Digital predictions from 1994 to the inevitable disruption from Blockchain today

The central hypothesis of this 14 page explanation and set of predictions in the UK's Daily Telegraph in 1994 was that the synergies between the three emerging technologies (satellite, fibre optics and silicone chips) would bring about a digital age of information on demand, anywhere, any time. The impact on communications, education, music and business were also explored and even the consequences upon our democracy challenged.  

This was the first comprehensive in-depth examination of the Internet, a thing that many people at the time did not believe existed let alone had used themselves, including most of our politicians and heads of industry. The reaction by government, business and the industries under-pinning the Internet was mixed and to some degree indignant or dismissive. As a consequence I found myself catapulted from obscurity to prime time TV to be challenged on every aspect and even flown out first class to the USA to meet with Bill Gates who tried to convince me that the Internet could not work. At the time he was contemplating building his own private Internet along with an impressive array of satellites. He even hinted at becoming the world’s first taxation authority and during our interviews, struggled to see the value of a model that was dependent upon collaboration or trusted relationships. 

The article is well worth the read if only to gauge how long it takes to get anything new adopted without people seeing exactly what value is in it for them.

In 2001 I approached the author and investigative journalist John May again, but this time with a far more disruptive and disturbing prediction. This hypothesis was that the next digital revolution would not be technology oriented but based on deconstructed legal instruments embedded in the very fabric of the internet. Again, John did not understand the technology or believe my prediction and this time he requested that I also take into account the impact of global warming into the endpoint equation along with the digital disruption tipping points that I kept banging on about re Smart City’s.

This time I suggested there would be blood; not just a second version of the Dot.Com speculators feeding frenzy. This was a totally new vision of a world where any person or collective group could transact in real time and trade everything, anywhere. It would come about in such a short time frame that traditional intermediaries, institutions or multinational trading agreements would not be able to react quickly enough to stay intact or, in many cases, to survive at all.

As this disruption reaches its tipping points it will exacerbate the drivers that already exist for professional, religious and common interest groups to muster their collective economic, social and political power to save money, feel safe, protect and exercise power. As with geographic regions or Smart Cities, they all need to consolidate their collective power just to survive and feel safe in a digital global economy. 

The question remains as to which groups have the right attributes to excel, which include cohesion, purpose, collaboration, organisation, trust and, most importantly, something that they regard as being universally sacred, that can bind them together as a force to equal the supply chains. Interestingly, the definition of sacred has to be something other than money for it to create sufficient cohesion. Once this is defined then it’s possible to understand which groups will have sufficient common ground to bind together to create strong alliances that, at some point, would reach a tipping point of equalling the collective power of the supply chains, which will initially be existing corporations but at some stage they too will be challenged by the producers who will use the same aggregation models to usurp them. 

A hybrid of this model would be, for example, electricity generation where homes, business or micro-networks are producers as well as the users of energy, which will amplify the disruption and accelerate the shift to everything becoming commoditized. 

Having researched this subject at length the conclusion was that those who acquired the most consent of the broadest nature to act on behalf of the highest number of members for the greatest range of services, win.

The three deconstructed legal instruments I identified that could bring this about was the promissory note, legal consent (towards common law power of attorney) and the notion of a person and/or their credentials being considered bona fide. I also identified the need for the equivalent of digital issuing, verification and compliance authorities that could, in most cases, be appointed by the crowd or members itself. The benchmark for this to work was that a given interconnected environment or virtual group could trade and coexist in a legal state of non-repudiation. Or more simply put, such as with, say, a stockbroker today, a person cannot challenge or repudiate the agreed rules or accepted protocols themselves, but they could challenge the adherence to the agreed governance framework.

Then came along Bitcoin which, on first sight ,did not excite me as I had already seen first-hand what the banking sector could do to innovative alternatives that had less risk or cost with the FSTC e-check initiative. This was driven by Marty Tenenbaum at CommerceNet in conjunction with the US Financial Services Transition Consortia and their membership of major banks and Federal Government Treasury. The ingenuity of e-check was that it was regarded as a legal instrument (promissory note) with a XML folder that could include all the associated certified documents to enable automated verification and reconciliation with all the interconnected business systems including the banking exchange systems. More importantly, because it looked like a check, smelt like a check and even behaved like one, it was able to assume all of the common law associated with bank checks to mitigate risk, liability and cost of adoption. 

All good so far, especially as the testing was carried out by the department of defence and US Treasury and even here in Australian where I ran a trial so that the RBA and other banks could observe that it was possible to replace the Australian banking exchange. The problem for the banks was the cost, or the lack of to be precise. Only costing a fraction of a cent per transaction the business managers went berserk arguing that the banks would lose licence fees and the ability to extort a percentage of the transaction amount on top of the fee per transaction. So despite the years of planning and cost the initiative was killed on the spot. 

I had also played with digital wallets back in the 1990s so was sceptical that the likes of Bitcoin could or would replace the banking sector especially as they, in turn, would use block-chain to strengthen their iron like grip on the market. Interesting to see that some governments are now looking at block chain to create ways for its own citizens to exchange and save money without the need for banks. Most families I knew as a kid did not have a bank account as we all used a public utility savings account operated by the Post Office for free and it was only when payroll switched from cash to check were we forced to open a bank account.

Then came Ethereum to unleash the potential of embedding the full array of legal instruments within a block-chain global computer with the promise of transactions within a state of non-repudiation. 

But for me it took the advent of the ConsenSys fraternity and its ever-expanding capability and solution sets to convince my clients that the day of reckoning had eventually arrived. Most exciting of all, I could finally embed my own digital value creation, capture and realisation methodologies within a trusted distributed governance framework. 

I have spent the last ten years working through what could be possible if all the legal instruments in use today could be deconstructed, converted into block chain code and presented as a smorgasbord menu for architecting governance frameworks for digital eco systems. I quickly saw that if you then replicate issuing, verification and compliance authorities within the same framework then the notion of operating in a state of non-repudiation is finally achievable, affordable and highly desirable.

By working backwards from the wicked problems, operational pain and considerable digital disruption that governments, corporates, business and professionals are experiencing, it’s now possible determine how these ConsenSys solution sets can generate sufficient verifiable value to neutralize the operational pain and fuel the aspirational journey to where they need to be.

The most profound aspect of the ConsenSys culture and perspective for me is the notion of contributing to the common good is not just an afterthought but is woven into the very fabric of the solution sets and even the ethos of the code.

On a final note a few people have asked when the next article is coming out covering this new vision and I am pleased to say that I spoke with John and he has agreed to co-write the next story once I get some sponsorship to cover his time. which should be occurring early next year. How times have changed where the print unions would not allow my name to be mentioned as a writer as I did not have a journalist union card and the advert on the last page was for Encyclopaedia Britannica !!

stephenalexander.com.au