The “War” Between Crypto & BigTech: a Response to Lou Kerner

CleanApp
CleanApp
Sep 12, 2018 · 7 min read

The Coming Epic Battle Between Crypto & FAMGA (aka Facebook, Apple, Microsoft, Google, & Amazon) by Lou Kerner is a great bit of analysis.

We wanted to offer a few immediate thoughts in response:

Crypto(macro)nomics

The main advantage that crypto has over FAMGA is its ability to print money (FAMGA has the same power but can’t use it fully as it would undermine/dilute/inflate the juicy USD revenue/profit streams that shareholders demand).

Crypto’s Biggest Problems

Please add “Law” to the list of the crypto community’s biggest problems (“As the community addresses its biggest problems (e.g. governance, token economics, [law]….).”

Here’s what we mean instead, and why Law is both crypto’s biggest problem and its biggest (though fleeting) opportunity.

The Central Battlefield is Hardware

Brock Pierce (Bitcoin Foundation) kicking it with friends in Puerto Rico. Try to spot the easiest points of failure in the picture. Hint: follow the text, and white arrow and the yellow box, which are our fair use parody/educational overlays on a beautiful photo by José Jiménez-Tirado. The photo is from a New York Times article by Nellie Bowles, Making a Crypto Utopia in Puerto Rico.

Tech’s Biggest Opportunities Are Material, Not Digital

Any of the FAMGA behemoths *can* create a crypto instrument that would absolutely eclipse all existing crypto instruments today, even when taken together. It’s not that hard. It just means launching 3 to 5 material hyperutility applications that essentially peg a given AppleCoin or FaceToke to commodities or services — and ideally to both simultaneously.

The process that makes it easy to “earn crypto” — as opposed to just easily spend crypto — will be a runaway success upon launch (especially because that process will equitably reward early adopters with higher incentives that taper off over time).

Please note, this is not a matter of if, but a matter of who and when.

Crypto-backed lending economy? Coming right up!

Crucially, the (1) socially useful (2) commodity + service activity that’s done to (3) earn the given crypto instrument must be of a (4) material and, simultaneously, (5) close to inexhaustible nature.

Satisfying each of these criteria (especially the last two) seems impossible, akin to the “magic” of “Zero Knowledge Proof” in Kerner’s article. But it’s not magic.

The bicycles above are finite material resources, but there are asymptotically infinite, aka “extremely large,” numbers of actual and potential human transactional relationships with those finite bicycles.

But that’s just the tip of the iceberg.

There are also billions of “bicycle”-like things whose utility can be radically reimagined and amplified. Let’s call these “bicycle-like things” … say … “Resources” — like cardboard boxes, scrap metal, etc.

Do we really need “crypto” to unlock the real value of cardboard? Yes, because it’s not cardboard data that needs to be securely tracked and transactionally-enabled/market-ized; rather, what’s being bought and sold on new material hyperutility crypto markets is data on individuals’/firms’ relationships with commodities, including personalized geolocation, usage, valuation, and transactional history data.

Blockchain/DLT structures like IOTA Foundation’s Tangle permit the introduction of entirely new nano-financial incentive structures for allocating Resources (& human labor in relation to Resources) more efficiently.

We’ve outlined the mechanics & economics of processes like this, and have shared widely and proudly. Everyone who has worked through the argument gets the thrill of a Eureka! moment, and we know you will too.

There isn’t a single articulated counter-argument to this, let alone a viable one. Do you think you can crack our logic? We dare you, and we offer bounties in return.

The War Isn’t Coming; It’s Here

As you can see, we enjoy the analysis in Kerner’s piece, but we reject the war binary.

We get that Crypto v. FAMGA is a great heuristic and click-bait, but as Kerner himself points out, it’s not a binary choice. Many FAMGA crews are developing crypto offerings; many crypto crews (e.g., ETH) are actively integrating with BigTech.

Pitting Crypto v. BigTech might actually occlude the real conflicts unraveling all around us.

We’ve explained why the war is unnecessary, and the easy steps that crypto developers can take to avoid costly battles — which in the end just stifle innovation.

Instead of Warring, Everyone Can Flourish

We’re urging both FAMGA (what we call BigTech, including Alibaba and giant incumbents like IBM, which should never be counted out) and crypto to wake up to the potential of material hyperutility processes that quickly move us towards smarter overall resource use (far less waste, fewer short term and long-term costs, far less damage to our environment & well-being).

Can “crypto” put this bottle back together again?

In our view, BigTech & Crypto can not only coexist; they can complement one another and flourish together, along with the rest of us.

The key is offering solutions that give low cost material hyperutility so that everybody is better off, and nobody is worse off (at any scaled implementation of the given process). Again, it’s not that hard to imagine these processes, or to implement them. They just require us to rethink utility and network security.

A CleanApp-enabled society so clearly Pareto dominates a CleanApp-less society, that implementation becomes a question of when, not if. We know we’ll get the security frameworks necessary to implement robust CleanApp processes — “Alexa, CleanApp this dumpsite please.”

We think crypto & BigTech would be far better served by realizing the need for these data security frameworks sooner, rather than later.

To Unleash Maximum Utility, Fix Hardware

Please note even when FAMGA launches its CleanApps and crypto launches its “Omni-killers,” tech will still have a major unresolved trust problem: hardware.

Photo by José Jiménez-Tirado (New York Times) (fair use text overlay added)

Right now, hardware flaws are patched with software. Rapid product cycles mean that, as between any given permutation of hardware and software that you might be running, there’s a good chance your system is insecure.

As our mobile computers become our primary crypto hyperutility tools, it’s easy to see how patchwork, fragmented, and proprietary security regimes will continue to be exploited by private and state actors as economic and governance tools.

As Kerner points out, reputation is one counter-measure that we enjoy as users, but an individual (no matter how prominent or respected) will rarely pose a threat to a large network (cf: Snowden).

Cyber Global Governance

If we look at today’s cyber-economy/crypto-economy landscape, we see that it mirrors geopolitical trends.

On the one hand, globalization promotes economic decentralization. On the other hand, legitimate or exaggerrated external threats can be used to justify re-centralization and lead to the emergence of largely self-contained economic networks.

The question is NOT even whether FAGMA/Crypto leaders have the audacity to pursue maximum beneficial relationships and outcomes. They are already doing the best they can under their given constraints.

What World Do WE Want?

In the end, it boils down to OUR vision of the New Internet. Just like with the ongoing fight over Net Neutrality, the big question for US is this:

In other words, do we want a flourishing global society, or artificially flourishing micro-tribal enclave societies (ones that externalize the true costs of their “flourishing” onto others)?

This is where YOUR answer makes a real difference.


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The purpose of ALTCOIN MAGAZINE is to educate the world on crypto and to bring it to the hands and the minds of the masses. This article was written and composed by CleanApp on ALTCOIN MAGAZINE.

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Small NGO with a big patent urging BigTech & Crypto to enable trash/hazard reporting & open source data. "The Wi-Fi & Bluetooth of TrashTech" - cleanapp.io.

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