What is the future of Hive?
This can be a loaded question with many possible answers. There is, however, one thing that separates it from all else that is out there. Here is where we see Hive stepping in and taking over.
The future of Hive is in the micro. This is a completely new arena that will be developed. It is going to be a variety of financial services that eliminate intermediaries. At the same time, it will integrate with most of what is built.
It is something the present financial system cannot duplicate. For the most part, this is also not possible with most cryptocurrency networks.
This is where Hive can stand out.
Here is the secret.
Micro-Earning
We covered Hive's distribution system so there is no need to delve into that here. What is important is the variety of tokens that will be available.
Year ago, long before the introduction of Hive-Engine, I stated how we would see people receiving dozens of tokens a month. This is something that came true.
In another few years, this is going to reach hundreds. It will increase as more opportunities are created. The introduction of a smart contract platform which allows for tokenized communities will be the basis for this expansion.
Eventually, we are going to see this proceed into the thousands. When decentralized autonomous organizations (DAO) evolve, we are going to see these automated agents paying out in many ways.
Notice the amount of the transaction image above. That is a transaction of 1/10th of a cent. Try that with the existing financial system. In fact, try to send a penny somewhere.
Make the same attempt on Ethereum, Bitcoin, or even BSC.
Micro-earning is already a part of Hive. This is going to expand. We are going to see this applied to social media activity, NFTs in a variety of forms, and infrastructure. Over time, as stated, automation will play a role, structured in DAO that people hold the tokens. The payments from these could be small, but many.
That last sentence is key: we are looking at a shift from one major payment, i.e. a paycheck, to a series throughout the day. On their own, they amount to very little. However, when hundreds (or even thousands) are coming in, that adds up.
Micro-Lending
The idea of a lending platform only makes sense. Once smart contracts are available, it can be set up where people post their tokens as collateral and receive a loan against it.
This is the baseline of financial services. It is also the beginning of the seismic shift that Hive can offer.
We are accustomed to large loans such as those for a home are car. When we are talking tens of thousands of dollars, the existing financial system is adept.
However, this all changes when we get to a few hundred. Cryptocurrency has addressed this to a degree but, again, there are challenges. Most of this is built on the Ethereum network, causing transaction fees to be an issue.
Hive will be able to do lending in much smaller units.
What is someone has $10 in tokens? Since financial intermediaries are removed and transactions are feeless, we can see how this could be used as collateral. Perhaps the individual takes out a $5 loan against the tokens, paid in HBD. There might be a small fee for the application but it is minimal.
The pieces for something like this are being built.
Micro-Investing
What does the person do with the $5 loan?
Here we can see micro-investing entering the equation. We know the existing financial system is not suited for this level of activity. Yet, with Hive, we can handle it just fine.
A token swap can be of any level. We can see the transactions of even .001 HBD being processed. Hence, $5 is a large amount in comparison.
This might sound like a senseless proposition yet, if we consider the implications in the DAO context, it makes total sense.
Perhaps this individual puts $1 into 5 robo-taxis in different cities. The token pays a 20% yield, far outpacing the payments associated with the loan.
Micro-Funding
Another piece to this puzzle is micro-funding.
I want to raise $250K for my generative AI feature length film I am creating. Today, I have the choice to try and get the money from some venture capital firm. Outside of this, I could go to some big money players and try to get a couple of them to invest.
Another option is to offer tokens in the project. This could be done in any amount of Hive. To meet the total, 250K people putting up $1 is sufficient. Or we could have 2.5 million posting .1 HBD. How about 25 million using .01 HBD?
The point is that we can get people involved at any level. Since the payouts are driven by the smart contract, the individual percentage is calculated and distributed. Of course, there might need to be a minimal level of payout according to the token used (if not HBD).
This could be used for much smaller projects. What if a farmer in Kenya needs $50 for seeds. We saw micro-lending platforms in the past. However, nothing brings to the table what blockchain does.
Micro Financial Services
Hive could bring financial services to the world. Part of the problem with the [unbanked)](@leoglossary/leoglossary-unbanked is they have no access to these wealth and business building tools. They are completely cut off.
Even if they did gain access, much of the world does not operate at a level where it could afford to participate. Most think about thousands of dollars when doing these types of transactions. Unfortunately, the majority of the population operates at the ten or, perhaps, hundred dollar level.
Here is where inclusion is derived.
We know the present system is never going to arrive at this. The financial institutions that are cemented in as intermediaries are not going to give up their cash cow. At the same time, governments are going to keep pushing regulation to assess control. This means pushing services in the hands of the corporations they are accustomed to. This is why the likes of Gary Gensler are looking to hand cryptocurrency over to Wall Street.
What Hive can construct is decentralized finance (DeFi) at its finest. It also can create a network of financial services that can include anyone.
Consider the process:
Someone engages in micro-earning. Those proceeds are used as [collateral)](@leoglossary/leoglossary-collateral for a micro-loan. From there, one can micro-invest with someone who is doing some micro-funding.
The ability to make transactions at the smallest of levels makes this possible. With a sidechain that offers a similar staking in lieu of transaction fees, this is a system that could be designed on Hive.
So far, there are few other options for it.