Fairy Tales Re-Imagined in a Blockchain World
Every time I attend a session on blockchain, I find people trying to explain how blockchain works. They begin by talking about cryptography, blocks, hashes, chains, distributed ledgers, proof of work, etc. Some people “get it” and most people don’t. They just want to know what it means to them and how it might change the systems we use every day. By the time speakers get to the application of blockchain, most people in the audience are exhausted by the effort of understanding how it works.
So, here is an article on blockchain that completely skips over HOW blockchain works and gets to the part about how blockchain has the potential to change the tech world. And, just to make it fun, let’s talk about this potential in the context of the childhood fairy tales we all know and love.
The Queen asks her mirror, “Magic mirror on the wall, who is the fairest one of all?” On learning it’s Snow White, she sets out to rid herself of her rival. Disguising herself as an old hag, she gives Snow White a poisoned apple which sends her into a deathly sleep which is only resolved, many pages later, with help from a prince.
In our fairytale blockchain world, Snow White accepts the apple and checks the blockchain records associated with the apple. The diary entries — immutable and accumulated throughout the life of the apple — show that it comes from a well-known orchard, was picked three days ago by Evening Shift Crew #4, transported by Farmer Mark to the Organic Apple store, where it was sold to Maid #6 from the Castle kitchen and sent up in a fruit tray the previous night to the Queen’s chambers.
In this fairyland, blockchain records centered around people are protected with limited access for privacy; but records for food safety are considered a public good to society and readily accessible. Just like the quaint little individual fruit stickers we struggle to peel off in our own reality!
Wait… the Queen’s chambers… that’s the Evil Queen! How did this old hag get an apple from the Evil Queen? Snow White is mighty suspicious and thanks the old woman for the apple, but carefully uses a gloved hand to toss it into the bushes. She never falls into a deathly sleep, and no princely intervention is required to wake her.
Blockchain has the potential to revolutionize all of our supply chains. From machine parts to food safety, we could soon be able to look up the provenance and history of an item, ensuring it’s genuine, and tracing its journey along the supply chain. Secure entries — immutable and created throughout the life of an object — allow for secure sourcing, reduced instances of fraud and forgeries, and greater safety.
Walmart has already begun trials of blockchain with food safety in mind. So the reality is not too far from our fictional tale!
Three Little Pigs
Three little pigs each create three little houses — one of straw, one of wood, and one of bricks. A wolf comes by and threatens, “I’ll huff and I’ll puff and I’ll blow your house down.” Each piggy in turn runs from the straw to the wood and eventually to the brick house to escape. The wolf destroys the more fragile houses, but is finally thwarted by the brick house.
In our fairytale blockchain world, it was trivial for the wolf to find the pigs as all property transfers, title records, permits and government records are stored in a government sponsored public blockchain. The records are transparent, available to all, and immutable. Nobody can fraudulently steal your house or car, and title insurance is unnecessary. Property transfers are completed in a secure and distributed system without having to wait hours to get permits or go to register transactions at government offices. The wolf was easily able to search the public property blockchain and find the addresses for the pigs. He was also able to infer from permit records that two of their three houses would be vulnerable to his huffing and puffing. Good odds for a good snack!
Today, many of our states have publicly available records, including property ownership and history. Blockchain could give us more control over our own data, as well as allow it to work for us rather than rest in obscure silos.
Wait…don’t fairy tales have happy endings? Well, in this case, automated contracts in blockchain allowed the piggies to immediately collect their home insurance payments and rebuild their houses after the wolf huffed and puffed them down. This time with extra reinforcement against wind damage. We hope they were also more careful about allowing their blockchain records to be accessible by hungry predators!
Potentially, smart contracts in blockchain could allow for the rules of a contract to be written right into the blockchain itself. “The insurance company agrees to pay the little piggie $100 if the housing structure is completely destroyed once confirmed by a reliable source.” As soon as the news of the destroyed house is published by the local newspaper, written into the title records, etc., $100 would be transferred to the little piggie. No forms to fill out, no additional conversations, no delay.
While these contracts would have to be written carefully and digitally, once done, the contractual clauses could be self-executing, self-enforcing and irreversible with a very low transaction cost.
Sweden is currently experimenting with putting land registries on a blockchain. Another fiction from our tale, getting closer to reality.
Little Red Riding Hood
The Big Bad Wolf knocks on Grandma’s door pretending to be Little Red Riding Hood and she lets him in, only to be swallowed in a single mouthful! When Little Red Riding Hood gets to Grandma’s house, she sees Grandma all covered up in her bedsheets. Through a series of carefully crafted statements (“Oh Grandma, what big hands you have! What big teeth you have!”) she figures out that the Big Bad Wolf is impersonating Grandma! But not before being swallowed herself. Thankfully, a fortuitously timed hunter at the window vanquishes the Big Bad Wolf and both Grandma and Little Red Riding Hood jump out of his belly shaken but unharmed.
In our fairytale world, when the Big Bad Wolf knocks on Grandma’s door pretending to be Little Red Riding Hood, she does not open the door! The door is a smart door that opens automatically when it detects Little Red Riding Hood’s smart watch. Little Red’s smartwatch hasn’t posted any blockchain location transactions near the door! Grandma is mighty suspicious when the Big Bad Wolf knocks and the smart door announces that an unidentified and unauthorized visitor is attempting to gain entry! The door updates the shared blockchain with the suspicious event, all the other smart doors in the community are alerted, and the Big Bad Wolf is thwarted.
If the Big Bad Wolf does get in and swallows Grandma in a single mouthful, Little Red Riding Hood can still be saved from a similar fate. She’ll get notified long before she reaches the house that Grandma’s Life Alert pendant has not been writing any wellness statistics to the blockchain for the last ten minutes! It’s been correlated with Grandma’s fitness tracker entries that show she hasn’t taken a single step, and her heart rate has hit a new low. It’s also been correlated with the data from her tea kettle reporting that it hasn’t made her 3pm tea, and her pantry door reporting that she hasn’t opened it to grab her tea cookies.
Not only can people interact with the blockchain, so can their household objects. Distributed Internet of Things (IoT) enabled devices and a distributed ledger (blockchain) can work together to track interactions. The IoT objects send messages to us, talk to each other, and make everyday life easier through an interconnected and shared blockchain. The fridge re-orders milk, the stove begins cooking dinner as soon as we leave the office, and online retailers ship out birthday gifts before we even order them. All interacting, coordinating, and triggering over a shared distributed blockchain infrastructure
Grandma’s personal physician and 911 responders monitoring patterns in the blockchain entries are similarly alarmed. Little Red Riding Hood approaches the door with two paramedics and is better prepared to deal with a wolf surprise!
On the local TV stations that night, you could hear Little Red, “My gramma may be a privacy nut who likes to live in the woods,’’ she said, “but even she knows carefully sharing her data with other systems is mighty smart!”
A number of countries, such as Singapore, have already launched digital identities for their citizens, laying the foundation for them to be leveraged in a blockchain. Electronics company LG already has a fridge running a full version of Windows 10 on one door. And Amazon is already rolling out smart cloud-based buttons to help with reordering common household supplies. It’s only a matter of time before they come together to protect us from our own big bad wolves!
From a Fairy Tale World to the Real World
These fairy tales retold for a blockchain world give us a better feel for how blockchain could be applicable in our lives, rather than just how the blockchain works.
In our fairy tale world, blockchain is a shared indestructible diary that all our characters can use. Each page in the diary is securely attached to all the pages before it in an unbreakable way. Nobody can modify a page once it’s written. Characters can write about deals they’ve struck, things they’ve created or consumed, or bets that they’ve made. Often, the story gets simpler, clearer, fairer, and less traumatic!
What stories will we tell our grandkids someday? Will they start with, “A long, long time ago, before the invention of blockchain…”
These opinions are those of the author. Unless noted otherwise in this post, Capital One is not affiliated with, nor is it endorsed by any of the companies mentioned. All trademarks and other intellectual property used or displayed are the ownership of their respective owners. This article is © 2019 Capital One.