Description
Book SynopsisFrom the coauthor of the bestseller Blockchain Revolution comes the foundational book on cryptoassets, decentralized finance, and the transformation of value. In tune with the crypto Zeitgeist, Alex Tapscott brings us a well-researched and highly accessible book on the peer-to-peer marketplaces and open economic systems that are supporting new digital assets like NFTs, CBDCs, stablecoins, crypto derivatives, and more. Tapscott writes, If bitcoin was the spark for the financial services revolution, then DeFi and digital assets are the accelerant. The fire will engulf firms that fail to innovate, adapt, and embrace this hot new industry. The conflagration will suck oxygen from centralized systems and blow it into a new decentralized web. The financial phoenix that rises will be virtually unrecognizable from the system we have today. This book is about more than dislocating market intermediaries. It's about Web 3's unleashing new business models and organizational capabilities that will transform existing industries and redefine the architecture of our institutions. Leaders ignore these signs at their own risk.
Table of ContentsContents Preface7 Chapter 1: Digital Asset Revolution9 Introduction: The building blocks of disruption10 The rise of digital assets and the future of financial services10 Web 3 and the new Internet of value11 The Golden Nine: Essential functions of the financial industry12 A taxonomy for digital assets14 Decentralized finance is eating Wall Street16 DeFi: A new architecture for the financial system16 The Golden Nine: How DeFi is reimagining Wall Street16 A taxonomy of digital assets28 Cryptocurrencies aka digital money29 Protocol tokens30 Central bank digital currencies33 Non-fungible tokens35 Stablecoins37 Securities tokens40 Governance tokens43 Exchange tokens45 Natural asset tokens46 Implementation challenges of DeFi47 The technology is not ready for prime time47 The energy use is unsustainable48 Governments will stifle or twist it48 Powerful incumbents of the old paradigm will usurp it49 The incentives are inadequate for adoption: The bootstrapping problem49 Blockchain is a job killer49 Governance is like herding cats50 Criminals will use it50 Conclusion: The coming conflagration50 Chapter 2: Cosmos and Polkadot for the Enterprise51 Interoperability in brief51 The challenge of interoperability52 Introducing Cosmos53 Cosmos origins and ethos53 The core technology components of Cosmos54 Metrics of Cosmos success57 Introducing Polkadot58 Polkadots origins and ethos59 The core technology components of Polkadot60 How enterprise can use Polkadot63 The Polkadot ecosystem and its impact64 What do decision makers need to know?65 Key similarities65 Key differences66 Conclusions on interoperability69 Chapter 3: The Promise of Community-Owned Prediction Markets70 Prediction markets in brief70 The promise of prediction markets71 Classic use case: Sports and political betting71 The problems of sportsbooks72 The perils of centralized betting exchanges72 The centralized governance problem74 The future is clear: Community-owned betting markets74 Introducing the crypto network75 Problems with decentralized governance77 Introducing prediction market-based governance79 Governance design for a simple prediction market79 Conclusion: The inevitability of crypto networks82 Chapter 4: Going Cashless with CBDCs82 Webinar in brief82 Introduction: A new paradigm for money83 Disruptive technology makes for new policy options84 Overview of the digital dollar86 How digital currencies differ from other financial assets86 Attributes of the digital dollar87 The need for infrastructure innovation88 Roadmap to a new banking system88 Attributes of a digital global reserve currency89 The goal of modernizing global economic architecture91 The need to modernize global financial regulation92 Conclusions: This is just the beginning93 Diversity makes for a healthy marketplace93 Blockchain will transform other financial assets93 Currency innovation will unleash economic innovation95 Chapter 5: Introduction to Stablecoins96 Stablecoins in brief96 The context for stablecoins97 The economics behind the protocols99 Governance of stablecoins101 Gold or bitcoin, a stable commodity?103 Types of stablecoins104 Asset-collateralized stablecoins104 Non-collateralized stablecoins111 Hybrid stablecoin models113 Top stablecoins114 Tether (USDt)115 USD Coin (USDC)116 Binance USD (BUSD)118 Dai (DAI)119 Frax (FRAX)120 TrueUSD (TUSD)121 Paxos Dollar (USDP)122 Gemini (GUSD)123 Using stablecoins: A few ideas125 Conclusion and review127 Chapter 6: Financial Derivatives with Blockchain and Smart Contracts128 Blockchain-based derivatives in brief128 Derivative contracts on blockchains129 Levels of applications130 Standardization, transparency, and interoperability130 Collateral, settlement, and automation132 Derivatives on public blockchains133 LuxDeco and the worlds first cryptobon
