Web3 for building and preserving generational wealth

Introduction

One of the best legacies people leave for the next generation is wealth. The history of human society shows that some few fortunate people have inherited massive wealth from parents that amassed them. Generational wealth is a subject on the mind of every living person. This is because aside from helping the next generation live a better life, leaving wealth behind is an amazing way to be remembered when one is gone.

The question is how do one build generational wealth in this time of blockchain technology and web3. Current traditional ways to grow and store generational wealth includes massive investments in real estate. People invest in properties in various cities and leave it out to grow in value over a very long time. When they are no longer alive, the next generation inherits them.

Other ways they leave generational wealth includes building large corporations that are wealthy. These companies often grow to become multinationals. They employ thousands of staff and have massive annual turnovers. The companies are often left as inheritances to generations to come.

While these traditional methods of growing and leaving wealth are well established, the era of blockchain technology and web3 presents opportunities to build and grow wealth in different ways. Web3 presents easier and more lasting features to build wealth which would last for generations to come. This discussion looks at the possibilities for building generational wealth through blockchain technology.

Fractional ownership through tokenization

Web3 comes with many features that enables individuals to invest in projects of high value over a long period of time. Fractional ownership of assets is made possible in web3 through tokenization. Before web3, only wealthy individuals and companies could afford to invest in high-value assets such as those in real estate. But now, all of that has changed through tokenization.

Imagine the possibility of an average income earner to invest in a spiraling real estate worth many billions of dollars. This would not be possible for the average person on the street. But today, the representation of real world assets in digital value makes it possible for individuals to access such high-end investment opportunities.

Through tokenization, that massive real estate for example, would be split into token units on a web3 platform and investment would be open to everyone. Now that is where fractional ownership of assets becomes a real possibility. Instead of having just one wealthy person investing in a huge property, tokenization breaks it down into smaller units of tokens which everyone would be allowed to buy.

Relating this to building generational wealth, users have the opportunity to invest in valuable projects that could last years to come. A high-value real estate project is a great example of investment that could continue to bring returns on investment over a long period of time. A user might obtain fractional ownership of such property and then allow this investment to continue turning in returns for generations to come. Even when the original investor is no longer there, surviving generations would continue to earn the rewards of such investment.

Defi - Earning interest for generations to come

Defi is another aspect of web3 that is booming with opportunities to build generational wealth. It presents users with opportunities to invest in projects that could be left for years and wealth grows even for unborn generations. consider the following:

• Staking: In this type of defi investment, users lock up funds and continue to earn interest based on the terms of a smart contract. As long as the funds remains staked, the rewards keep on coming endlessly. Imagine a user that has plans of building generational wealth. What they need to do is to raise a reasonable amount of funds and stake them for a very long term.

• Liquidity pools: This is another opportunity in def that could be used to build generational wealth. Liquidity pools are very important for the smooth running of any defi project. Users can provide liquidity for trading pairs of tokens in a defi platform. Users that provide liquidity earn from the interests generated from the trades. Again just like staking, users could continue to provide liquidity for as long as they have the funds. In this way, they can continue earning from the liquidity provided for years to come.

• Defi loans: Defi loans is another opportunity to access funds. Such funds could be invested in other businesses and over time, profit made in such businesses could be used to grow wealth in other means. As the money made from loans for business turns out returns, the user could reinvest them in other areas of defi that fosters opportunities to build generational wealth.
  

Securing wealth through blockchain records

Another way defi through blockchain technology offers a way to build generational wealth is in immutable storage. There have been many instances of people that built generational wealth only for the next of kin to loose them to massive fraud schemes. As such, the wealth built for the unborn generation are lost to fraudsters.

There are other times when disputes as to how property is to be shared leaves those property wasting away as the legal disputes drag on. Such disputes might linger for many years and by the time such dispute is over, the assets might have either lost value or the intended owners loose them entirely to such legal battles.

Defi, specifically blockchain technology has a way to ensure that accurate records of property ownership are kept through its immutable storage. Instead of keeping documents in places where it could stolen or lost to unauthorized persons, such records could be stored on the blockchain.

The blockchain is tamper-proof. Records of property ownership placed on the blockchain can never be deleted, changed or manipulated in any way. Only the original owners that have the keys to the documents would have access to them. The cryptographic hash and encryption techniques make it very difficult for any unauthorized persons to tamper with them.

Immutable storage of the blockchain could help build generational wealth. But most important, it is important to be able to preserve such wealth. This way, only the legal and actual next of kin would be able to inherit any generational wealth left behind by ones parents of other close family members.

Conclusion

Lots of people are enjoying wealth left for them by an earlier generation. There are still others that are building wealth with the intent to leave them for surviving generations. Web3 and Defi is full of opportunities to build and preserve wealth for future generations. Staking, liquidity pools, yield farms, loans and other opportunities allow participants to earn interests over a long period of time.

Preserving wealth is important too. Thus, the immutability of blockchains make it possible to save documents and records of investment in such a way that no one would be able to tamper them.