Technology can be argued to be as old as man itself; various inventions like electricity, steam engines, railways, etc., have all changed the existence of man and how we view the world. However, most of these innovations have now become more of infrastructures with most governments now regulating and owning these spaces. The more recent definition of technology is one that is mostly borne from the invention of the world wide web in 1989. The internet remains one of the most important innovations of mankind and a springboard for most of the massive strides made by man in recent times. The internet opened new ways of interacting, communicating, transporting, educating, as well as other new exciting, and financially lucrative industries. Modern technology has therefore been viewed from the lens of the internet and its derivatives; today when we say products, we are mostly talking about mobile apps or software, almost every business out there has a website and many entrepreneurs are leveraging on so many forms of technology for business with most being enabled by one software or algorithm or the other. Modern technology is digital apps, software, websites, algorithms, cloud computing, artificial intelligence, machine learning, virtual reality, fin-tech, blockchain, etc. The power of the tech industry over the years cannot be over-emphasized as can be seen in the domination of the Forbes list.
More than ever before, technology is in almost everything we do. Technology has managed to seep into almost every aspect of man’s life and will only keep penetrating more and more as we keep witnessing more and more exciting tech solutions every day. However, tech is never static and is subject to evolution, in fact, the most successful tech companies are those who have been able to position themselves well to understand the varying needs of man and fit into it. Tech is a passive asset, meaning that, its sophistication will always be dependent on human capital or human needs, as it will always be designed to satisfy a man and never the other way around. Therefore, in this article, I will highlight the evolution of modern tech and what the future would most likely look like for the tech industry with respect to the dynamic needs of man:
It would be really strange to talk about the evolution of modern tech and not talk about the dot-com bubble, especially the historic lessons it taught the business world. The dot-com bubble was a stock-market bubble that resulted from the exaggerated speculations about the use and adoption of the internet in the late 1990s; between 1995 and its peak in March 2020, the NASDAQ Composite stock market index rose 400%, only to fall 78% from its peak by October 2002, with many companies closing up as a result and many investors losing lots of money.
Dot-com companies are internet companies or online companies with .com as the end of their names and were so popular especially after the invention of the mosaic which enabled a lot of people to use the internet more. The dot-com bubble was caused by the exaggeration of to extend the internet would be adopted and lucrative and it (dot-com bubble) triggered so many venture capitalist investment in the late 90s as many people began to raise crazy amounts of investor money, spend lavishly on advertisements and run their .com companies on massive losses, with the assurance that in the nearest future the guaranteed returns would counterbalance the initial losses.
It never really worked out like that and many companies closed, with some even closing up months after IPOs — which is not a surprise as many companies were rushing to IPO. Although, a few companies like Amazon.com and Google were able to recover from the losses and strengthen their position as leaders in their respective business categories, the dot-com bubble and eventual crash of the dot-com era, remains one of the most significant events in the history of modern tech and its evolution and advancement.
Most importantly, however, is the lesson that the dot-com crash taught us and how it remains a major lens for measuring tech and its progress. Firstly, it must be understood that the internet was still relatively new when the dot-com bubble happened, hence, the necessary infrastructure and structure needed for subsidiary inventions or plugins to succeed, was not really available, therefore, the dot-com era was one that was built around a lot of excitement but very little necessary infrastructure, but the excitement triggered a lot of investment that has made the by-products of the dot-com era crash, a major platform for the more recent successes that the internet has recorded; as investors pumped money and companies and startups used the money for activating and exploring new markets via ads, marketing, sales and putting in place new market and technical infrastructures, tech and internet innovations after the famous dot-com crash, benefited from those “by-products’ but a more stable market after the whole excitement had died down.
In his book, How innovation works, Matt Ridley explains how innovation tends to start with moments like this, with examples of the railway, locomotive, and the likes, all examples of how investors first pump money into a new but unstable industry with a lot of losses incurred, before the industry stable and benefit from the infrastructures and market activations that resulted from its previously disgraceful losses, in fact, Fred Wilson, a Venture Capitalist who funded many dot-com companies and lost a massive 90% of his net worth when the bubble burst, said in 2015, in one of his books that:
“… you need some sort of [this] mania (irrational exuberance) to cause investors to open up their pocketbooks and finance the building of the railroads or the automobile or aerospace industry or whatever. And in this case, much of the capital invested was lost, but also much of it was invested in a very high throughput backbone for the internet, and lots of software that works, and databases and server structure. All that stuff has allowed what we have today, which has changed all our lives… that’s what all this speculative mania built”
Sad, but beautiful, but more importantly is why it is necessary that we started with this understanding of innovation and the dot-com bubble, so we can fully appreciate the concept of this article. The message in this article won’t be built solely on the lessons from the dot-com bubble neither will it be a strict sequential timeline analysis of modern tech, however, its pertinent to understand a major impactful event like the dot-com bubble and the event will be referenced from time to time in this article, especially with respect to new tech industries.
They say commerce is the engine of innovation, that in order to ease or fasten the process by which value is exchanged for certain amounts, innovations are mostly borne. Therefore, financial transactions have always been a major aspect of man’s life and both private and governmental institutions have continually sought out ways to enhance or fasten its process; the government especially have partnered with commercial banks in recent years while so many governmental institutions like the Central Bank have been responsible for regulating and even innovating money as can be seen in the evolution of money from the barter system, gold standard, coins, paper fiat currency amongst many others.
However, as the internet began to open more capitalistic opportunities and trigger more exciting markets and innovations, the world has seen the rise of digital financial institutions responsible for enhancing payments, investments, loans, savings and so many other financial transactions. These solutions are different from traditional banking systems and tend to be more convenient, faster, and highly digital in their operations with the industry being referred to as Fin-Tech (Financial Technology).
Financial technology is presently one of the world’s most lucrative industry with a lot of unicorns rising from industry all over the world, the industry, although only began to gain major traction around the year 2014, has been at the forefront of the global drive to achieve financial inclusion due to its ability to bypass conventional brick and mortar structures that restrict banks (banks have also begun to leverage fintech solutions like mobile apps and USSD channels for transactions).
Fin-tech companies like Stripe, have become the center of almost everything because of the necessity of payment involved in every business. The beauty of fin-tech is that no matter the solution, people must always pay at one certain point in the chain of value, hence Fin-tech solutions always find a way to be involved in every industry outside its own. This ability has been enhanced in recent years because of the massive adoption of internet-enabled solutions and platforms by people as more and more people are becoming tech-literate and prefer to shop online, send money from the comfort of their house, pay for services from home and other forms of convenience, therefore, Fin-tech solutions seem to be in a perfect position because it firstly fits into the social behavior of man and also positions itself as a unique solution that is almost indispensable.
Some people have argued that Fin-tech is the apex of all innovations and the complete sign of a monopolistic product because they believe that the moment you have a wonderful solution and still manage to ensure that you include an in-house payment plugging as an extra source of revenue, then you are truly self-sustaining as not only do people get other values on your platform, they also get to make transactions on your platform.
E-commerce is another industry at the heart of financial transactions and although I think it is simply a channel for fin-tech — because even most Fin-tech platforms offer e-commerce services like merchant store and drop shipping — the likes of Amazon and eBay makes a case for why it is regarded as a separate industry. E-commerce has also risen in value over the year, with Amazon especially benefitting from the increasing preference of people buying things online with the e-commerce giants now ranked amongst the most successful companies in the world. The reality is financial transactions were always at the center of business but their importance in the digital world and the modern tech was simply dependent on people’s adoption of the internet and its solution and as many people have adopted the internet and software solutions its (financial transaction/ e-commerce) place as a major factor in modern tech is no longer in doubt.
Developing regions and economies are not also left out of this recent growth of the Fin-tech space with many startups in Africa providing numerous payment, investment, or e-commerce solutions in the continent. Nigerian payment startup, Paystack was just acquired by the Fin-Tech giant Stripe in one of the largest exits in the country while payment platforms like Bitsika in Ghana, Flutterwave in Nigeria, Chippercash in Ghana, Eversend, amongst others are making big waves. Fin-tech is becoming the major industry for venture capital investment in the continent as the continent is still ripe for financial inclusion as well as the industry is one that is highly lucrative.
Social media platform like Instagram and Wechat in China are becoming more and more used for online shopping as both platforms keep providing features to enhance and ease processes involving buying and selling while Whatsapp is now exclusively on track to include a payment feature on its platform, a strategy that has been mutedly been in place as a major revenue model for the company. It won’t be a shock if many other companies in sectors outside Fin-tech or e-commerce begin to seek ways to include payment or e-commerce features in their platforms so as to remain relevant because more and more people are simply looking for platforms where they can do most or all of their necessary activities in one place and paying for stuff or services remain a major need for everyone.
Fin-tech or e-commerce is here to stay as more and more people adopt internet-enabled solutions and more companies seek ways to include channels for both services. Therefore, the future of modern tech even as it continues its dynamic evolution will definitely involve these two channels at its forefront.
Remember how I highlighted the remarkable way that the internet has penetrated into our lives and how there is hardly any aspect of human endeavor that modern tech hasn’t provided solutions to enable convenience, increase speed or efficiency, well such progress came with a price and that price is data privacy management.
Data privacy remains one of the most critical issues of modern tech and is being discussed as the most important issue in the coming years as more and more people use the internet. Data is like the fingerprints we leave behind as we use the internet and other related software; as we use our personal details to access various services and solutions, we also run the risk of such data being exploited either by unethical service providers or by cyber frauds who seek to use these data for hacking, theft or social engineering.
Big tech companies like Facebook, Google, Amazon, have all been accused of leveraging on their robust user data networks for ensuring industry monopoly while Facebook was once involved in a data privacy scandal that its reputation has barely recovered from, Instagram has been accused of spying on its users while some startups are reluctant to use Amazon’s cloud computing service, Amazon Web Services (AWS), because of accusations that the company uses data from AWS to improve its competitive edge over other e-commerce platforms leveraging its cloud computing platform.
In developing economies like Africa, the problem has been more about cybercrime and internet fraud as some people are reluctant to even drop their credit card details on e-commerce platforms as they fear that their details will be leveraged by online thieves.
Therefore, securing the data of internet users has become a very vital aspect of modern tech with a lot of countries like Singapore even considering stricter data laws against big tech companies while the European Union is contemplating many data regulation laws like the recently rumored EU data governance act.
No one knows how this whole clamor and advocacy for better data protection laws, will affect big tech companies or affect modern tech, but some things are sure; firstly, people won’t stop using the internet as it has become too much at the center of man’s activities, secondly, more and more people will clamor for better data protection policies and features and most importantly, platforms that actively seek ways to protect people’s data will become respected, valuable and highly adopted.
Since it was made open source in 2009, Bitcoin has changed the way we see technology, and asides from ushering in so many other cryptocurrencies, it has impacted technology in some significant ways; first of all, Bitcoin and cryptocurrency was the first indicator of how powerful technology can be and the power it can give the average individual, secondly, it also truly showed that money is just whatever we want it to be and is dependent on the value that You and I put on it and thirdly, it greatly signified that people really value data privacy and want platforms where they can retain autonomy.
Cryptocurrencies are digital currencies that operate on a decentralized basis and leverage Blockchain technology that ensures that each user’s data is secured. Bitcoin and Crypto adoption has grown massively in spite of various obstacles especially opposition from the government and mainstream investors, the opposition or resistance from the government majorly stems from the decentralized nature of cryptocurrencies with the digital currencies running on decentralized structures and Blockchain technology thus bypassing any centralized financial institution including the Central banks owned by the government but despite the varying resistance from the government including various forms of bans in various countries, Bitcoin has grown massively in barely 10 years, with Forbes reporting in 2019 that Bitcoin was now averaging 350,000 transactions per day at around 15,000 transactions every hour which is approximately 4 transactions per second. Such massive numbers by a digital currency not yet generally recognized by the government as a legal tender is quite massive.
Such feat by these digital currencies is one that also means they are also well suited to the increasingly digitized world, with the ability to make cross border payments, speculations, or transactions from the convenience of your phone amongst other intrinsic and sovereign benefits, seemingly appealing to a lot of people, especially the millennials. This is an extension into the benefit of Fin-tech and e-commerce already highlighted in this article, however, the most significant feature of Bitcoin is how it combines the already obvious benefits of Digital Financial transactions and its pro-data privacy capabilities; the existence of Bitcoin as a digital currency means that it fits seamlessly into the increasing preferred lifestyle of people carrying out financial activities online but its ability to secure people’s data and privacy makes it even more appealing, and that explains its massive adoption all over the world despite pushbacks.
Being barely ten years means that one of the argument against Bitcoin is that the digital currency might just be one of those innovations that would come and just fade away, however, the response against such criticism can first beget from the lesson we learned from the dotcom bubble in this article; unlike other innovations that come quickly and receive a reality check like the dotcom era, Bitcoin has had to experience a very tough rise towards global appeal as the currency as seen its value drop massively at times and most importantly it took its time to win over skeptics which meant that unlike the dotcom era, the currency had to steadily open up new markets and evolve to meet market demands as can be seen in its increasing adoption in Africa. Hence, the possibility of Bitcoin being one of those innovations that suddenly come and go is very slim as the innovation has taken the proper steady route of rising to the top with many mainstream investors initially reluctant to invest in it — another opposite correlation to the dotcom bubble.
Also, the initial fear that Bitcoin would never be really be applied to everyday financial transactions and would remain a portfolio for market speculation has also begun to disappear; presently a number of major companies all over the world are beginning to adopt payment in bitcoin with notable digital financial platforms like PayPal, joining the bandwagon. Africa, a place where digital financial transactions are just beginning to really become a force, has surprisingly become a major hub for Bitcoin, which is a massive testament to the powerful growth the digital currency is experiencing, in fact, it is being argued that Africa might be the best place for the everyday application of crypto, a claim that has been recently backed by the reports that Nigeria is now the second-largest home for Bitcoin after the USA.
Although, it may not be the best confirmation that the Bitcoin community needs that they are on the right track, but the reports that many Central banks are planning to launch a digital currency that would model the same cryptographic Bitcoin but be fiat currency, is another major proof that the future of tech is most likely going to be dominated by digital currencies.
Although the Central Bank Digital currency is not yet officially in use in any country in the world, many Central Banks have launched pilot programs in order to determine the efficiency or viability of the potential CBDC, the Bank of England was reportedly the first to initiate the proposal of a Central Bank Digital Currency in which the Central Banks of other notable countries like China, Sweden, Singapore, Canada, Uruguay, and others are also reportedly looking into the possibility of launching their own CBDC.
The proposed Central Bank Digital Currency will likely leverage on a database run by the central bank, the government, or approved private-sector entities like conventional banks (banks have always operated with a partnership with the government and its financial regulators). Each CBDC unit will act as a secure digital instrument equivalent to a paper bill and can be used as a mode of payment, a store of value, and an official unit of account.
Like a paper-based currency note that carries a unique serial number, each CBDC unit will also be distinguishable to prevent imitation. Since it will be a part of the money supply controlled by the central bank, it will work alongside other forms of regulated money, like coins, bills, notes, and bonds. The central database would keep a record of the amount of money held by every entity, such as people and corporations, it will however also have appropriate privacy and cryptographic protections which is in a bid for it to bring together the convenience and security that is attributed to cryptocurrencies and also the regulated and reserved-backed money circulation of the traditional banking system.
Therefore, it is obvious that the proposed Central Bank Digital Currency is inspired by the obvious successes of cryptocurrencies and the reputation these digital currencies have garnered in short a short period which is a big compliment to these cryptocurrencies.
It’s hard to love Facebook, especially after the Cambridge Analytica scandal. The social media giants also do not help themselves with their glaring competitive moves that out rightly shows that they would do anything to remain the leaders of their industry, however, it’s hard to not admire the business success Facebook has had and how they seem to always know how to operate in spaces that people are almost compelled to subscribe to their services even if one may not like the company itself; take for example the acquisition of Instagram and WhatsApp and how it has massively increased the market share of the company and opened so may revenue streams.
Therefore, it’s no surprise that among the Big Tech companies, Facebook has quickly made attempts to position itself as a player in the digital currency space in the nearest future; Facebook is set to launch its most anticipated digital currency, Diem (formerly Libra), and although due to pushbacks from government, the company has had to drastically review the features of the currency from resembling the exact sovereign currency nature of Bitcoin, to a kind of stable currency that would be tied on a one-to-one basis to various Fiat currency all over the world, the company has still ensured that it would be a player in the Fin-tech, e-commerce and also cryptocurrency space.
The testing of WhatsApp payment channel in countries like Brazil is proof that Facebook is also aware of the increasing need of people to want to carry out most of their activities on one platform, and with a lot of people using the chat platform, the company knows that it would be strategic to implement fin-tech and e-commerce on the platform, a move that can be further boosted with the launch of Libra.
Until the introduction of Bitcoin, decentralization was mostly used in business for describing the franchising system adopted by entities like McDonald’s, however, suddenly, decentralization is a common word in tech these days as technologies like Blockchain or Cryptography are being leveraged and advocated for more use in protecting people’s data.
Everyone, including government entities, agree that people’s data should be secure — as can be seen in the proposed features of the Central Bank Digital Currency (CBDC) — however, the major contention between private financial institutions like Central Banks and Private communities like the Bitcoin communities, is the autonomy people have over their data; Decentralized solutions like Bitcoin are such that people have complete control and autonomy over their data and makes everyone like his/her own financial institutions, thus bypassing any form of a governmental financial institution, something that has been a major reason for the pushbacks from the government. It remains to be seen to what extent the government can resist decentralized structures like that of Bitcoin, but one thing that is certain is that government all over the world are appreciative of cryptography and decentralized structures that protect and secure people’s data, something that the father of the internet, Tim Berners’s Lee, completely agrees with.
Tim Berners’s Lee is regarded as the father of the world wide web and has constantly contributed to the continuous use of the internet as a safe space for everyone, just like he intended it to be. However, due to the constant exploitation of user’s data on the net by some private and even public entities, he felt it was high time he came up with a solution that would make the internet still meet the present and evolving needs of man, but still fulfill its initial purpose of being a place of equal self-actualization for everyone. Hence, his team at Inrupt, have launched a new project called solid that would give people back control over their data (decentralization!). The idea behind solid is to create a platform where every user of the web can create “pods”(Personal Online data stores) to store all their personal data and decide how and to what capacity any application or digital service can use these data; an individual can host this data on a solid server with unique and personal access that can be granted to any application only to read or write on the data on the pod, the consequence of this is that asides the fact that everyone using the Solid pods can decide the data that an app can access, the individual does not need to worry about his/her data remaining with a service provider or application, because every application that uses this data cannot store the data but only read it, so when the user deletes an application there are no traces of that data with the application. Hence, every algorithm on any application used by anyone using the solid ‘pods’, would calculate on the user database without the permission to export the data before using the algorithm for the user’s benefits, an example is maybe an eCommerce platform that can help you decide which clothes would match your taste: the previous model was that you as a user would have your necessary data on the platform, then when it is time for the in-built algorithm to help you make such a decision, the algorithm would leverage on your already stored data or recent activities to make the decision, but in the solid model, the algorithm would not have any access to any form of your previously stored data but would ask for access to the necessary data for that service, which in turn you as a solid user after giving it access, the algorithm can now run the calculation on your data but the e-commerce app would not be allowed to store the data.
It’s amazing how times change and how technology keeps evolving, the reality is the signs all point to a new generation that wants things quicker but are also very conscious of their data and what is being done with it, governments all over the world are yielding to the cries of citizens to protect their data more as can be seen with the recent and continuous series of data issues and policies surrounding big tech companies all over the world, private companies and communities are also coming up with platforms that would meet the new demands of people. Modern tech is penetrating into everything, and even though no one can accurately predict the future of tech and the needs of people, the signs are obvious that the future of technology is decentralization and no one would be surprised if cryptocurrency is right beside it.