Blockchain Revolution — Don Tapscott, Alex Tapscott

You’ve probably heard of the blockchain. And like me, you probably have some vague idea of what it is.

Well, now I know.

Because this book, although kind of repetitive after a while, explains so many great uses in terms that don’t seem, as is often not the case, too complicated.

Here are some highlights. Starting with this fairly simple explanation of what the blockchain is

Every ten minutes, like the heartbeat of the bitcoin network, all the transactions conducted are verified, cleared, and stored in a block which is linked to the preceding block, thereby creating a chain. Each block must refer to the preceding block to be valid. This structure permanently time-stamps and stores exchanges of value, preventing anyone from altering the ledger. If you wanted to steal a bitcoin, you’d have to rewrite the coin’s entire history on the blockchain in broad daylight. That’s practically impossible. So the blockchain is a distributed ledger representing a network consensus of every transaction that has ever occurred. Like the World Wide Web of information, it’s the World Wide Ledger of value—a distributed ledger that everyone can download and run on their personal computer.

This terrifying vision of the future:

“If an object, whether it be a sensor on a communications tower, a light bulb, or a heart monitor, is not trusted to perform well or pay for services it will be rejected by the other objects automatically.”

An awful lot of things about the blockchain seem hilariously dystopian:

In peer-to-peer networks, the consensus algorithm divvies up the right to update the status of the network, that is, to vote on the truth.

This is a really big problem:

A day laborer in Los Angeles cashes his paycheck at a money mart for a 4 percent fee, and then walks his fistful of dollars over to a convenience store to wire it home to his family in Guatemala, where he gets dinged again on flat fees, exchange rates, and other hidden costs. Once his family has divvied up the sum among its many members, nobody has enough to open a bank account or get credit. They are among the 2.2 billion people who live on less than two dollars a day.

And given my interest in anarchism, this is fascinating:

 

Yochai Benkler told us, “What’s exciting to me about blockchain technology is that it can enable people to function together with the persistence and stability of an organization, but without the hierarchy.”

But I also find this incredibly promising:

Fifteen percent of the population in OECD countries has no relationship with a financial institution, with countries like Mexico having 73 percent of the population unbanked. In the United States, 15 percent over fifteen years of age, or 37 million Americans, are unbanked.