Decentralized Law on the Ethereum State-Machine
When Satoshi Nakamoto invented the blockchain 7 years ago, he made it possible to do trustless transactions. So called alt-coins sprung into being after that, specialized for certain types of transactions, namecoin, litecoin, darkcoin, etc. Fast forward to 2013, Vitalik Buterin had the idea to build a blockchain that could be programmed to perform any type of transaction, and he started the ethereum project to build a general purpose blockchain.
The same innovation process happened back 40 years ago with the invention of the general purpose computer, when people saw that the calculator chips at Intel, designed for specific types of transactions, could be changed to be programmable, and this led to the general purpose computer.
Ethereum is the first general purpose blockchain computer, and ether is the fuel that is used to pay for every single computational step. The invention of ETH makes it expensive to use up too much of the blockchain computers capacity. Ether is the fuel you need to run smart-contracts. If Bitcoin was digital gold, then ether is digital oil.
The ethereum project is the first “state-machine” and it is the successor of nation-states which is the machine we used to compute legal contracts in the past. Ethereum has much higher processing power and bandwidth than “Westphalia”, the previous world state-machine, and is capable of running new types of social organizations that were hard to host on “human blockchains”.
“Westphalia” is a special purpose computer. The human brain is an emotional machine, it has a memory limit known as dunbar’s number, and it is designed to mutate based on the connections it makes. As it is a mutational meme-machine, the human brain can only be loyal to and maintain consensus about a limited number of ideas/laws at a time, falling in love for example can lead a node to abandon all their previous promises, so Westphalia used hierarchical law-enforcement to create a form of consensus that could be trusted.
Because human loyalty is mutational, and Westphalia therefore runs on top-down signal control, Westphalia has a limited processing unit for validators, and therefore uses regulators to limit the types of transactions that can be performed.
Ethereum has outgrown the limitations of “human blockchains” and has none of those limitations. The state-machine uses ETH to limit the amount of transactions that can be performed, but other than that it is a general purpose state-machine in contrast to the nation-states which were special purpose machines.
Ethereum is the first of a new breed of distributed computers and a few years from now, these swarm-computers will look nothing like the current ethereum network, just like computers have evolved since the 70s, but they will still retain the essence that Vitalik et al built into this first breed of swarm computers, as in smart-contracts that are turing complete, economic incentives for storage, processing power and consensus, and everything else that’s talked about around this space.
