13 May 2022 21:31, UTC.
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Dozens of states are now exploring blockchain technology and virtual assets. Laws and regulations are being created and passed to determine their status and taxation rules. While markets are discussing NFTs and stablcoins, government authorities are preparing to use blockchain technology for their own purposes. What are the trends in 2022 between states and blockchain can form? That’s what this article will talk about.
States and blockchain: trends
Blockchain will be the “invisible” standard
This year, blockchain technology will increasingly be used to improve the efficiency of a host of government processes, from fiat and electoral to financial with legal. The number of blockchain solutions being deployed in public authorities will take on enormous proportions and blockchain will become the “invisible” standard for them. Media interest in blockchain will decrease significantly, as it will become a familiar element of life.
Thanks to blockchain solutions, concepts of “smart states” using AI, Data Science, and blockchain for governance may emerge. Arab countries are likely to be the first to succeed, UAEThe UAE, Saudi Arabia, which creates the most favorable regimes for blockchain startups and does not impose any sanctions on them.
State blockchain solutions will split into 2 clusters.
The first cluster.
Blockchain solutions that focus on making government services more secure, more efficient. Such systems are already being implemented in Estonia and the Netherlands. Such blockchain solutions can improve the quality of public services, as well as reduce the costs of budgets for their maintenance.
Blockchain solutions to be created exclusively for the control of financial structures and businesses. Such procedures have already been implemented in the PRC, the Republic of Kazakhstan and others. Their task: to maximize control over all sectors of the economy in order to maintain the stability of the functioning of the entire state machine. We are not talking about optimizing processes in the state, nor are we talking about reducing the cost of the bureaucratic apparatus.
Development of “fake” blockchains
The conventional wisdom is that blockchain is transparent and “honest” as a technology. This is the public perception of blockchain. However, states can use blockchain to ensure the right voting results or to conceal government corruption. For this purpose, electoral, fiscal platforms will be created that outwardly resemble public blockchain, but their codes will contain “holes” that allow to hide fraud, abuses of power.
Such platforms are most likely to appear in countries that have established authoritarian or totalitarian regimes. These include the PRC, some countries in Central Asia and the Middle East.
Anonymous tokens will become even more popular
Because of the desire of many countries to put everything related to cryptocurrencies under full control, the role of anonymous tokens will increase. Among them are Monero, Dach, Firo and others, which can hide transaction amounts and recipients’ addresses. Their growing popularity will be due, among other things, to the fact that even now it is possible to de-anonymize at least 60% of addresses in the Bitcoin network, even if the owner of the asset uses the Tor network and similar programs.
There will be more DAO platforms
There will likely be a significant increase in the number of DAOs in 2022, which should solve management problems in DeFi-platforms. Already existing DeFi- solutions will make the transition from centralized structures to DAOs. There will also be an increase in the number of projects that will initially apply the Dao mechanism to manage the network. They are forced to this by the policy of states to strengthen the regulation and centralization of the entire cryptocurrency market.
So, 2022 will be a very significant year for the entire blockchain industry. How pronounced the above trends will be is difficult to say for sure. But there is no doubt that they will influence the development of blockchain. Government agencies have already assessed the prospects of this technology, and they will try to make the best use of it to increase control over the cryptocurrency sphere, as well as blockchain projects.
As for CDBs, it is unlikely to expect mass adoption in financial systems this year. Most likely, the process of their proliferation will intensify as early as 2023, when all regulations will be formalized and tests on their use in banks will be conducted. With their arrival, many cryptocurrencies may lose value or they will be consistently displaced to be replaced by CDBC.
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