For some time now I have maintained that the growing adoption of distributed ledger technology will be reflected in the tokenization of currency and digital identity.
Money plays an essential role in every transaction, and its inclusion in a distributed ledger network (DLT) is crucial to harnessing the efficiencies this technology offers. Regulations on the matter already exist, and various alternatives are becoming viable, such as tokenized deposits, e-money tokens, central bank digital currencies (CBDCs), stablecoins and Bitcoin, among others.
Digital identity is another fundamental component for the transition of markets to DLT technology. The use of this technology gives us the ability, to a greater or lesser extent, to have control over our own data, identify ourselves through specific attributes, properly manage the ownership of digital assets and reduce cyber risks. In the European Union, regulation on this matter is about to materialize, and the Digital Identification Services Regulation (DAS 2), covering attributes for all natural and legal persons, is expected to be definitively approved and published during the first half of 2024.
