Rebuilding society’s rules into the internet
Software engineers are working all over the world to digitally re-encode how society’s work. This concept is exploding right now. The recent invention of the blockchain has been the catalyst.
A blockchain is a distributed data structure that uses some method of consensus to track and timestamp information. Bitcoin made this digital structure famous and uses it to track who has bitcoins. The way all this is achieved is fascinating. I wrote a little more about Bitcoin in 2011 and of course the internet is full of other articles.
The most important thing to remember about Bitcoin is that it’s an implementation of an idea. It’s nothing like gold. It’s more like the first unix kernel. It will evolve and improve or new and better things will come along.
Immediately after the introduction of the blockchain, people realized it’s importance beyond payment. Bitcoin’s introduction included some of these concepts but they were never fully baked.
New blockchain features and experiments are now rolling out in the Ethereum project. Rather then focus on payments, Ethereum will try to revolutionize how human organizations are run. If Bitcoin made it efficient to move value online, Ethereum will make it efficient to organize society online.
Ethereum became the 6th highest crowd funded project in 2014 by preselling $18 million worth of Ether. More importantly, by eating it’s own dog food the first major organization run using Ethereum smart contract’s reached #1 by raising over $130 million.
TheDao lives at 0xBB9bc244D798123fDe783fCc1C72d3Bb8C189413. By clicking that link you can watch transactions or interactions with the organization. You can see people funding it and receiving voting rights. You can see proposals to fund new projects and people voting. Dividends can be paid to owners. Voting rights can be sold. The organization could be split due to disagreement. Here is the whitepaper for more detail.
Matt Levine at Bloomberg has written an article about TheDao and gives an overview but misses the point. He starts,
“One of the great joys of our modern age, with its rapid advances in financial technology, is examining the latest innovation to try to figure out what centuries-old idea has been dressed up in cryptographical mystification
Digitally encoding our contracts isn’t necessarily about inventing a new kind of human organization, it’s about making the one we have more efficient and automatic. The internet is not an invention of a new language, it’s a way to transmit it more efficiently across the world.
Will this all really work? Could Ethereum be used to organize people and society? The answer to this is the same as questions like, will bitcoin work? The answer is yes, it’s working right now and it could end in disaster at anytime.
Are there problems with the technology? Yes. Will it be dramatic and exciting? Yes. Will there be scams and feuds? Yes. Will Ethereum succeed as a new way of organizing humans? Yes or until something new and better comes along.
