Blockchain And The NWO

"Allison, can you explain what the internet is?" asked Katie Couric in this one-minute clip from a 1994 segment of the Today Show (1994: "Today Show": "What is the Internet, Anyway?"). Hilarious. Yet, the questions we ponder today about blockchain will seem no less hilarious in less than ten years. A new world order is upon us.  

Given the importance of the topic, future Member Monday sessions shall focus on the implications, the opportunities, and the promise of blockchain at three levels: 1. its role in a re-ordered post-pandemic world, a subject most aligned with our Member Monday philosophical tradition; 2. the associated financial opportunities -- whether they are deemed investment, speculation, or downright gambling -- rendered by this new frontier; and 3. some basic understanding of the underlying technical aspects, directed at that subset of participants whose interest includes its underlying technical infrastructure. 

Our physical lunch meetings in the library will be scheduled (not necessarily restricted to Mondays) to allow for the possible participation of various outside experts in the field. The challenge of blockchain generally, and crypto specifically, lies not so much in any shortage of supporting material but rather in the marshaling of such information in the most digestible way. Please note that I, as your host, am starting at a relatively basic level as are many of you. Other related subjects, such as finance, may also be introduced and interspersed as we move on.

In The Beginning: In the beginning, there was blockchain, a method introduced through a 1982 dissertation, later codified in 1991, as a system where documents could be time-stamped in a tamper-proof way. Then along came Satoshi Nakamoto (presumably a pseudonym) and his White Paper in 2008 with some major refinements including the application of blockchain to drive transactions without the need for any trusted party and as a way to stabilize the rate at which additional pieces of information (blocks) could be added. This design birthed a brand new parallel currency, a so-called cryptocurrency called Bitcoin. The White Paper referenced above is linked (below) but no need to read it (free lunch dessert to whoever can satisfactorily explain it to me) but is offered simply as the theoretical basis for the proposition that information can be both totally open and essentially immutable.

We previously addressed the Bitcoin phenomenon ( MM 11/6/20 Bitcoin And Value Illusion), taking note of the perceived value of these fungible tokens (i.e. they're all alike) as a currency arising out of the paradox of "manufactured scarcity" even as we acknowledged the underlying intrinsic value to be essentially zero (cf. fiat, gold?). That led to our discussion of blockchain's application to non-fungible tokens (NFTs) -- think of that in terms of title, or deeds, to digital assets -- as a way to establish failsafe ownership and transfer rights, leading the way to the eye-popping valuation of digital assets that we saw in the recent virtual crypto-art auction market ( MM 3/29/21 NFTs And The Metaverse ). These valuations may seem obscene to those (of us) who need to be yanked kicking and screaming out of our legacy mindset, but it's perhaps closer to the truth to say the advent of blockchain simply facilitates the age-old desire to possess that which others cannot ( Valuing Scarcity Credibility).

The past and present, however, are no match for the promise of this technology to upend the future, the focus of our upcoming blockchain series. One teaser comes with just a mere glimpse at blockchain's role in future disintermediation, a fancy term meaning the elimination of the middleman. We might first note the previous slow but steady encroachment of disintermediation in such areas as peer-to-peer lending, Uber, Airbnb, and Amazon. Blockchain, together with embedded so-called smart contracts, aims to catapult such disruptions to new heights in all areas involving identity, proof of ownership, and foolproof economic transactions in such areas as real estate, supply chains, healthcare, insurance, and even the automatic execution of a will. 

Targets for particular wholesale disruption include the securities and banking industries (How Blockchain Could Disrupt Banking). For a fascinating ride on the blockchain express, watch this articulate twenty-something (Jack Mallers) deliver an "aha" moment as this video rolls on (Lightning, Strike, and the Bitcoin Network). 

Even deeper down the rabbit hole is the prospect of the Decentralized Autonomous Organization (DAO), a complete paradigm shift in the notion of the economic organization and the nature of corporate governance itself. 

Katie Couric circa 2021, "Allison, can you explain what this whole blockchain thing is?"

(To access the previous Member Monday introductions, click TOC)