Emerging societal organization structures: Blockchain, bitcoin, E-residency and cryptocurrencies

We have been witnessing societal structures break down, a time of instability, where governmental systems, centralized financial markets, and trans-national corporations abuse trust, manipulate markets, hide information, and hoard vital resources. We have been witnessing the end of an era: the archaic era of the hero, the savior archetype, the centralized authority, and the collective transition into the era of the decentralized, horizontal, and distributed movement of no-leader. We are witnessing the conception phase of an emerging form of relating, trust, and organization built on the new peer-to-peer ledger system called blockchain.

What is Blockchain?

Blockchain is a distributed, decentralized ledger of transactions. What exactly does that mean? Distributed means that the entire blockchain is stored on every participating computer globally, there is no central or hub of authority that maintains it. Each transaction is checked by a multitude of users for accuracy, and when they reach consensus on the validity of the transaction, it is stored as an encrypted block. This block is attached to the block before it and transfers its summary information to the next block, creating a chain. Because of this organization, any of the stored information cannot be deleted or manipulated without destroying the whole chain of information. The chain cannot be deleted since it is distributed amongst hundreds of thousands of computers, with no central database or institution.

The blockchain exemplifies a new system of trust where we can engage in exchanges of value without a centralized verifying third party such as a bank, financial institution, vote counting center, or government. Instead, our transaction is watched by multitudes on the network who then verify the validity of our exchange.

The term ‘blockchain’ was first coined during the development of the cryptocurrency Bitcoin. This decentralized currency arose as a response to the 2008 economic crises by an unknown person/group called Satoshi Nakamoto. It took off immediately in the underground of internet black markets such as the Silk Road and with financial speculators and techno-anarchists. Bitcoin’s popularity inspired the creation of many other cryptocurrencies such as Monero, Litecoin, and Zcash. As novel as cryptocurrencies may seem, the idea of a decentralized currency is not new. Multiple papers and businesses have attempted to pitch this idea to society before, such as David Chaum’s electronic signatures idea in 1982, electronic payment system DigiCash in 1994, Nick Szabo’s bit gold in 1998, or Wei Deis’s paper on distributed electronic cash systems. However, prior to the 2008 market crash, the global audience didn’t seem ready for it, resulting in these previous attempts being ignored or forced into bankruptcy. Now the global dialogue is buzzing with the idea: as of Sept 2017 there are 1,110 cryptocurrencies registered, just like bitcoin, all built on top of the blockchain. Nine of those cryptocurrencies have a market capitalization over $1 billion US dollars, and 377 cryptocurrencies have a market value over 1 million, with a total value of the cryptocurrencies pushing $120 billion.

How blockchain is being used

Many analysts are likening the advent of blockchain technology to the birth of the internet. It is a break into the next stage of collective capability and we have yet to discover and apply its real potential. Just as most people in the 1980s and 90s were barely able to grasp how widely and deeply the internet would affect our lives, how blockchain is being used and applied now is probably only a fraction of its potential.

Cryptocurrencies

The primary use of blockchain technology has been the development of cryptocurrencies. A decentralized cryptocurrency has many benefits over fiat currencies, such as an evolved sense of trust, lower fees, quicker response, fraud prevention,  and international access.

In the 2015 book, The Age of Cryptocurrency, we are introduced to Ahmadi, a young Afghani woman who is a blogger for Film Annex, a US-based company. Glimpsing into the struggles of this working Afghani woman, we see that women in Afghanistan are not allowed to have bank accounts, and that any money a woman earns has to be siloed through a father’s or brother’s account. The owner of The Film Annex, having grown frustrated of financial situations like Ahmadi’s and international fees for sending money, decided to pay their bloggers in Bitcoin. This transformed the way Ahmadi was able to realize her agency, and now the money she earns she is able to spend freely and autonomously, empowering her to live a financially independent life and no longer just be an extension of the men in her family. Fereshteh Forough, an Afghan refugee and founder of Code to Inspire, an educational program for women in Afghanistan, comments:

“What social media did for communication, cryptocurrency promises to do for women’s autonomy. In a society that lacks banks, blockchain technology like Bitcoin offers a secure, transparent way to add value…Most importantly, it affords those marginalized by the brick-and-mortar finance system a chance to participate in the economy on their own terms.”

Health Cares systems, E-residency, and adaptive government policy:

Estonia, having declared internet access a human right in 2000, is establishing itself as one of the world’s most tech-savvy nations. Quickly adopting blockchain for its governmental purposes, Estonia now operates paperlessly, using the internet to sign needed documents, pay taxes, vote, and even give military orders. One of the easiest ways to see the benefit of the government’s adoption of this new technology is in the health of its residents. Estonians can easily access their health records securely, see their medical history, and view which doctors have accessed their records and when.

Another key feature that Estonia is exemplifying is E-residency which allows its residents access to services such as business creation, banking, taxation, and payment processing online. E-residency is a government issued form of digital identification issued to borderless global citizens. You can apply for an Estonian E-residency card or start a business in less than 15 minutes on e-resident.gov.ee. An E-Resident can manage finances and maintain a business anywhere in the world. This offers a huge opportunity to digital nomads, refugees and marginalized groups who may not have that access in their government or lack thereof.

Emerging Potential

On the horizon of blockchain technologies are systems-altering platforms. With the emergence and implementation of the decentralized blockchain, the technology is there to shift the powers that be into a more collective, shared, and distributed paradigm. Some projects that are noteworthy in their efforts to disrupt the current trajectory are:

Transparency in Organizations, Transnational Commitments and Carbon Pricing systems

Around 979 million dollars are spent in administration costs to track the global carbon credit system, which is continuously being manipulated, backpedaled, or cheated by governments and corporations. On a blockchain platform, the public ledger is transparent to ensure that commitments are being upheld; such as, carbon sequestrations tracking and payment. Seeing how CO2 emissions are the biggest threat to humanity’s future, and one of the fastest growing markets worth about 70 billion euros in 2015, it would be great to collectively prioritize sequestration. 

Global identification system, helping refugees maintain an identity

Biometric Management Identity System (BMIS) promises to be able to help support anyone anywhere, with access to their personal information. With a fingerprint or iris scan, one may access the blockchain of their identity, and with the individual’s permission, the requester can then enter a private off-chain site linked to the public blockchain; revealing who they are, education, job history, residence history, travel visas, etc. This could serve refugees and forced migrants when fleeing countries or when critical documents are confiscated, stolen, or lost. These vital papers must be accessible to cross international borders into safety, find international protection, or access banking and other services.

Blockchain technology has already affected our global populace in disruptive ways, and appears to be on a trajectory to continue to do so. Although I have mostly focused on the beneficial side of things, there are considerations which must be addressed seriously and responsibly.

Ethereum’s dilemma of integrity: Recently (2016) a DAO (decentralized autonomous organization) built a crowdsourcing campaign on Ethereum. Due to the fault of the program’s writers, they missed a key hole in the code, resulting in the hack and disappearance of millions of dollars from multiple funders. The dilemma resulting from this was foundational and led to the ‘hard fork’ in Ethereum. Should the creators of Ethereum break into their own system and return the money, or should the creators of Ethereum maintain their integrity and stay with the shared value of decentralized action? Ethereum returned the money to the dismay of many hardliners, and Ethereum split. Those hardliners who believe the ideology and integrity of a decentralized system should be maintained regardless are known as Ethereum Classics, and for those who acquiesce to returning stolen funds, regardless of if the fault was in insufficient coding, are known as Ethereum.

How flexible is the definition: A new company, Accenture, whose promise is a plan to edit blockchains: which is by definition, an oxymoron. The feature of a blockchain is that it can’t be edited, so if you edit it, then what makes it distinguishable from any other shared data space relying on the authority of a central monitor?

Pirates and boogey monsters:

There’s still the ‘criminal’ circuit: continual manipulation and shady ventures of ponzi and pyramid schemes, digital pirates, and institutional banks misrepresentations and manipulation of cryptocurrencies to maintain control as a central authority.

My personal opinion

Instilling a decentralized and distributed system of verification and exchange is a very freeing idea, especially to someone who believes strongly in horizontally organized social movements and non-hierarchical systems. I have the hope that by putting the power of consensus into the hands of many, that we could move forward more effectively and equitably. That on this platform a woman in the global south may have the same opportunities as myself in the global north. That we may erase nation-state borders and have freer movement as our global climate shifts, able to quickly respond to the changes and help one another easily, without a disempowering centralized organization leaving us as listless spectators to administrative redundancy. If this idea of ‘value’ becomes decentralized,—the value of money, the value of access to education, the value of right to an identity, the value of your voice or vote being counted,– could we transition our society to a more just world? I think blockchain has radical potential, and as an activist I am taking the responsibility to learn about it and see how, when, and where we can input the code for social justice.

C.K. Ami is an independent nomadic researcher currently living between Montreal & refugee spaces in France & abroad. She is passionate about forced migrant and environmental studies, meditation, social justice, human rights, CO2 drawdown, centering young women and LGBTQI2SPOC in our movements forward, and is a radical optimist. She appreciates clever wit, smiles, matcha mochi, and believes in taking responsibility of our own education. #explorarelmundosinfronteras 

 

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