Decentralized Internet: the Future of Trust and Loyalty
Almost every relationship that works, is built on the foundation of trust. Marriages, business partnerships, religious groups, cooperative societies, it doesn’t matter what it is, as long as it involves more than one person and its continuity depends on the progress made, then its foundation is built on trust.
Trust is one of the most important concepts in man’s existence. It is used when we want to take a risk or take a step further in an existing relationship. We consciously or unconsciously weigh our level of trust in a person or something before we make a decision or take a step concerning them. Most times we don’t even know that we trust a person until someone questions us on why we have put so much at stake for that person, then we respond by saying we trust them. Hence, all I’m saying is, most things that work, do so because people involved trust them and hence do all the necessary things needed to make them work.
After building trust, we now begin to talk about loyalty. Loyalty is like an extension of trust in social, corporate, or business dynamics respectively. Loyalty is sticking with someone or something when there are alternatives and in most cases even when they fail to meet expectations or disappoints you.
It doesn’t mean that one has been bewitched or is compelled to stay loyal to a person or organization, the reality is that they have been able to build trust over time that has made us believe that even when they don’t meet up to expectation, they have a good reason and we may not be able to afford the risk of switching customers or partners.
“Risk” is the keyword in the previous paragraph. Firstly, we take a risk in trusting someone or an organization, but after we trust them and have developed a relationship with them, we are loyal to them mostly because of the risk of switching to another person or organization. Risk is what guides our decisions to trust someone or remain loyal to a person.
In this article I will make a comprehensive prediction of the future of loyalty and trust, I will be showing why the future of these two concepts will be governed by certain structures and technology and I will most importantly be showing what people are willing to risk to become a part of this future and what they will be risking if they do not.
Would you bet against the Internet?
The worldwide web is barely above 20 years old and it is often regarded as man’s finest and most important innovation. It’s not just the fact that it has opened the doors to innovations that we might have only dreamed of prior to it, but also that it has become a platform for admirable prosperity and has created billionaires all over the world. The internet is beautiful — it helps us to create, helps us in selling, helps in marketing, helps in communication, helps in transactions — it is simply the glue that holds almost everything together. To be honest, it is hard to bet against the internet.
There is hardly any sector that has not been revolutionized by the internet both on a global and local scale; agriculture, finance, power, communication, transportation, hospitality, education, etc. It seems like the whole world is moving online and more and more people are beginning to leverage the internet for more important things as the trust in the digital world keeps increasing. The internet is used these days to append signatures on important documents, keep top financial records, move large amounts of funds, and even share highly classified messages via third-party platforms with end-to-end encryption.
Therefore, the internet and the world wide web have earned the trust of people and more and more people are beginning to leverage it. The concept of trust comes into play here alongside risk. The internet has come to a point where it becomes hard to bet against it as more people have risked a lot by leveraging it, hence, it is already building a loyal generation as can be seen with the increasing adoption by the younger generation and a sign that the upcoming generations are all going to be ‘digital children’.
It has therefore been difficult for companies or organizations that have refused to quickly adopt digital solutions and channels. They have already been replaced by more innovative and progressive companies or have had to learn the lesson in a very hard way. The reason for this is that, as organizations, states, or businesses, we must always keep innovating to make sure that we have a strong presence where the market or populace is, and presently the market is online, the populace is online, everyone is simply going digital.
The world wide web has brought convenience, speed, and easy access to various processes. However, there is a single thing that makes the world wide web tick. That single thing is the only way we collaborate and ‘take risks’ on the internet. It is generally called ‘data' and it is the footprints we leave on the web. There is no digital transaction or collaboration without the exchange of data; you’re either giving your own data or receiving one. In fact, it is one of the reasons why the technology sector is often called ‘Information and Communication Technology (ICT)’.
Submitting our data or sharing them is how we access the value on the internet, but it is also the risk we take on the internet. The trust we build with a platform online is based on how trustworthy they are; can they secure my private details? What are they doing with my private details? Is my password safe and would not be easily compromised? Can my money be secure through this payment platform? Every form of trust or loyalty is based on how well platforms can secure our data. It doesn’t matter how exciting a digital platform is at first interaction, once we get to the stage where we need to share sensitive information, that is when we decide if we can trust that platform. Hence, when it comes to the internet, the one factor that influences trust is data management.
Data management has become a very important issue in the digital space. Platforms that know how to effectively utilize data have created a competitive advantage and built trust with the public. This data utilization by tech companies has been in two folds: Firstly, some companies have been able to use data to create predictive algorithms for superior user experience which has translated into a competitive advantage, while, secondly, effective utilization also manifests in the form of security, which is mostly applicable to payment and financial services platform. These platforms have been able to build reliable and secure technological infrastructures that have made a lot of people trust them for financial transactions.
The popular big tech companies like Amazon, Google, Facebook, Apple and Microsoft, all form the list of companies who have been able to build strong monopolistic advantages by leveraging on their deep silos of data to create competitive bottlenecks and expand their tentacles into other industries; Amazon leveraged on data from their e-commerce endeavors to create the most successful cloud computing service presently — the AWS (Amazon Web Services). The success of the AWS is borne out of the existing B2B relationship Amazon already has with business all over the world via their e-commerce channels, hence, it was easier to transit easily to the cloud services sector.
Google is another example of a big tech company that is leveraging on existing data networks to spread its tentacles; asides also competing with Amazon and Microsoft in the cloud computing space, the company that started with a search engine platform, has been able to expand its reach into mobile via the Android OS and the Google Play Store. The fusion of android and the google play store has enabled Google to create a synchronized data advantage leveraging on hardware and software channels. The Google account you created is synchronized to create a seamless user experience on YouTube, Gmail, Chrome, Google Drive, and other Google tools. Google has been able to create a superior user experience that enables you to do almost anything with your Google account as the platform leverages your data to improve your experience across all channels. For example, the video suggestions you get on YouTube can be influenced by your consistent search history on Google chrome.
The same can be said about Facebook Inc. and the company’s unique position as the owner of two of the most successful social media apps in Facebook and Instagram. The company has been able to build a commendable user experience across both channels by leveraging the interaction of user data across both platforms. Facebook also owns WhatsApp and there is indeed a feature that allows you to share your status automatically as a story on Facebook. This ability to utilize user data effectively has made these tech giants become really successful and also allowed them to create beautiful products for all of us.
However, the need to remain competitive and maintain a market share monopoly has led to the objectification of personal data by most of these big tech companies. The outcry from the public against these “tech giants” has been around the fact that people’s data are no longer safe and these companies are becoming too greedy for power and are willing to do anything to maintain their existing power.
There have been reports of Facebook eavesdropping on users via Instagram to influence their taste and that some of these companies are leveraging on these user data to build addictive products. Amazon has been accused by some of the businesses leveraging their cloud service — AWS — that the company is leveraging some of the data from their competitors who happen to use AWS, to copy their business models or stay ahead of that, there have been calls for the sake of the continuous progress of Amazon, it would be better if the e-commerce giants separated itself from AWS and made the cloud service platform a single entity on its own as AWS remains one of Amazon’s most lucrative channels as rumors of such misconducts can potentially affect the revenue of the cloud service.
The Facebook and Cambridge Analytica Scandal is arguably one of the most significant events that confirmed the fear of the public and the scandal has since been behind the increased scrutiny against these companies concerning how they treat the data of the public. It led governments around the world and other bodies to begin implementing and strategizing on stricter data management laws, a USA congressional hearings in 2020 was held for five of the big tech companies — Amazon, Apple, Google, Twitter, and Facebook — in which they were questioned about data privacy and if they were intentionally building addictive platforms, the European data law is being talked about to reduce the access these companies have to the data of Europeans, and so many other forms of legislation and policies have been springing up here and there as states are feeling more responsible to protect their citizens from the increasing fear around data privacy.
On the other hand, with regards to security, there seems to be an increase in the number of online fraud cases, especially in developing economies. Although, tech platforms make sure they keep building more and more security layers, the presence of a centralized structure and intermediary in these transactions and processes, still makes people vulnerable to scammers and fraudsters. Social engineering remains a major tool used by online fraudsters and cybercriminals as they know they can still breach security systems as long as they remain centralized or have human factors within the structure.
However, as we discussed earlier, the reason to remain loyal to a person or platform depends on the risk involved. People know how powerful and beautiful the internet is and the risk of leaving the internet is just too much. However, there are people who are saying that they may have to delete some of their apps if the insecurity and lack of privacy around their personal data continues. Hence, the reality is that if people have another alternative that could minimize the risk at both ends — they don’t want to leave the internet, but they also don’t trust most of the popular platforms — they would adopt it. This switch is already happening and I will show why it is at the center of the future of trust and loyalty. This alternative is not a new internet, but a new form of the internet. This new hope is a decentralized internet, and it is already gaining a lot of loyalists.
Decentralized Internet: The future from the past
The concept of a decentralized internet is not necessarily a new thing. In fact, according to the man who invented the World wide web in 1989, Tim Berners Lee, the world wide web was supposed to be a platform that promoted equality and allowed anyone to access it easily and create value that can be shared seamlessly. Since then, the “father of the world wide web” has been involved in a lot of activities and endeavors to ensure that the world wide web lived up to become what it was created for.
It’s breathtaking when you consider the nature of decentralized solutions that keep popping up around the internet, especially since the invention of Bitcoin in 2009. The digital world has seen the invention of cryptocurrencies, Decentralized Finance (DeFi), and even more recently NFTs (Non-fungible tokens).
The invention of Bitcoin in 2009 began a revolution that would change the face of the internet forever. Bitcoin changed how we saw the internet and showed us how even more powerful the world wide web can be. Bitcoin via Blockchain technology created a financial system that completely bypassed the government, central banks, and any other central financial institution. The complete decentralized nature of Blockchain technology secured every transaction on the chain while maintaining the privacy of people in the same vein. When you consider all I have said about the two major fears people were beginning to have about the internet, then there was no way Bitcoin was going anywhere soon, irrespective of the resistance.
That is exactly what happened; more than 10years since it was invented, a single Bitcoin has been valued once at $60,000, there are more cryptocurrencies springing up each day and the use case of Bitcoin keeps increasing.
Bitcoin not only affected the financial sector but also affected the social dynamics of our world; Bitcoin changed how we see money and power. Since the world moved away from the Barter system, we have never really had equal and fair control over the value of fiat currencies or other modes of transactions. Amongst others, we have used gold, coins, and now paper fiat, however, there has never really been an equal ‘money system’ due to the presence of central bodies and the government. As much as the regulation is never really a bad thing, the problem is money is a very delicate factor in the control of power and the presence of these central bodies have enabled the control of money and its values to be skewed towards a certain set of people; the rich are getting richer, the poor can barely get a loan or microfinance, while some financial institutions keep getting prosperous as long as they remain in collaboration with the government and politicians.
Something needed to change, there had to be away that we had a financial and monetary system that gave everyone a chance such that everyone could have a say as to how the value of money would be distributed, but there was hardly any way to effect a change as the structures built on centralization are so rooted and rigid. Bitcoin was what created that hope that we could have a currency that was autonomous and independent of the favoritism and influence of centralized bodies, the digital currency completely bypassed the central governments and made everyone their own autonomous financial institutions. There have been so many resistances from central bodies like the government, but as I said, people always weigh the risk involved in trusting something and the risk involved in staying loyal to that thing, hence, despite some governments placing a ban on it, more and more people trust in Bitcoin and blockchain technology and they remain loyal to them.
Just like what Tim Berners Lee would have wanted, the decentralized internet led by Bitcoin and Blockchain technology is creating an equal and open internet in which its dynamics are meritocratic in nature and is with the absence of intermediaries that have mostly monopolized the values chains on the internet.
Data management seems so seamless and nearly perfect because of Blockchain technology that some are calling for Blockchain technology to be used more in identity management and even democratic processes like voting during elections. There is so much trust in these decentralized solutions that a lot of people prefer to keep all their financial assets with them with the assurance that it is safe, it is therefore difficult to see how many more people won’t start leveraging decentralized internet solutions when such level of trust can be found in them.
Take a look at the extensions of value that are emanating from Blockchain and Cryptocurrencies due to the foundation of trust they have built; decentralized finance (Defi) is creating a token economy in which anyone can act as their financial institution. This level of autonomy and independence is incomparable and cannot be traded for anything in the world.
DeFi removes intermediaries from transactions that one would never imagine can go through without one, like obtaining a loan. The goal of DeFi is to one day remove all forms of intermediaries or central bodies from all financial transactions in order to create a financial system that is owned and governed by every individual in the system.
DeFi achieves this by operating as a token economy and leverage several technological channels like the peer-to-peer network (P2P). The token economy allows people to create value from anywhere in the world and transact with it despite their locations. People can complete financial transactions between themselves without the help of any intermediary due to the peer-to-peer network (P2P) available on decentralized technological solutions. Hence, the need for a central body like a bank is being removed as people can now act as their own financial institutions due to DeFi. It is a system really reminiscent of the ancient barter system when there was no fiat currency or accepted medium of exchange and people had to exchange valuable items that they felt were equivalent in value.
The only difference this time is that with the peer-to-peer network on the internet, there is the complete removal of the barrier of geographical location, while the token system also allows one to also represent the various type of items with tokens, meaning that the removal of the geographical barrier is not just restricted to sharing value but the nature of the value that can be shared because with DeFi one can create tokens for physical commodities and transact with these tokens as these tokens have their various equivalent value on the decentralized platforms. The whole idea is that one can represent any form of value with tokens and transact with them (there are specific processes and protocols that guide this thou).
The token economy is still very young but the promises are there to see with more and more people adopting decentralized finance and predicting that it will eventually replace wall street. After the stock trading platform — Robinhood — scandal, the clamor for Defi increased as more and more people believe that for equality to ever be achieved, it would have something to do with decentralized solutions like Decentralized Finance (Defi). The Robinhood backlash further proved the narrative that the existing financial system is only working and deemed acceptable because it keeps favoring a certain group of people. Hence, it is, therefore, time for a change in the financial system, it is time for a decentralized financial system.
Also, the recent emergence of NFT (Non-Fungible Tokens) is solidifying the position of the decentralized web as the platform for equality and fairness. NFTs have become the latest buzz in the Blockchain and crypto world.
Copyright and patent issues of digital artworks are being solved with NFTs and artists are able to own the exclusive right to their work because of NFT. A lot of artists have made huge sums of money because they have been able to sell the exclusive rights of their artworks for lucrative prices.
NFT allows artists to create signature tokens that only have exclusive rights to sell or transfer ownership to another interested buyer. One can only imagine the future use case of NFT and the number of problems a technology as unique and important as it can solve. NFTs are one of the clear indications of what Bitcoin was really about, it is another sign that decentralization is all about equity and autonomy. It is only right to predict that more and more identity management technologies will emerge in different sectors and spaces. Similar decentralized enabled technologies like NFTs would create a safe world where everyone can create value, represent these values with unique tokens and patent them in order to truly maximize the value therein.
The dynamism of the decentralized internet is so admirable. The financial and payment solutions, copyright solutions, and even security solutions all point to the fact that an economy is being built around the new look internet. The major question would have been: “are people willing to take the risk of trusting these solutions?”. The answer to that is in the daily increasing number of cryptocurrency wallets being created and the increasing number of corporate bodies beginning to accept payments and transactions in Bitcoin. It is hard to bet against the incoming web3 because of how well stacked it is and also because of how it is positioned to solve the most important problems of the ‘internet generation.
Like I said before, you can determine how successful a thing might be by checking the risk it would take to trust it and the risk it would take to not remain loyal to it and presently with more people cautious of their data privacy and demanding a fairer and autonomous internet, there is little reason why they won’t risk trusting solutions that guarantee the privacy, security, and autonomy. As for those who have already joined the ship of decentralized internet solutions, the risk in not being loyal is too much as there seems to be a lot to lose by backing out now because it is obvious that very soon all facets of the economy would revolve around these unique and exciting solutions.
However, we all have our choices to make, and it is left to us to decide the risks we are willing to take if we want or do not want to be a part of a thing. This article doesn’t impose that we should all begin buying cryptocurrencies or start leveraging Blockchain technology, but it simply shows that with the signs available, the future of trust and loyalty, is a decentralized internet.