There is nothing like a globally shared, traumatic event to cause us to step back and take a serious "do-or-die" kind-of-look at things. Covid has taught us many lessons in the fragility of people and the global systems we've created. Governments, businesses and regular people tried to rationalize what we were up against and prioritize our approach.
As we start to see the emergence of hope that our efforts will pay off, we are quickly moving toward some serious retrospection - you know, the "dude, I almost died, I've got to fix this now!" kind of retrospection. As a result, "we" - as a global collective of governments, businesses, and people have come to several realizations. These include the value of timely access to reliable data; establishing trust and reliability in disparate systems from manufacturing and supply chains to healthcare; and the ability to quickly support financial transactions and enable trade, including, for the unbanked.
This has resulted in several global trends and select technologies are common across most of them. These technologies are playing a pivotal role today and in the years to come:
Collapsing globally centralized manufacturing. We are seeing a move towards distributed manufacturing either back within individual countries, or closer within regional hubs that are closer to home. This will increase the demand for digitization, sensors and edge computing, wireless connectivity, data analytics, cyber security and cloud services. IoT, AI and Blockchain will play a central role in automation, intelligent monitoring and control, and real-time data sharing across multiple suppliers;
Embedding trust into supply chains. The World Economic Forum recently launched a global initiative to do just this through a combination of digital technologies with Blockchain as a center-piece for provenance and real-time tracking of good across the globe;
Establishing verifiable credentials. A return to normalcy requires the ability to travel globally. Initiatives to establish globally, or at least regionally verifiable credentials including vaccine passports that provide trusted confirmation of a person’s vaccination status, but also provide provenance of the vaccine and protect privacy. The use of Blockchain technology is central to these solutions through its use in digital identities and in providing provenance on the vaccine itself;
Transforming Healthcare. The healthcare systems and culture needs much more than digitization, it needs transformation. A big part of this transformation will be a cultural shift. Healthcare decisions, for good reason, are “evidence based,” and require a high degree of certainty and proof for decision making. While this is good for majority of decisions in healthcare, as the global pandemic showed us during the early stages between January and March of 2020, governments and public health regulators that relied on “medical-grade evidence” to make simple decisions such as ordering Protective Equipment like masks and gloves, were left struggling to cope with the threat when it became overwhelmingly clear. While global epidemiological surveillance systems like HealthMap.org, GPHIN, EIOS, and ProMED-mail that use AI/ML and NLP to track trends and predict possible outbreaks exist, early warning signs were overlooked. In fact, even a simple search on Google Trends for internet chatter and searches for terms like SARs, for instance, in China yields a sudden spike in activity as early as Dec 29th, 2019, and by January 19, 2020, where the 2nd and largest spike can be seen in the chart below, there should be sufficient data to take a serious look and initiate preventative measures. For the vast majority of the world, the action took too long, it wasn’t until mid to late March 2020, and in some cases, much later, that public health authorities and governments really started to act. Was waiting for medical science-grade evidence really a prudent approach here? Was that degree of certainty required for these kinds of decisions? Clearly not. And this is where the healthcare system needs transformation in approach. Not every problem requires a hammer.
Source: Google Trends – search for SARS in China during the early stages of the pandemic.
5. Making Finance and Trade Digitally Accessible. As central banks globally reacted to the economic impact of Covid though accelerated quantitative easing and injection of large amounts of liquidity into the economy, two very distinct phenomena have occurred.
Firstly, central banks realized they had no direct access to consumers, and in the case of the 1.7 Billion adults that remain unbanked, getting money into consumer hands quickly became a major challenge. This has resulted in the acceleration we have seen in the adoption of the use of Blockchain technologies with smart contracts to launch “cryptocurrency-inspired,” but distinctly different, Central Bank Digital Currencies (CBDCs). This will create an entirely new financial ecosystem that can support real-time payments, remove friction from existing systems and provide chain-of-custody information to Central Banks for monitoring AML/CFT and possibly for taxation. There are privacy and ethical concerns, which some central banks are keener to address than others. Ironically, but as expected, as central banks start to launch CBDCs, they have started to go after cryptocurrencies in an effort to regain control over global financial systems, threatened by a combination of cryptocurrencies and the emerging decentralized finance (DeFi) ecosystem that is unregulated.
Secondly, the massive global fiscal quantitative easing has provided greater access to cash to some industries, leading to larger cash reserves for some companies as they save money. Some have started to invest in cryptocurrencies like bitcoin and ether as a hedge against inflation. This has given rise to institutional interest in cryptocurrencies.
As a result, we can see common technology trends occurring. Overall move to digitization of documents and processes, automation, IoT, AI and cloud dominate this space. However, we can see that the one major shift has been in the actual need for and use of Blockchain technology and its ability to support real-time access to data, create an auditable chain-of-custody and provenance mechanism, enable digital identities and establish trust in trustless ecosystems has shown to be handy at this particular time. The combined benefit of digital financial transactions without fear of double-spend and the evolving DeFi ecosystems that are developing provide a distinct value proposition for the adoption of both the technology and financial capabilities it offers.
Platform businesses such as Google, Amazon, Facebook and TikTok have fared well as the incremental cost of adding new customers is near-zero dollars. They have scaled rapidly during the pandemic and their revenues have reflected this. However, according to Forbes, these aggregator platforms will see increasing threat from decentralized solutions. According to Forbes “Emerging Blockchain and crypto technologies are facilitating decentralized peer-to-peer (P2P) data networking, thereby eliminating the need for central control and diminishing the value of aggregator-distributor platforms. These decentralized networks are engendering new revenue-sharing business models amongst the P2P upstream content/data creators and downstream content/data consumers by distributing more of the profits currently being monopolized by the entrenched centralized aggregators-distributors. Creators can now have the right to own and be compensated for their data through smart contracts that automatically pay based on pre-set terms.”