Chapter 5: THE APOCALYPSE OF THE ESTABLISHMENT
We are heading for a brand new world — a world without middlemen. A decentralized world. So how many of the old-school institutions do you think are needed in this dawning economy? Let me tell you straight up. None. Not one single company will survive this. And no one is prepared. So buckle up — we’re in for a bumpy ride.
Following his new book on digital strategy How To Become A Digital Marketing Hero, Rufus Lidman is now translating all his knowledge to the most revolutionary field in the world. A field in desperate need of a digital strategy. In a series of articles, we will get an upclose view of this new mind-blowing market, seen through the eyes of a digital strategist.
>> Chapter 1: The Revolutionary Technology That Will Change Your Life
>> Chapter 2: The Birth Of The Future
>> Chapter 3: A Real Revolution In Practice
>> Chapter 4: A Metamorphosis You Are Not Prepared For
The blockchain revolution will reach far, far beyond transactions, and will have consequences on an entirely new level as well. As our old friend, entrepreneur and author Kevin Kelly points out in his latest book “The Inevitable”, we are in the middle of a hundred year-old trend (or maybe more appropriately, an oscillating process) of decentralization. Blockchain will constitute the final nail in the coffin.
So what does this mean, you might ask? To be perfectly blunt: the blockchain will change everything. Everything you’ve learned, everything you’re comfortable with. Finance, business models and their impact on the economy, all of it will change. And everything you think you know won’t matter anymore.
We have built our entire civilization on contracts, which was the first thing created after the formation of the written language itself. The simple fact that we now can generate secure contracts with millions of people who we may not know, but regardless will be able to trust through the immutability of the blockchain, will change everything.
In my home away from home, the United States, we have PayPal. In my native country Sweden, we have Swish. Both are cultural warning beacons of what’s to come. It’s a little bit like how NTT DoCoMo’s device shepherded the population of South Korea into going mobile far ahead of the rest of the world, alongside early adopters such as Sweden and Finland.
“Imagine block-transferring donations directly to a child born in poverty or a refugee of a war-torn country, just as easily as you would give cash-in-hand to a homeless person you see on the street.”
Imagine a PayPal or a Swish without a bank consortium or middleman behind it. Where the money doesn’t have to go through a centralized database to safeguard for fraud or misappropriation. Imagine the day when you, without a Visa, AmEx or any banks as an intermediary, can transfer your funds directly to your barber, your Über or your contractor.
But imagine also that you can block-transfer to anyone, wherever you want, without knowing the person or company in person. And still have a foolproof transaction and a sure-fire currency that your counterpart wants. Imagine block-transferring donations directly to a child born in poverty or a refugee of a war-torn country, just as easily as you would give cash-in-hand to a homeless person you see on the street.
Imagine block-transferring payment for your locally produced food, to the farmer down the road, for providing free-range eggs. Or to a farmer on the other side of the world, working the rice paddies where you got the contents of your pack of Uncle Ben’s.
Imagine taking out a microloan from an unknown source. Imagine putting money for your house directly to the seller and getting all the paperwork done and paying 100% securely through the blockchain. Imagine rewarding an ad that appeals to you, by paying via blockchain directly to the site, instead of through an ad agency. Imagine paying your insurance to a group of like-minded individuals who all offer their part and automatically reimburse according to the infallible blockchain secured terms and conditions agreement.
Imagine. And then consider which of the old traditional institutions and middlemen would be needed in a decentralized economy like that.
The Fall Of The Establishment
Let’s start off by saying this: Not one single company will survive this. It may sound provocative, but it’s a fact. This is not just the most probable outcome, but it will soon be the only one. Most of the largest companies in the world are decades old and based on centralized business models. These business models are the ancient and soon to be obsolete solution for parties that needed to work together, because they couldn’t trust each other on a larger scale. This centralization was in most cases designed to provide confidence. The need for confidence will be entirely replaced by the blockchain. In the new blockchained world, there just won’t be room for centralization anymore. The corporate structures that we are familiar with, will cease to exist, as there won’t be any need for them. The blockchain will simply change everything. And no one is prepared for this.
All the experience we have and the training we do, is based on the centralized model. Businessmen are neither ready or educated in how to deal with anything but. There is no template on how to conceptualize, design and run a business model in a decentralized economy. Within the financial sector alone, hundreds of billions of dollars will be ejected, making the industry faster, more efficient, more secure and with reduced risk. And hundreds of thousands of people, who today are engaged in trust management in centralized organisations, working with segments like banking, funds, insurance and investment, will disappear in favor of blockchain-based companies.
This is the sad story of the establishment. But there are plenty of positive anecdotes too. We are not just talking about the phenomenon of Bitcoin and other Altcoins, that are valid across the globe, but outside government control. The blockchain will also give a voice to the poor and the downtrodden, a neglected group of the financial market, where as many as 2 billion people don’t even have a bank account. Third world nations of today will also have the opportunity to play a different role in the future. Without the oppressive legacy of a centralized economy, it will be more quick and easy to build new economies. Economies that are free of centralization and where each and everyone may become an entrepreneur in their own right.
“Traditional distribution of wealth and socioeconomic limitations will be eliminated.”
Developed first world nations like the United States or members of the EU will of course see considerable financial gains in a decentralized and blockchain distributed world economy. But it is even more likely that developing countries will be given a chance to elevate their position globally. Traditional distribution of wealth and socioeconomic limitations will be eliminated, which will create a huge impact, not only financially, but politically and socially as well.
The Birth Of A Brave New World
In the end, this zero sum game of the equalization struggle between countries and regions, nations and professionals, the fight for limited resources, isn’t just unnecessary, but insipid. Utilizing new technology only to repair obsolete solutions to the eternal problems is a waste of time. The way to go is to truly innovate and find entirely new ways, new applications for new solutions. That’s when you can create real change.
When I turn to the present, the reality as we see it now, with its pyramid structure of diminishing top and broadly distributed bottom, I keep the projected fall of the establishment fresh in mind as an inevitable fact and say: You ain’t seen nothing yet.
As we now watch how all the middlemen and intermediaries will be eliminated by the security of the blockchain, let’s look at the big picture — who do you think is the biggest middleman of them all? The one connected to the most substantial contract we have, the one that takes up the largest chunk of our economy, the one who then distributes it through transactions to all of us and to others. So you figured out who I’m talking about? Yeah exactly, it’s the one represented by a flag. So how much do you think this gigantic middleman will be needed in a blockchain future?
Taking it some steps further, this implicitly means changes that I think most people aren’t even capable of imagining. Just as the past few decades have led to a dominion of global corporations, so too will the next decade be centered on a whole new group of nations. Global, fluid nations, with no use for old-fashioned analogue borders and checkpoints. With no need for divisions of culture, finance or business. But instead nations acting like tribes, that are connected through the ether, through the blockchain, rather than archaic concepts of nationalism. Instead, it will be about what nation you choose to adhere to, where you have the pick of the litter of currency, insurance, education and healthcare
The global village is finally here.