Author Image Robbie King

Robbie King

Oct 31 2022

The UK’s Relationship With Web 3

Wide shot looking down on London at night.
Categories: NFTs.
For many people, the problems with Web 2 are glaring and painful. For many of these people, Web 3 is the solution. In one of our previous blogs, we covered the intentions and possible benefits of
Web 3
. Since NFT London is this week, in the following blog, we’ll cover what Web 3 might bring to the UK in practice and what the future might hold.

What effect will Web 3 have on the UK economy?

According to
a report by PwC
, blockchain technology could grow UK GDP by £57 billion by 2030. There are also recent reports that
the UK is the largest crypto economy in Europe
. Here are some of the ways that could be realized.
Blockchain technology offers considerable efficiency gains thanks to its ability to securely store and share data. So for large public sector industries like healthcare and education, ones that store mountains of data on the British people, blockchain should be a game changer.
In terms of benefiting the private sector, the power of tokenization can be harnessed particularly well by the UK economy. The UK is already a world leader in fintech and decentralized finance. It has a thriving startup scene, so the market is already in place.
Blockchain real estate
and tokenization also have the potential to transform an otherwise slow to adapt real estate sector. Tokenization gives entrepreneurs a new, more efficient way of raising capital. And it gives seed investors more options and liquidity to play with than they would have otherwise.
But it’s not just startups that can benefit. Medium to large sized businesses, charities, and even enterprise level businesses won’t say no to avoiding the bureaucracy and high barriers to entry that banks and institutions often put in the way of raising funds.
Another area of the private sector that’s particularly well positioned to capitalize on Web 3 is the UK’s video gaming industry. Since UK game studios are heavily export focused, video games are worth
£7.16 billion
to the UK economy. Gaming and the Metaverse are intimately twinned. The two industries could be almost indistinguishable in a few years. So as the demand for metaverse experiences increases, UK gaming talent will be there to provide it.
Finally, one area that every nation will improve in thanks to blockchain is supply chain management. According to the aforementioned report by PwC, the UK economy could be boosted by £30 billion by the end of the decade thanks to improved tracking and tracing of products. From mining to fashion, industries will have a clearer insight into the goods they use. Those demanding more ethical, sustainable business practices will no doubt welcome this technology.

What problems or gaps will need to be addressed?

It’s pretty safe to anticipate there being a skills gap. There’s already a skills gap in many areas of the tech industry; we don’t have enough devs, we need more UI/UX specialists, etc. This will be even more apparent within Web 3 disciplines since they’re so new. For example, finding a quality smart contract developer is hard since the required language (Solidity) isn’t as widely mastered as something like JavaScript or Python.
There also needs to be adequate buy in from leadership teams. All too often blockchain technology is relegated to some “crazy young person thing” that doesn’t require serious attention. In the words of PwC global blockchain leader Steve Davis.
“It needs C-suite support to identify the strategic opportunity and value and to facilitate the right level of collaboration within an industry. Establishing proof of concept uses which can be scaled up if successful will enable businesses to identify the potential usages of Blockchain while building confidence and trust in its ability to deliver.”

What are the potential risks?

Blockchain technology isn’t as much of a question mark as cryptocurrency. However, cryptocurrency can be inexorable from certain blockchain technologies and is therefore an element of Web 3 that’s hard to avoid.
Cryptocurrency can be highly volatile and if UK institutional investors – or any other country’s investors for that matter – were to bet big on crypto, a crypto crash could have such pronounced effects that other assets will suffer to pay off any losses.

How does the UK Government feel about Web 3?

How they feel about Web 3, blockchain, and crypto could end up being the deciding factor for its ultimate success in the UK. So far the UK Government has been rather bullish. As far back as 2015, they declared their approval of crypto. This was a pretty progressive attitude back then. You can learn about the approach that was taken by the Government to
the UK and blockchain technology here
More recently, in April 2022, the Government set out more plans for further crypto integration. They announced that they wanted to make stablecoins seen as legitimate forms of payment. In the words of then Chancellor of the Exchequer (Finance Minister) Rishi Sunak,
“It's my ambition to make the UK a global hub for cryptoasset technology…
We want to see the businesses of tomorrow – and the jobs they create - here in the UK, and by regulating effectively we can give them the confidence they need to think and invest long-term.”
In the same announcement, the UK Government has stated its plans to explore Distributed Ledger Technology in financial markets. This could facilitate more efficient and transparent data sharing. The government has also stated its interest in making the UK tax system more competitive and nurturing to the cryptoasset market. Full details of these announcements are available
In addition to the April 2022 announcements, there have been several other key votes of confidence for the Web 3 space.

    The UK land registry is interested
Back in 2019 they declared that they wanted to make HM Land Registry digital. In their words, they wanted it to be “the world’s leading land registry for speed, simplicity, and an open approach to data.” Since HM Land Registry provides a state-backed guarantee of ownership, entwining it with a blockchain backed guarantee makes total sense.

    Storing trade documents on the blockchain
The efficiency and security gains offered by blockchain make it a very attractive pitch to governments. In October this year, the Government proposed a bill that would adopt blockchain as the technology for storing trade documents. The Government’s long term goal with this bill is to become paperless. This would have several benefits.
If the bill is approved, it would greatly reduce bureaucracy, with the projected carbon emission reductions being at least 10%. This will also be an efficiency boost, which could (in theory) save taxpayers’ money. Security and compliance is another area for improvement since these e-documents will make record tracing easier.

    The UK’s own NFT
In April 2022, Rishi Sunak asked the royal mint to develop an NFT to represent the country’s 
"forward-looking approach
." A bold move indeed, since NFTs are still considered (by some) to be fringe assets.
The Royal Mint often creates collectible coins here and there so in some ways this isn’t that radical. Still, nothing more has been said about this NFT since. And it’s also come under a fair amount of scrutiny, being
branded a gimmick
by the opposition party.
Nevertheless, Web3 proponents in the UK can take solace in the fact that the man who first put this idea forward is now the Prime Minister.

Final thoughts

Many people still think that blockchain is just a crazy piece of technology, exclusively tied to bitcoin: the world’s biggest geek-money-ponzi scheme. Both the UK Government and its businesses are leading the charge in declaring that blockchain is nothing of the sort.
As one of those businesses, VerseProp couldn’t be prouder. As the platform dedicated to the buying, selling, and renting of metaverse real estate, facilitating your entry into this area of Web 3 is our number one goal.
If you haven’t already, click below to sign up to our mailing list where you’ll be first in line to receive the latest in metaverse and Web 3 educational content, as well as updates on our marketplace, launching in December.