In the old world, merchant ships, trade routes played an important role in facilitating trade and growth of economies. I suppose that these two things: ocean going ships and trade routes have new meanings in the digital economy.

Bilbo at bag-end deciding to go for an adventure

Just like those individuals and nations that developed these capabilities were able to benefit from new trade, countries that develop new routes for digital world will benefit.

The new digital rails powering the digital economy: underwater internet cables, digital natives, platforms, policy

world economic forum

Digital technologies will power new economies. And just like trade ships and merchant routes in the old world, those who develop competencies and capabilities to anticipate and harness the opportunities will benefit.

It all starts with access to cheap and reliable internet. This is followed by entrepreneurs that try to build platforms that let millions of people share, interact. Then allowing for commerce (trade) in easy and efficient manner. The internet has achieved that and is continuing to do so. I think cryptocurrencies such as Bitcoin also fit in the puzzle in enabling unprecedented new way of transfer and ownership of digital assets. All these need to be backed by evolving cultural shift in terms of laws and new ones formed. Environments that become hostile will see innovators move elsewhere. This has happened in the past.

In the old world, unlike other forms of capitalism that focused on manufacturing and agriculture, merchant capitalism was focused on specific aspect of moving goods from one market to another, mostly from far away lands. This period is mainly dominated by the Dutch and brought about finance related innovations such as insurance, joint stock companies in order to manage risk. Bitcoin is the new merchant capitalism of 21st century that unlocks unprecedented level of internet economy, borderless, censorship resistant store of value and medium of exchange.

Interesting to see how it unfolds.

Gandalf to Bilbo ‘This quest has set in motion, forces we do not yet understand, the riddle of the money and banking system must be understood, we must be careful’.

Mithrandir, Why bitcoin?, ‘I don't know, central systems believe it is great power than can hold evil in check, but that is not what I've found, it is every day incentives of ordinary people, that keep powerful systems at bay’.