reliability and transparency compared to the traditional IT world. Blockchain stores data on distributed ledgers, also known as distributed nodes, making tampering extremely difficult. This enhances reliability and transparency, preventing data tampering and fraudulent activities. In areas such as the financial industry and supply chain management, where reliability and transparency are crucial, blockchain technology has already begun to be used.
Let’s take a look at how this technology is being utilized.
【1】Are fiat currencies and cryptocurrencies, used as means of tokenization and digital assets, enemies?
Blockchain has enabled the issuance and management of digital assets (tokens), which manifest in forms such as cryptocurrencies, security tokens, and NFTs, promoting the creation of new asset classes and efficient asset trading. The emergence of Bitcoin in 2009 marked the beginning of the cryptocurrency boom. xWIN.Finance also issues the xWIN token, which is a cryptocurrency.
There is a debate about whether cryptocurrencies will disrupt or compete with fiat currencies. I believe that cryptocurrencies and fiat currencies are not in competition but rather have a mutual influence on each other. For example, discussions about stablecoins and Central Bank Digital Currencies (CBDCs) are common. Countries like China, Russia, and Japan are developing CBDCs issued by their central banks using blockchain technology to provide digital versions of fiat currencies. On the other hand, there are stablecoins issued by private entities like USDC, USDT, DAI, JPYC, and more. These two types of currencies are not in direct competition but are expected to coexist and bring about significant synergy. Of course, competition may lead to the elimination of some stablecoins based on market dynamics.
Speaking of synergy, let me give you two examples:
1. The expansion of convenience as a digital currency and innovation in financial services.
Expanding Convenience as a Digital Currency. Means of storing value and conducting exchanges and investment are not limited to fiat currencies. Even before the advent of cryptocurrencies, various options existed, including shells, gold, silver, stocks, and maybe even digital points. The widespread adoption of stablecoins issued by private entities will undoubtedly expand these options. As these options proliferate, economic activities will become more active, contributing to prosperity for nations. Moreover, with the introduction of CBDCs, stablecoins may have a more stable foundation, making them suitable for a wide range of applications.
2. Innovation in Financial Services
The combination of CBDCs and stablecoins can drive innovation in financial services. The development of smart contracts and decentralized finance (DeFi) platforms using CBDCs and stablecoins, for example, can lead to the creation of new financial services and payment solutions. Additionally, substantial innovation may occur in currency exchange, which currently generates significant profits for some currency exchange businesses. Travelers and businesspeople exchanging their currency when visiting foreign countries could see reduced fees, and global transactions using stablecoins could become more accessible. Sending salaries to employees abroad or sending remittances to family members can become cost-effective and instantaneous. Exciting possibilities, right?
In summary, I believe that cryptocurrencies and fiat currencies are not competitors but different forms of assets, each with its own purposes and uses. Some countries recognize both and aim for harmonious coexistence. We should learn from human history that innovation cannot be stopped. Countries and individuals who create and effectively utilize technology are the winners.
【2】Blockchain technology disrupts financial services.
Blockchain technology brings a disruptive revolution to the financial industry. Apart from the emergence of cryptocurrencies and the revolution in payment methods and transfers mentioned above, there are numerous other possibilities.
1．Reducing Intermediaries and Lowering Costs with Smart Contracts
Smart contracts executed on blockchain platforms encode contract conditions and execute them automatically. This enables the automation of financial transactions and contracts, reducing intermediaries and lowering costs. xWIN.Finance’s smart contracts, developed by Calvin, a former BlackRock employee, are a prime example. Traditional asset management companies would require over 100 engineers and intermediaries to operate a system like xWIN.Finance’s. By leveraging blockchain technology, they can operate with just five engineering team members.
2. Decentralized Finance (DeFi) Challenges Centralized Traditional Finance
Blockchain supports decentralized finance platforms, decentralizing traditional financial services and providing a more open and accessible financial ecosystem. It disrupts the centralized financial systems found in current traditional finance. xWIN.Finance, primarily operating in Japan and Malaysia, is a DeFi platform that offers asset management services. Additionally, DeFi encompasses lending, staking, decentralized exchanges, and more. DeFi eliminates the need to entrust one’s assets to others, taking over traditional financial roles.
3. Financial Inclusion to Solve Poverty
Blockchain and cryptocurrencies have the potential to provide financial services to those without bank accounts, promoting financial inclusion. LIC, invested by xWIN Corporation, operates in the Republic of Mali in West Africa, aiming to address various societal issues using “e-commerce x blockchain technology.” Many regions in West Africa have a high percentage of people without bank accounts, posing challenges to financial inclusion. Limited access to financial services restricts participation in savings, loans, insurance, and other financial services. Moreover, many West African countries still rely heavily on cash transactions, leading to security risks, rising transaction costs, and a lack of transparency in the financial system. Blockchain technology is expected to solve these financial problems.
These are just a few examples of the limitless possibilities of blockchain technology.
Tokenized Assets:
Various assets, including real estate, stocks, and artwork, can be tokenized on blockchain, making them tradable. This increases asset liquidity, creates new investment opportunities, and contributes to economic development.
Supply Chain Management:
Blockchain enhances tracking and traceability of products, improving efficiency throughout the supply chain. In industries like food and pharmaceuticals, product safety and quality control are critical.
Elections and Voting: Blockchain has the potential to make election and voting processes transparent and secure, preventing election fraud and enhancing result reliability.
Financial Services and Banking:
Blockchain can be used in financial services such as remittances, payments, and securities trading, reducing intermediaries and speeding up transactions.
Credit Scores and Identity Management:
Blockchain can revolutionize personal credit information and identity management, enhancing data protection and security.
Blockchain technology holds potential in various fields and serves as a foundation for creating new business models and solutions. Of course, there are challenges and considerations associated with its adoption and operation.
