[TL;DR]
- A structural shift is underway to return ownership of data and rights to revenue distribution—once monopolized by Big Tech—back to individuals who actually generate value.
- Through smart contracts and governance tokens, transparent and fair profit sharing is automatically executed without intermediaries, while user-friendly interfaces like WaaS completely abstract away the underlying technical complexity.
- Every form of personal asset—knowledge, creative works, personal data, and even daily activity—is being tokenized and converted into economic value, empowering individuals to participate freely in economic activities without platform dependency through decentralized identities.
1. The Limits of the Traditional Platform Economy: Centralized Power and Unfair Value Distribution
1.1. Big Tech's Monopoly: The True Value Taken by Platforms
What do Facebook, Google, Amazon, and Apple—all used by billions daily—have in common? These companies have accumulated the most wealth in the world without directly producing goods or services. Facebook doesn’t create content but profits from it. Google doesn’t produce information but earns from access to it. Amazon rarely manufactures products itself but generates enormous profits through sales intermediation.
The core of this structure lies in their monopolistic position as intermediaries. These platforms have built ecosystems where all transactions must pass through them, placing themselves between producers and consumers. YouTubers can't reach viewers without YouTube, Amazon sellers can't meet customers without Amazon, and Facebook users can hardly communicate with friends outside the platform.
This monopolistic intermediary structure is problematic because it results in extremely unfair revenue distribution between platforms and those who actually create value. A YouTuber whose video gets a million views might earn about 1 million KRW (roughly $800), while YouTube (Google) makes significantly more in ad revenue from that same video. An Amazon seller with 100 million KRW in monthly sales may pay 15–30% in fees, yet Amazon contributes little beyond warehouse operations and delivery services.
Even more shocking is that this imbalance deepens as platforms grow. The larger the platform, the more users it attracts. As more users gather, individual creators and sellers lose bargaining power. When YouTube unilaterally changes revenue shares or Amazon raises its fees, creators and sellers—who have no alternatives—are forced to accept it. The growth of the platform only strengthens the power of the intermediary, while reducing the relative share for those who actually create value, perpetuating a vicious cycle.
1.2. What Creators and Users Lose: Data Ownership and Revenue Distribution
The issue of unfair revenue sharing under platform monopolies is fundamentally tied to a more serious issue: the deprivation of data ownership. In the current platform economy, all user-generated data—personal information, interests, behavioral patterns, social graphs, and content—becomes the property of the platform. A Facebook user's ten years of friendships and memories, an Instagram influencer's years of cultivated followers, or a LinkedIn professional’s industry network are all tied to the platform and beyond full control of the user.
The most immediate harm from this data dependency is that users lose all assets when switching platforms. A TikTok creator cannot bring their followers to YouTube, an Instagram store cannot transfer customer data to an independent website, and LinkedIn networks cannot be used on another platform. Digital assets built over years of effort disappear the moment users leave the platform.
Even worse, users receive none of the enormous economic value created by their data. Google earns tens of trillions of KRW annually from advertising, thanks to billions of users providing search data and behavioral patterns. Facebook’s advanced targeted ads are made possible by personal information and interest data voluntarily shared by users. Yet the very people who generate this value receive no financial compensation.
For creators, this lack of data ownership is even more damaging. YouTube creators can't access their subscriber data, Instagram influencers don’t get full analytics on their followers, and TikTok creators are denied complete insight into viewership patterns. This prevents creators from building independent business models or expanding to other platforms, deepening their dependence on the original platform.
Such data dependence also leads to a loss of privacy control. Users lack meaningful control over how their sensitive information is collected, shared, and used. It’s practically impossible for the average user to fully understand and manage the complex privacy policies platforms provide. Even if consent is withdrawn, it’s difficult to ensure complete deletion or halting of collected data usage.
1.3. The Trap of Platform Dependency: A Digital Economy Without Choice
The loss of data ownership leads to platform dependency, trapping users in a “digital economy without choice.” Today’s platforms form isolated “digital kingdoms” that are difficult to escape once entered. Apple users find it hard to switch to Android. Google service users are reluctant to adopt alternative search or email tools. Amazon Prime members have little incentive to use other shopping platforms.
The key mechanism driving this deepening dependency is the artificial increase in switching costs. Platforms deliberately limit compatibility and complicate data transfer to make migration difficult. KakaoTalk chat history can’t be transferred to Telegram. Netflix watch history and recommendations can’t be used on Disney+. Spotify playlists can't be perfectly moved to Apple Music—these are all intentional design choices.
More subtly, platforms encourage voluntary dependency under the name of “convenience.” Google links search, email, maps, cloud, and video platforms under one account, making it hard to leave. Amazon packages Prime delivery, video streaming, cloud services, and voice assistants to integrate itself into users' daily lives. Even if better alternatives exist for individual services, users continue with suboptimal choices due to this bundled convenience.
This dependency is even more harmful to creators and businesses. An Instagram influencer with hundreds of thousands of followers may lose reach after a policy change and find no viable alternative. A YouTuber accustomed to optimized content creation can’t easily replicate success on other platforms. Brands thriving on Amazon Marketplace struggle to drive traffic to independent stores.
The most serious consequence of platform dependency is the suppression of innovation. When platforms monopolize the market, even new services that emerge struggle to attract users. Users hesitate to leave established platforms where their data and networks reside. New platforms can't secure enough users to be competitive, creating a vicious cycle where platform monopolies are reinforced and true innovation is stifled.
1.4. The Vicious Cycle of Intermediary Fees: Why Are We Taxed on Every Transaction?
The monopoly created by platform dependency inevitably leads to rising “digital taxes” in the form of intermediary fees. App store commissions of 30%, Amazon seller fees of 15–20%, YouTube’s 45% ad revenue share, and Uber’s 25–30% cut—all stem from monopolistic positions. What's more troubling is that these rates tend to increase over time. Platforms attract users with low fees initially, but raise them after securing market dominance.
The problem isn’t just high fees—it’s the extreme imbalance between service provided and fee charged. App stores provide server operation and payment processing, but the actual cost is far below 30% of revenue. The rest is pure “monopoly rent”—excess profits stemming from market dominance. Amazon’s logistics services also charge disproportionately high fees, especially for digital products where physical costs are minimal.
This vicious cycle of intermediary fees creates systemic problems that suppress innovation and increase consumer prices. A developer paying 30% to the app store must raise app prices. Amazon sellers pass on high fees to consumers through higher product prices. Uber’s high platform fees lead to fare hikes or lower driver income, hurting service quality.
Worse still, this fee structure undermines economic efficiency. It inserts unnecessary middlemen between creators and consumers, increasing transaction costs and reducing market transparency. A creator could earn more and offer lower prices through direct sales to fans, but platform intermediation makes this impossible.
To break this cycle, a fundamentally new paradigm is needed. We need systems where participants who create real value set fair rules and share value transparently—not centralized platforms unilaterally setting fees. This is precisely where the protocol economy and its decentralized model of value creation and distribution emerge as viable alternatives to the traditional platform economy.
Ultimately, today’s platform economy is caught in a vicious cycle where monopolistic intermediation, unfair value distribution, data exploitation, artificial dependency, and excessive fees reinforce one another. Solving these issues requires not just regulation or improvement, but a paradigm shift that restructures the power dynamics. The protocol economy presents a compelling answer to this challenge.
2. The New Paradigm Proposed by the Protocol Economy
2.1. Decentralized Protocols: True Value Creation Centered on Participants
At the core of the protocol economy—emerging to overcome the structural limitations of the traditional platform economy—is the aim to eliminate centralized intermediaries and build systems where participants directly create and distribute value. In traditional platforms, companies like Facebook, Google, and Amazon controlled all rules and profit allocation. In contrast, the protocol economy replaces these intermediaries with systems that operate automatically according to pre-defined rules (protocols). This is not just a technological change—it represents a fundamental redistribution of economic power.
The most revolutionary aspect of protocols is that they offer transparent and predictable rules based on the principle of “code is law.” Traditional platforms could change policies unilaterally at any time. But protocols operate via smart contracts deployed on blockchains, making it impossible for any single party to arbitrarily change the rules. For example, Uniswap—a decentralized exchange—has a fixed trading fee of 0.3%, and any change to this requires a democratic vote by token holders. This fundamentally prevents the typical pattern of fee hikes seen in traditional platforms after growth.
Based on this transparency, the protocol economy implements a fair value distribution mechanism based on actual contributions. While intermediaries captured most of the value in traditional platforms, in the protocol economy, participants who actually create value are rewarded accordingly. For example, in the decentralized content platform Mirror, all proceeds from NFT publications go directly to the creator, with the platform merely providing infrastructure and taking no share. In DeFi protocols like Compound, users who provide liquidity share transaction fees, redistributing profits previously monopolized by centralized exchanges.
The true innovation of the protocol economy lies in the democratization of network effects. In traditional platforms, only the platform benefited as users increased. In protocols, growth benefits all participants. Just as all ETH holders benefit from the growth of the Ethereum network, the success of a protocol becomes shared success for everyone involved. This represents a fundamental shift from a “platform vs. user” structure to a “growing together as a community” model.
Furthermore, the protocol economy lowers entry barriers, enabling anyone to participate in innovation. Competing with Google or Facebook traditionally required billions of dollars and thousands of employees. But protocols, being open-source, allow anyone to build new services on top. Just as hundreds of decentralized exchanges have been built on Uniswap’s code, protocols serve as foundations for more competition and advancement.
2.2. Fair Revenue Distribution Guaranteed by Smart Contracts
The key mechanism that enables decentralized protocols to function in practice is the automated revenue distribution system through smart contracts. In traditional platforms, revenue distribution involved human judgment, delays, and potential manipulation. Smart contracts, on the other hand, execute automatically when pre-defined conditions are met, ensuring fair and interference-free distribution. This represents a revolutionary shift from trusting people to trusting code.
A direct benefit of smart contracts is immediate settlement, which improves cash flow. Traditional platforms often pay out on a monthly or quarterly basis, causing liquidity issues for creators and sellers. Smart contracts distribute revenue the moment a transaction occurs. When an NFT is sold on OpenSea, the creator instantly receives the proceeds. When a trade happens on Uniswap, liquidity providers immediately receive fees. Settlement cycles that used to take 30–60 days are reduced to seconds, significantly improving financial stability—especially for small creators.
More transformative is the complete automation of complex revenue sharing structures. Whereas revenue allocation among multiple parties used to be opaque and cumbersome, smart contracts execute even the most complex logic transparently and accurately. For instance, revenue from a music NFT can be automatically split as: composer 40%, lyricist 30%, producer 20%, platform developer 10%. Game item royalties to original developers can also be executed error-free. Such automation builds trust among participants and prevents disputes at the root.
Smart contracts also enable new business models through conditional revenue sharing. Instead of sharing revenue only upon sales, dynamic distribution can occur based on various conditions. For example: “bonus payout upon reaching 100,000 subscribers,” “additional rewards when monthly volume targets are met,” or “tiered incentives based on community engagement.” These conditions can be pre-programmed into the contract, and rewards are automatically distributed upon fulfillment.
The transparency of smart contracts allows for full auditability of revenue sharing. Traditional platforms operate as black boxes in this regard, but smart contracts permanently record all transactions and distributions on-chain for anyone to verify. Creators can see how much their work sold for, what fees were taken, and whether distributions were made correctly. This transparency significantly boosts trust in the system.
Moreover, smart contracts eliminate the barriers to global revenue sharing. Traditional international revenue distribution is hindered by complex banking systems, high fees, and long processing times. Smart contracts enable real-time revenue sharing to wallets worldwide under uniform conditions. A Korean game developer, an American artist, and a European marketer can co-create an NFT project and receive instant revenue distribution to their respective wallets. This forms the basis of a truly global collaborative economy.
2.3. Token Economy: A Democratic Reward System Based on Contribution
With automated revenue distribution enabled by smart contracts, the protocol economy builds a new value measurement and reward system based on tokens. While traditional platforms used simple metrics like “likes” or “views” to measure contribution, the token economy offers a more sophisticated and fair incentive system through token rewards that reflect real economic value creation. This goes beyond point systems to create a full-fledged economic system encompassing financial rights and governance power.
At the heart of the token economy is a differentiated reward mechanism for various forms of contribution. In traditional platforms, only direct revenues like ads or subscriptions were rewarded. In token-based systems, all activities contributing to the ecosystem—content creation, community building, curation, marketing, technical development—are rewarded with tokens. For example, on Steemit, users receive tokens for writing quality content or curating good content. On Discord servers, active community members receive governance tokens, giving them the right to participate in decision-making.
The value of tokens is directly linked to the success of the protocol, aligning all participants’ interests. Users of traditional platforms helped them grow but received none of the benefits. Token holders, however, benefit from protocol growth through appreciation of token value. Early users of Uniswap who received UNI tokens via airdrop shared in the protocol’s success. The token economy creates an “ecosystem of shared growth,” shifting users from passive consumers to co-owners of the ecosystem.
Another innovative aspect of the token economy is the design of incentives for long-term contribution. Mechanisms like staking encourage long-term commitment over short-term speculation. For instance, creators who stake tokens on content platforms get higher exposure, and users who contribute consistently over time receive greater governance power. This transforms the short-term attention competition of traditional platforms into a competition for long-term value creation.
Tokens serve not just as rewards but also as tools of economic governance. Token holders vote on key protocol decisions, and their influence is proportional to the number of tokens they hold. This transforms decisions traditionally made unilaterally by platform operators into democratic processes governed by the community.
The token economy also introduces a new standard for global value exchange. Tokens from different protocols are freely traded on decentralized exchanges, allowing value generated in one ecosystem to spread across the entire crypto economy. One could buy art NFTs with tokens earned in a game or provide liquidity in DeFi using tokens earned from social media. This enables the seamless flow of value and integrates fragmented platform economies into one unified global digital economy.
2.4. Interoperability: Free Value Movement Across Platform Boundaries
The new value system built by the token economy leads to a revolution that breaks down platform boundaries through interoperability between protocols. In the traditional platform economy, each platform was a siloed “digital kingdom” that locked in users. In contrast, the protocol economy enables different protocols to combine like Lego blocks to generate greater value. This interoperability provides true freedom of choice for users, accelerates innovation, and maximizes ecosystem efficiency.
The most basic form of interoperability is the free movement of assets. In traditional systems, Facebook game items can’t be used on Instagram, and YouTube subscribers can’t be transferred to TikTok. But in the protocol economy, digital assets represented as NFTs are recognized across multiple platforms. A weapon NFT acquired in one game can be used in another, an NFT purchased on an art platform can be displayed as a profile on social media, and music collectibles can be showcased in metaverse spaces.
A more advanced form of interoperability appears in the portability of identity and reputation. With decentralized identity (DID) systems, users can leverage a single digital identity and reputation across various protocols. Trust and transaction history earned on one platform are recognized on others, eliminating the need to rebuild credibility from scratch when using a new service. This provides users with true freedom to move and choose platforms.
Protocol composability creates a new paradigm for innovation. Developers can rapidly build new services by combining existing protocols like Lego. For instance, Uniswap’s trading functions, Compound’s lending features, and Aave’s insurance mechanisms can be combined into a new financial product. Or, a new social media platform could be built by composing a social graph protocol, content storage protocol, and payment protocol. This composability significantly increases development speed and allows small teams to compete with large corporations.
Interoperability further expands through cross-chain ecosystems enabling broader connectivity. Assets and data can now move freely between blockchains like Ethereum, Polygon, and Solana, enabling hybrid applications that combine the strengths of each chain. For example, an application might leverage Ethereum’s security, Solana’s speed, and Polygon’s low fees—all in one seamless experience. Users can enjoy optimal services without even being aware of which chain they’re using.
The ultimate vision of interoperability is the realization of the “Internet of Value.” Just as the current internet enabled the free flow of information, the protocol economy allows for the free flow of value. All digital assets, reputations, and relationships created by users are owned by the users themselves—not locked into platforms—and can be freely moved to better services. This fundamentally prevents platform monopolies and fosters a healthy digital economy ecosystem driven by constant innovation and competition.
Ultimately, the new paradigm proposed by the protocol economy is an organic transformation—beginning with a decentralized, participant-centered system, extending to fair distribution via smart contracts, democratic governance through tokens, and finally, unrestricted value movement through interoperability. By combining these changes, the protocol economy structurally solves the core problems of the traditional platform model—monopolistic intermediation, unfair value distribution, data lock-in, and innovation suppression—creating a digital economy where all participants can fairly create and share value.
3. Sector-Specific Use Cases of the Protocol Economy
3.1. Innovation in Content and Intellectual Property: Protocolizing Creator Rights and IP Utilization
While the tokenization of knowledge economy allows individuals to turn their expertise into assets, the creative field is undergoing a fundamental restoration of creator rights through the complete protocolization of content and intellectual property (IP). In the traditional entertainment industry, publishers, film studios, and game companies acquired creators’ IP under highly unfavorable conditions and monopolized all derivative profits. Even if a web novel generated tens of millions of dollars by being adapted into a webtoon or drama, the original author would receive nothing beyond the initial payout. However, blockchain-based open protocols now present a new paradigm where creators fully own their IP and unlock various opportunities for its utilization.
At the heart of this change is the atomization of content IP, enabling granular rights management. A novel or webtoon can have its main characters, worldbuilding, and key items minted as individual NFTs, which can then be independently licensed. A game studio may purchase usage rights to a specific character NFT, or a webtoon creator may license just the worldbuilding NFT while creating new characters. In every case, the original creator automatically receives royalties via smart contracts, eliminating the need for complex contract negotiations or manual management.
This granular IP management evolves into an open creative ecosystem through collaborative storytelling protocols. The original creator partially opens up their universe, allowing others to produce derivative works while receiving a proportional share of revenue from each success. For example, side stories are written by other authors, fan art is created by illustrators, and mobile games are developed by indie studios—all while the original creator receives royalties relative to each work’s performance. This is a groundbreaking evolution that elevates fanfiction and doujin culture into an official revenue-generating economy.
Even more exciting is the model where fans become co-owners of the IP ecosystem. Fans can purchase fractional ownership of character NFTs and receive a share of the revenue generated by derivative works featuring that character. They can also vote—proportionally to their stake—on decisions such as character redesigns or how the IP is used in future works. Fans thus shift from passive consumers to active participants in IP development. This forms a collaborative creative economy where original creators, fans, and derivative creators grow together.
An automated IP protection system combining AI and blockchain underpins the safe operation of such an open ecosystem. As soon as a creator publishes a new character or world, it is timestamped and registered on-chain to ensure automatic copyright protection. AI continuously monitors the web for unauthorized use and initiates responses in real time. Smart contracts can propose licensing terms or initiate legal action automatically, allowing creators to focus solely on creativity without worrying about rights protection.
Full automation of cross-media expansion is the ultimate goal of this protocolized IP management. A web novel is adapted into a webtoon, then into a game and drama, and finally localized for overseas markets—all while the original creator receives fair revenue automatically at each step. Even if an AI translates or generates new content based on the original work, the creator's rights are preserved and royalties distributed accordingly. When IP characters or items are used in the metaverse or NFT games, real-time royalty settlement ensures creators are compensated every time their work is utilized in any form.
3.2. The Transparency Revolution in Supply Chains: Direct Connections Between Producers and Consumers
Just as IP protocolization in the creative sector connects creators and fans directly, the protocol economy is bringing another transformation in the physical goods sector—complete transparency in supply chains enabling direct trade between producers and consumers. In traditional supply chains, products from farmers or factories pass through multiple intermediaries before reaching consumers, inflating prices while producers receive only a small portion of the final sale. Blockchain-based supply chain protocols now enable end-to-end traceability, drastically reducing middlemen and allowing more revenue to go directly to producers.
This transformation begins with a system where every stage of production and delivery is tracked via NFTs. For example, an organic tomato grown on a farm is tracked from seed to harvest, packaging, transportation, and sale—with every step recorded on the blockchain. Data such as temperature, humidity, and transportation conditions is automatically collected via IoT sensors and stored immutably. With a single QR code scan, consumers can see the full provenance of a product—who grew it, where, and how. This transparency builds trust and allows quality producers to command premium prices.
Values such as sustainability and fair trade are certified and traded as tokens, creating financial incentives for ethical production. Products made in carbon-neutral ways, or under fair trade conditions, receive corresponding value tokens. Consumers who care about these values willingly pay a premium for such products, and the premium goes directly to the farmers or producers who implement sustainable practices. This incentivizes long-term behavior change toward more responsible production.
This value-based trading extends into crowdfarming models where consumers pre-order or invest directly with producers. Consumers may pre-pay for crops that haven’t even been planted yet, giving farmers stable upfront capital. They may also purchase tokenized shares of a farm, securing rights to a portion of the future harvest or long-term investment in new breeds or equipment. This financialization of agriculture ensures stable income for farmers and safe, trustworthy food for consumers—a true win-win.
Real-time optimization of global supply chains is another innovation enabled by protocol-based transparency. Producers, transporters, and retailers across the world share real-time information through a common protocol, enabling AI to calculate the most efficient delivery routes. Coffee beans harvested in Brazil can be routed optimally to a Korean roastery. As variables like weather or shipping delays arise, the system automatically recalculates alternatives and adjusts compensation for each participant, greatly improving overall efficiency and resilience.
Reverse sharing of consumer data creates additional value in transparent supply chains. Traditionally, producers had little insight into consumer preferences or reactions. But through protocols, consumers can voluntarily share product reviews or preference data, helping producers develop better products. In return, consumers are rewarded with tokens for their data, while producers gain actionable insights—forming a positive feedback loop of better goods and more satisfied customers.
3.3. Personal Data Sovereignty: An Economy Where You Earn from Your Own Data
While transparency transforms the value chain of physical goods, the most dramatic change in the digital economy is the emergence of a data sovereignty economy, where users fully own and control their personal data. Today, the core asset driving trillions of dollars in annual revenue for tech giants like Google, Facebook, and Amazon is user-provided data—offered freely and often unknowingly.
User search histories, location data, purchase behavior, and social activity all power personalized services and highly targeted ads—but the individuals generating this data receive no share of the value it creates. In the protocol-based data economy, however, individuals retain full ownership of their data and can sell it directly to companies or research institutions that need it—receiving fair compensation.
Tokenized direct trading of personal data lies at the heart of this shift. Health data, movement patterns, purchase habits, and learning history can be encrypted, anonymized, and tokenized for trading in data marketplaces. If a pharmaceutical company needs health data from patients with a certain condition, it can pay those individuals tokens to acquire anonymized data. Individuals retain privacy while earning fair value, and companies gain transparent, legitimate access to high-quality data.
This direct model evolves into royalty-based compensation for AI model training contributions. If an AI voice recognition model succeeds commercially thanks to user-submitted voice data, those contributors receive a share of the profits. If self-driving technology is trained using driving data provided by users, micro-payments are made to the original data providers every time that data is used. This builds a fair AI economy where all contributors share in the outcome.
Privacy-preserving data utilization via zero-knowledge proofs (ZKPs) ensures safety in the data economy. Individuals can prove they meet specific criteria without revealing personal details. For example, a marketing firm may seek consumption data from “high-income males aged 25–35.” Matching users can cryptographically prove group membership without disclosing income or age, while sharing anonymized data. ZKPs strike the perfect balance between privacy and utility.
The protocol economy also creates a new profession in active management of personal data portfolios. Individuals act as “data asset managers,” strategically optimizing and selling different types of data—fitness data to health apps, learning data to edtech firms, consumption data to marketers—adjusting access and pricing based on market conditions. This creates a new revenue stream from everyday activity, while companies benefit from richer, more accurate data.
Collective bargaining power from group data sharing completes the picture. While an individual’s data may hold little value, groups with shared characteristics gain substantial leverage. Patients with a specific disease can form data cooperatives to negotiate with pharma companies. Local communities can provide lifestyle data for urban planning in exchange for better deals. This group-based approach protects personal data sovereignty while promoting meaningful, socially beneficial data use.
4. The Technological Infrastructure Behind the Protocol Economy
4.1. Governance Tokens: Rules Created by the Participants Themselves
While blockchain provides the technical foundation for decentralization and trust, a democratic decision-making system enabled by governance tokens offers the social mechanism that ensures fair and transparent economic activities on top of that infrastructure.
In traditional platforms, CEOs and executives made all major decisions. In the protocol economy, token holders vote directly on the future direction of the protocol. This isn’t just a user feedback system—it represents a real redistribution of economic power, creating new organizational models where participants in the knowledge, creative, supply chain, and data economies all hold true ownership and control.
The most direct impact of governance tokens lies in the democratic adjustment of protocol parameters to establish fair rules. On a knowledge platform, this might mean adjusting the token reward ratio for expert answers. On an IP trading platform, it could be modifying royalty distribution rules. In supply chain protocols, it might involve updating quality certification standards—all determined by token holder votes.
Each token holder receives voting rights proportional to their holdings, and proposed changes that pass a certain approval threshold are automatically reflected in smart contracts. This ensures that every aspect of protocol operations is conducted under transparent, predictable rules, while blocking arbitrary decisions by specific groups.
Delegated voting systems that balance expertise and participation are key to ensuring that democratic governance functions effectively. Since not every token holder has the technical knowledge to make informed decisions on complex matters, they can delegate their votes to trusted experts or institutions.
For example, in a personal data economy, users may delegate votes on privacy policy changes to privacy professionals. In a supply chain platform, logistics experts might be entrusted with decisions related to transportation protocols. This hybrid model—combining direct and representative democracy—allows users to participate without burden while ensuring that specialized decisions reflect proper expertise.
The deeper value of governance tokens lies in the alignment between token holders' economic incentives and the long-term development of the ecosystem. Since the value of their tokens rises with protocol success, holders are motivated to make decisions that support sustainable growth. Token holders on a creator IP platform, for example, may support policies that increase creators’ revenue because doing so attracts better talent and increases the platform's overall value. Poor decisions that hurt the protocol also damage token value, encouraging responsible and thoughtful voting behavior.
Sophisticated governance mechanisms that reflect the voices of diverse stakeholders are evolving to strengthen token-based democracy. Instead of allocating voting power purely by token quantity, some protocols introduce weighted voting that considers usage levels, contribution history, or participation duration. Others assign different voting rights to different stakeholder groups (e.g., developers, users, investors).
On a knowledge economy platform, experts, learners, and developers may all hold distinct weighted votes. In the data economy, data providers, data buyers, and privacy advocates may each have authority over different policy areas. This helps prevent vote monopolies by a few large holders and ensures diverse perspectives are reflected in decision-making.
4.2. Wallet-as-a-Service (WaaS): A User Interface that Hides Complexity
While governance tokens ensure fair protocol operation, user-friendly interfaces that abstract away blockchain’s complexity are essential for mass adoption of these innovative systems.
This is where Wallet-as-a-Service (WaaS) emerges as the core infrastructure that connects the protocol economy with everyday users. WaaS hides the technical complexities of private key management, gas optimization, and transaction execution, enabling users to participate in services such as token rewards in the knowledge economy, royalty distribution in IP, supply chain traceability, and data monetization—all with the same ease as using a typical Web2 app.
The most important innovation of WaaS is complete simplification of blockchain wallet creation and management via social login. Previously, a developer wanting to receive expertise tokens had to memorize seed phrases and securely store private keys. With WaaS, a simple Google or Apple login automatically creates and manages a blockchain wallet in the background.
Creators minting NFTs for their IP, farmers registering products on a supply chain platform, or individuals selling their personal data in a marketplace can all use services without any knowledge of blockchain or private keys. Services like Magic and WalletConnect are already delivering these seamless onboarding experiences, playing a key role in making the protocol economy accessible to the public.
Unified management of multi-chain assets is another core value WaaS provides. The protocol economy spans across multiple chains like Ethereum, Polygon, and Solana, making it cumbersome for users to manage separate wallets and gas fees for each.
With WaaS, users can manage all their assets in one interface—from knowledge economy tokens and IP royalties to supply chain rewards and data sales income. Users don’t need to worry about which chain a token is on, how much gas is needed, or how to bridge across networks. WaaS handles all of this in the background and processes transactions along the optimal route.
Gas fee optimization and automated handling systems further enhance the user experience. WaaS automatically sets and manages gas fees, which are often a pain point for users. Whether receiving tokens for expert answers, IP licensing revenue, supply chain certifications, or personal data sales, users don’t have to deal with complex gas configurations. Innovations like meta-transactions allow users to make blockchain transactions without paying gas fees themselves, or pay them using alternative tokens they hold.
Batch transactions and simplified smart contract interactions are advanced WaaS features. When executing complex strategies involving multiple protocols, dozens of transactions can be bundled into one batch for a single approval. For example, a user could invest knowledge economy tokens into a creator IP fund, and then use the returns to improve their personal data portfolio—all in one transaction. This saves gas and significantly improves the user experience.
WaaS’s ultimate goal is to deliver Web2-level UX with invisible blockchain. Users should enjoy the benefits of protocol-based applications without ever needing to understand that blockchain is involved. Social recovery for account access, biometric approvals for transactions, optimistic UI that feels instant, and seamless integration of off-chain and on-chain data all contribute to enabling users to fully enjoy knowledge, creative, supply chain, and data economy services without technical hurdles.
4.3. Decentralized Identity Management: User-Owned Digital Identity
While WaaS enhances accessibility, Decentralized Identity (DID) systems ensure that the protocol economy leads to genuine freedom and rights for individuals.
In traditional internet services, platforms like Google, Facebook, or Kakao controlled users' identities. In contrast, DID allows professionals in the knowledge economy, artists in the creative economy, producers in the supply chain, and individuals in the data economy to fully own and control their digital identities. This goes beyond a new login method—it’s a fundamental expansion of digital rights and freedoms.
At the core of decentralized identity is the principle of Self-Sovereign Identity (SSI), which gives participants true digital freedom. A knowledge economy expert can issue credentials proving their expertise without approval from centralized institutions, selectively disclose information, and retain full control to update or withdraw credentials at any time.
Through services like ENS (Ethereum Name Service), creators can replace complicated wallet addresses with easy-to-read names like “artist.eth” and manage all associated information (portfolio, social links, licensing terms) freely. Farmers can use “farmer.eth” to manage farm info, certifications, and production records. Data providers can organize their data portfolios under a DID like “dataprovider.eth.”
The Verifiable Credentials (VC) system makes this self-sovereign identity economically useful. Skills acquired in the knowledge economy, published works in the creative sector, quality certifications in the supply chain, and trust scores in the data economy can all be cryptographically stored on-chain and presented anywhere. A computer science degree, open-source contributions, copyright records, organic farming certificates, and data reliability scores can all be linked to a unified digital identity—removing the need to build trust from scratch with each new interaction.
This integrated credential system enables cross-platform reputation systems. In traditional systems, your reputation on one platform didn’t carry over to others. With DID, expert ratings in knowledge platforms, creator trust in IP platforms, producer quality scores in supply chains, and trust scores in data markets all combine into a unified reputation profile. When joining a new service in the protocol economy, a user’s past activity ensures better terms and more opportunities.
Zero-Knowledge Proofs (ZKPs) for privacy protection are one of the most innovative features of decentralized identity. Participants can prove certain conditions are met without revealing sensitive personal data.
For example, an expert in the knowledge economy could prove they have “5+ years of AI experience” or hold “a PhD degree” without disclosing exact credentials. In the data economy, someone can sell data under a “high-income” label without revealing their salary. This ensures validation without compromising privacy—an ideal balance.
The ultimate vision of decentralized identity is the realization of true digital citizenship. Regardless of national borders or platform policies, individuals can express expertise in the knowledge economy, monetize IP in the creative sector, trade goods in supply chains, and sell data—all based on a single self-owned digital identity.
A persecuted expert can safely share knowledge and earn income. A creator in a developing country without a bank account can participate in the global IP market with just their digital identity. Just as the internet democratized information, decentralized identity democratizes economic and social participation.
Moreover, decentralized identity serves as an integration layer that connects all areas of the protocol economy. Expertise gained in the knowledge economy can support IP collaboration. A reputation built in creative work can validate supply chain credibility. Transparent transaction history in supply chains can strengthen trust in data economies. Over time, a user’s entire economic activity accumulates and compounds under a single identity—unlocking greater opportunities and better terms.
This integrated digital identity built on decentralized identity elevates personal economic sovereignty to a completely new level. No longer subject to platform policies or institutional control, individuals fully own all the value and trust they create, and can freely convert it into economic value anywhere in the world. It means becoming a truly free digital citizen—someone who has full control over their knowledge, creative work, production activity, and personal data, and can use it to realize complete personal economic sovereignty.
5. The New Future Shaped by the Protocol Economy
The protocol economy is still in its early stages, but it is already spreading rapidly across the world, driving a fundamental transformation in the existing economic structure. The most significant change is the redistribution of economic power. Ownership of data, rights to revenue distribution, and decision-making authority—previously monopolized by a few platform giants—are now being returned to the individuals who actually create value. This shift marks the beginning of true economic democratization.
However, this transformation will not be without resistance. The greatest challenges will come from incumbent platform companies and concerned regulators. Existing businesses that rely on trillions of won in intermediary fees will see the protocol economy as a direct threat to their profit model, and they will likely deploy various strategies to block its spread. Governments may also strengthen regulations out of fear of losing control over decentralized systems.
Improving technical maturity and user experience is another key task. The current blockchain infrastructure still lacks the scalability and usability required for mass adoption. While user-friendly solutions like WaaS are rapidly evolving, further innovation is needed to make these systems as easy to use as traditional platforms for the average person.
Nevertheless, the core value proposition of the protocol economy is so powerful that these obstacles are likely to be overcome. An economy where creators own the full value of their work, individuals earn income from their own data, and experts can exchange knowledge without intermediaries is clearly more fair and efficient than current systems.
In the long term, we will likely see coexistence and convergence between the protocol economy and the existing economy. Rather than complete replacement, traditional companies will gradually adopt principles of the protocol economy and shift toward more equitable business models. Leading companies may voluntarily recognize user data ownership and ensure transparent revenue distribution—gaining a competitive edge and driving change across their industries.
Ultimately, what the protocol economy envisions is the complete realization of individual economic sovereignty—a world where everyone can transform their knowledge, creations, data, and even daily activities into economic assets and receive fair compensation for them. Just as the internet democratized access to information, the protocol economy will democratize access to economic opportunity—marking a historic shift in the way value is created and shared.
This transformation has already begun, and it is becoming an unstoppable wave. A new economic system is unfolding before us—one in which individuals fully own their digital sovereignty, and every participant can create and share value on fair terms. The protocol economy is more than just a technological innovation—it is the driving force behind a more fair, transparent, and democratic digital society.
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