CPS is basically a catch-all term for talking about the integration of smart, internet-connected machines and human labor. Factory managers are not simply reimagining the assembly line, but actively creating a network of machines that not only can produce more with fewer errors, but can autonomously alter their production patterns in accordance with external inputs while still retaining a high degree of efficiency.

There’s also Asia, especially in Japan and South Korea. But it’s China that promsied to set the pace, announcing early on that it would invest 5 billion yuan ($800 million) in the IoT industry by 2015, according to a 2012 CNN report.

Research has shown that Moore’s law—which states that the capcity of microchips, bandwidth and computers doubles every 18 months, representing exponential growth—also applies to other technological developments. 3D printing, sensor technology, artificial intelligence, robotics, drones and nanotechnology are just a few examples of exponential growing technologies that are radically changing industrial processes, accelerating them and making them more flexible.

And in fact, we’ve seen this chart before near the end of the 18th century and the beginning of the first Industrial Revolution. During this time, known as the Great Divergence, the per capita income of Western Europe and parts of North America skyrocketed.

The Great Divergence wasn’t sparked by any single innovation. Instead, it was the result of many existing technologies reaching maturity at the same time and it would be that convergence that prompted the liftoff of what economist Eric Jones described as the European Miracle. By the 1800s, we would witness the rise of the factory system accompanied with ever-expanding rail and telegraph networks catalyzing an unprecedented movement in people, goods and ideas.

There are numerous parallels with the arrival of Industry 4.0, which, as the Deloitte report explains, similarly won’t be sparked by brand new innovations but the maturation of existing technologies and ecosystems:

Many of these technologies are not new and were, in fact, ‘invented’ some 20 or 30 years ago. However, the recent massive boost in computing power (Moore’s law) and the reduction in cost, along with miniaturisation, now make them suitable for industrial use.

That’s also why the Industry 4.0 group is most focused on establishing open standards and interoperability—essentially interchangeable parts for the digital and machine age—all of which is to leverage the rapid advance of factory automation underpinned by a bevy of smart networks.

Chart: Deloitte Industry 4.0

Of course, the glaring omission from the above chart is the smart network we champion most often here on Ripple Insights.

Though the Internet of Value admittedly still exists at a nascent stage, it’s only a matter of time before smart payments become a fundamental aspect of Industry 4.0. Every real-time interaction—between consumer and company, automated machine and supplier—will likely be underwritten by a corresponding payment.

As we’ve noted in the past, multinational corporations already make up over 90% of payments volume in the world. It’s understandable that as these companies enter Industry 4.0, they’ll want smart inventory not only of their goods and services but also their capital. After all, two primary benefits included by the Industry 4.0 working group’s 2013 paper are “flexibility” and “resource productivity and efficiency.” Eventually, the expectation will be that payments are able to play by the same rules.

“I see the Internet of Value as the underlying incentive structure for the Internet of Things,” Ryan continued. “But to get there, we need to be able to make payments in real-time, to be able to make both large dollar and micropayments economically. Looking to the future, I expect payments to not only become more integrated into our lives, but also passive as they become automated, interoperable and seamless.”

“New technology and payment infrastructure will enable the next industrial revolution. It will have a tremendous impact on productivity, efficiency and even risk management and oversight capabilities.”