From disruptive to enabling
What we need to do to ensure that disruptive technologies — AI, blockchain, IoT — are implemented responsibly for the benefit of all
Iskren Krusteff
High-impact Entrepreneur, Crypto-Economics Expert, Chairman of Global Entrepreneurship Monitor Bulgaria

- This article was originally published as part of the 2018 edition of Bled Strategic Times, the official gazzette of the Bled Strategic Forum (BSF) international conference. You can access the full version of this and other BSF publications by visiting our official website.
With cyberspace, reducing time and space and bringing us closer faster, geographic settings matter less. Traditionally, geopolitics focus on political power in a geographic context. Now the cyberspace connectivity becomes a highly influential tool to exert power. In the future, competition over territories would give way to the competition over connectivity and global transactions not only the free flow of people, goods, services, and capital but most of its data a critical resource in an information society and Industry 4.0.
Whether connecting or trading through digital platforms, today, billions of people are transacting with each other at every moment. Exponential technological growth helps bringing people together, producing vast amounts of data for each transaction. Data accumulation and its access are what constitutes a power to control the market. Digital platforms already have generated a high degree of market power due to economies of scale. They function seamlessly, and costs are not apparent for consumers. However,they result in costs in parallel markets such as advertising. This gives tech monopolies competitive advantage when it comes to data accumulation enabling digital platforms and increases
their influence. Not apparent to the public, those technical decisions become very political and have strategic impact. Technology monopolies, instead of regulators are increasingly guiding and influencing what is credible or fake news, what are individual (data subject) rights, what is acceptable online. Consequently, they modify our rights, values, and social behaviour. Digital platforms exert extraordinary public influence. When they capitalize on the gathered data, they manage to influence healthcare (vaccines), politics, referendum and election outcomes.
Innovation-driven competitive ecosystems are fostering the development of disruptive general-purpose technology, such as AI and blockchain technology, propelled by access to data. AI-powered technologies and systems are already shaping our day-to-day lives and transforming our societies on a massive scale more than any other innovation. Any innovation is as good as its implementation and application. To benefit from innovation, we need to leverage it to create value and enable better value capture while preserving a social focus. Rapid advances in computer processing power and ever-growing volume of data generated from all IoT devices have resulted in increased data storage capabilities to the degree that big data is no longer just big it is extreme.
With a rising influx of data, we need an improved but an unconventional system to adapt to the new environment. Blockchain technology and protocols can add to the mix of data and provide more effective and secure transactions and data storage, which present many entrepreneurial opportunities. The AI ecosystem is developing rapidly globally. Funding for AI start-ups tripled between 2016 and 2017 alone, according to CrunchBase. AI adoption around the world is happening at an uneven pace UAE, China, Canada, USA are more advanced when it comes to developing and implementing AI strategy, than the EU. The development of AI depends heavily on a flexible regulatory framework, especially on data policy as data is an integral part of AI; and on investment in research and development. We see the majority of patent submission, scientific articles, data scientists coming from the US and China. It is no coincidence that they also have the largest data storage capabilities, while in the EU only a fraction of the global data is stored. The level of integration of AI in the EU is also amongst the lowest globally, due to lack of investment and availability of qualified workforce.
Machine learning as a subfield of artificial intelligence depends on the right skill sets amongst other factors. Here the education providers must step up to produce more and better data scientists, cryptographers and crypto-economists. Education must be problem-based, life-long learning with an emphasis on character-building. Such reform would help raise responsible and proactive citizens, capable of critically assessing new issues and swiftly responding to them. Technological advancement is so progressive it is hard to codify it. Software and legal code must match expectations; therefore, we need lawyers who are better educated and informed, to prevent AI algorithms evolving faster than they could be understood. To understand the software code and technology, one needs to understand their business applications.
The potential for enormous value creation is bringing it all together a combination of understanding the technology, macro-economy, and entrepreneurship as well as regulation. For smart contracts to do what we want them to do, lawyers, cryptographers, entrepreneurs need to talk, to come up with more terms for smart contracts, making incompliance impossible from the start. Frequently, implementation of innovation for general purpose technology requires testing on a small scale with regular upgrades. The alternative represents a risk seamless integration of various algorithms in many aspects of business and society, where malicious code takes over. Small communities allow testing with minimal resources, yet they provide us with valuable feedback. We can see how Dubai experiments with free zones and smartly disrupts an old governance system, diversifying economy, boosting growth while bootstrapping innovations and focusing on technology. The responsible leaders of tomorrow are people who can benefit from a singularity with AI, whereby accessing the super-digital intelligence must be available to all layers of society equally.
Let’s rethink old models and value chains, how business may look in the future, stretch our minds and take three radically disruptive technologies and mash them together, for example, on the transport vertical. Blockchain, AI, IoT in a shared economy, a ‘Bitcoin-powered Uber Self-driving cars with solar panels.’ What happens when all three interact and converge is, the Autonomous car. A car that produces its energy and pays its costs by giving people rides. A vehicle that is not run by the enterprise, but is an enterprise an autonomous financial entity with nonhuman ownership. It becomes a decentralized system, which provides profit-driven services to the society members and at the same time does not depend on a single individual, company or organization to have value a car run and managed by a set of trusted transactions on a blockchain. Then we have an autonomous system interacting, while blockchain is providing a record of decisions made. The proliferation of technologies such as autonomous cars will have significant social and economic impact.
What these technologies have in common and what makes them attractive is the reduction of costs by automating processes, decisions, functions, services and by integrating them further, lowering costs of networking and verification. Those systems are hard to control and monitor in the traditional way of centralized governance; here again we see how the decentralized nature of new technology is not in line with the existing regulatory frameworks. At this point, we must ask ourselves to what degree are traditional concepts and tools of statecraft usable in the digital age? Everybody is preparing for the future that is mirroring the past. Governments need competent experts with entrepreneurial mindsets to address future challenges. Could business step in, look beyond the short-term gain and contribute to global rules making? Responsible businesses should aim not to control and manipulate the technology advancement, but to shape the global standards in a way that all AI-based technology creations raise value for society equally. The ‘smart generation’ is worlds apart from the elderly; urban areas are decades apart from rural ones social and economic disparities are continually growing. We need to scale AI to serve humanity and to bridge the gaps that have emerged in society.
Blockchain platforms could be a way to connect AI with IoT in a secure way and bring benefits of shared network infrastructure without the market power and central intermediaries. Blockchain can facilitate access to capital that is concentrated geographically but also within specific social segments. People transacting are driven by incentives embedded within protocols; therefore it is essential to design smart contracts in the right way. This will present entrepreneurs with opportunities to easily scale ideas, regardless of where they are from. How do we do that?
- By encouraging cooperation between regulators, crypto economists, entrepreneurs;
- By facilitating the free circulation of non-personal data — modelled on establishing the 5th freedom of the EU. Blockchain solutions could be explored when it comes to digital data and privacy, as it can add an element of control people will know exactly how their data is being used, while at the same time data is not strictly localized and monopolized by governments and limited and AI regulation;
- By creating global alliances for security and AI regulation;
- By encouraging access to AI for entrepreneurs.
With these four steps, we can turn disruptive technology into an enabling one with a more significant positive impact for all.

