7. How do you lead the creation of a new token standard and economic models? Ask Matt Lockyer creator of Composables ERC-998

Play the Game : The Evolution of Trust by Nicky Case
“Lighthouses don’t go running all over an island looking for boats to save; they just stand there shining.” Anne Lamott

Have you been wondering about the Ethereum magicians, Nifty Magicians and Mokens?

Do you have an idea for a new token standard and want to turn it into a reality?

Listen to the Blockchain Executive Radioshow’s fascinating conversation with Matt Lockyer, Founder of Soloblock Solutions Inc, original creator of Crypto Composables ERC-998 and token engineering advisor to FansUnite Entertainment Inc.

Matt demonstrates how having a beginner’s mind, enabled him to identify blue sky opportunities and develop new ideas for token engineering. He stepped into the “permissionless” innovation paradigm, putting in effort to research, design and craft a thoughtful strategy for proposing the new Crypto Composables ERC-998.

In the interview Matt provides us with clear examples of how to move from generating ideas to sharing his design techniques and then how to bring this into action. He further shares tips for engaging a decentralized, peer-to-peer communicate, what it takes the operationalize such a project and also how to navigate the ecosystem for strategic economic value creation.

It is also important to hear how Matt approaches game theory and game design, and how he was influenced by the book Finite and Infinite Games by James Carse (more information provided below).

He also shares his passion and involvement in designing and facilitating radical markets events, including token engineering workshops. He describes the different skills he applies from ideas to design, action, engagement with decentralized communities, navigating these spaces as well as operationalizing new standards and projects.

Watch this interview with Matt below where he describes what NFTs are (as part of his education activities).

Character Strength: Love of Learning

“Love of Learning falls in the virtue category of Wisdom. Wisdom deals with strengths that involve the way we acquire and use knowledge.

Love of learning describes the way in which a person engages new information and skills. Love of learning is a strength that teachers would like to see in their students, parents want to encourage in their children, therapists support in their clients, and employers try to foster in their employees. It has important motivational consequences because it helps people persist through challenges, setbacks and negative feedback.” VIA Institute on Character Strengths

Personal leadership reflection

  1. Matt describes having an action oriented mindset to your ideas, to write it down and then publish and engage with the community around it. What ideas do you currently have that you could quickly write up as a proposal and test with the community?
  2. How has having a beginner’s mind been an advantage to Matt? Where can you bring a beginner’s mind to your work and life and play?
  3. What are you doing to keep learning and growing?

Fun fact about Matt:

He likes rap. Here is a fun one: Rock on Hanuman

Leadership Web 3.0 Principles, Practices and Habits

“Within an incredibly short time and space, the Internet is becoming dramatically mobile, social, video and artificially intelligent — encompassing everyone and everything, becoming ubiquitous as water, air or electricity. In this context, it is crucial to embrace yet to humanize and transcend technology; to hone in on what makes us truly human rather than a ‘better machine’: things such as imagination and intuition, creativity, problem-solving, complex understanding, improvisation, emotions and plasticity.

We must therefore let go of the ‘machine-work’ — and most its traditional metrics, KPIs and success measurements — to truly reinvent what our jobs, work and ‘professional services’ can mean in the future.” Gerd Leonhard

What is ‘Game Theory?

“Game theory is the study of human conflict and cooperation within a competitive situation. In some respects, game theory is the science of strategy, or at least the optimal decision-making of independent and competing actors in a strategic setting.

The key pioneers of game theory were mathematicians John von Neumann and John Nash, as well as economist Oskar Morgenstern.

Read more: Game Theory” Reference by Investopedia

Learn more about it by playing the excellent interactive simulation game to learn and simulate different player populations, payoffs and rules, resulting in different types of outcomes (wins). There are limitless simulations available in the sandbox portion of the game (and no-one is harmed in the process).

Why is is important to understand game theory in the distributed digital economy?

Game theory is foundational to not only economic models, but also machine learning and other computer technologies such as blockchain. These incentive schemes shape our human behaviour and ultimately have real impacts in the real world, including our individual and collective planetary prosperity and wellbeing.

It is also important to remember that these are all manmade “operating systems” — some originating from many centuries ago when the world was a very different place with different worldviews and belief systems.

With the possibilities offered with new technologies and scientific research, we can realizing that we don’t need to bring ideas from previous worlds into the distributed, digital economy.

An example of the importance of game theory in enabling the peer-to-peer economy is the Bitcoin protocol. The Nakamoto protocol enables parties who do not need to trust each other or a third party, to be able to send value almost instantly and cheaply across the world wide web using a communication interface in a distributed autonomous manner. The reward for participants for “playing the game” is determined based on the principles of game theory, using cryptographic algorithms to creative incentives that prevent cheating or changing historic records, through proof of work.

Game theory for the distributed digital economy

“A new set of web technologies are enabling a more distributed economic model based upon the blockchain and token markets. These token markets greatly reduce our dependency on centralized organizations and expand markets as systems of distributed organization. In this video we explain the workings of the blockchain, tokens, distributed markets and token investments.” Complexity Labs Course, September 2017

Watch their video “The Distributed Token Economy Explained”.

How can you apply game theory to change impacts on our individual and collective behavior and therefore establish new economic models?

“Think about the last time you played a new game. Remember? The first thing you did was find out what it means to win and that guides every decision you make along the way.” The Story of Solutions by Annie Leonard and Jonah Sachs:

By changing the game, the distributed digital economy can become a new operating system that, for example, can be

  • regenerative,
  • reclaiming the commons (including cyberspace) and democratic (everyone is able to have a say and influence how the future is shaped) and
  • promotes the circulation of value amongst customers.
  1. Regenerate
Image Prout Institute
  1. to effect a complete moral reform in.

2. to re-create, reconstitute, or make over, especially in a better form or condition.

3. to revive or produce anew; bring into existence again.

4. Biology. to renew or restore (a lost, removed, or injured part).

5. Physics. to restore (a substance) to a favorable state or physical condition.

1425–75; late Middle English (adj.) < Latin regenerātus, past participle of regenerāre to bring forth again,equivalent to re- re- + generātus;

Reference: Dictionary.com

Read the report from the Capital Institute on Finance for a Regenerative World and Economy for an overview about the new domain of Regenerative Finance.

2. Reclaiming the commons and peer-to-peer democracy to co-create a more egalitarian and environmentally conscious planetary culture

The protocol economy can enable a commons transition.

“What is the aim of a Commons Transition? — To create a deeply democratic society where everyone matters and has a say; an inclusive representation of class, race, gender identity, sexual orientation, ability, and/or immigration status. In fact, the proposals we share go beyond rhetoric. They are inspired by active, successful, self-organized working communities that sustain themselves and their environments.”

“When value created in P2P systems is distributed back to the value creators, and when the entire process is decided on by peers and directed towards encouraging shared resources, the outcomes are radically different.

This describes the underlying logic of the Commons Transition. A social process more than an ideological destination, it applies the wealth of networks toward community-enabled capacity building, beginning where we live and work.”

Reference: The Commons Transition Primer

3. Circulating value amongst customers

“All of my ideas are really optimized towards promoting the circulation of value amongst your customers, rather than taking value away from them.
How do you make other people rich?
That is what a distributed, digital economy is all about.” Douglas Rushkoff author of Throwing Rocks at the Google Bus

What can you do to design new rules for the game?

Life is the most precious resource we have. (Mr Peanutbutter’s brother, Bojack Horseman Show).

Below is a simple example on how changing simple rules can create positive impact in particular social, environmental and economic wellbeing.

Questions for your game design

Positive Mavericks principles focus on positive outliers. The questions below are designed to help you think outside current dominant paradigms, while also placing intent on increasing prosperity and wellbeing for yourself, your communities and strategic eco-systems.

  1. Are you designing a finite or infinite sum game?

“Thirty-five years ago, James Carse wrote a book called ‘Finite and Infinite Games: A Vision of Life as Play and Possibility’. Over three decades later, it remains popular. In this podcast we explore what the ideas expressed in the book could mean when applied in a political space.

A finite game is played to be won and an infinite game is played for the purpose of continuing play. In this episode, Mark calls James Carse to explore questions about how the ideas in his book apply to politics and public life.”

Listen to this interview/podcast with James Carse to gain a deeper understanding:

You can also read his book (referenced by Matt Lockyer)

Watch the short explanation below:

2. Are you designing a prosperity game or a monopoly game?

“The Landlord’s Game (Prosperity Game) is a board game patented in 1904 by Elizabeth Magie as U.S. Patent 748,626. It is a realty and taxation game intended to educate users…”

Image: The Landlords Game board, based on Magie’s 1924 US patent (no. 1,509,312)

“A win in the Landlord’s Game called the “Prosperity Game”, was when the player having the lowest monetary amount has double his original stake. “

Surviving copies of The Landlord’s Game by Parker Brothers is considered by many the rarest of all 20th century board games.

“The game’s first patent was the first issued for a game while claiming four features in the application, the most important features was continuous path game. At the time, most games had a start and end spot.”

(Wikipedia, May 2017

Contrast this to….

Monopoly or sub-titled “The Fast-Dealing Property Trading Game”, is named after the economic concept of monopoly — the domination of a market by a single entity. It was created by Charles Todd in 1932.

Imagine: The original Monopoly patent (Wikipedia, May 2017)

It is now owned and produced by the American game and toy company Hasbro.

Players move around the game-board buying, trading, or selling properties, developing their properties with houses and hotels, and collecting rent from their opponents, with the goal being to drive them all into bankruptcy, leaving one monopolist in control of the economy.”

3. Are you designing based on the laws of entropy or syntropy?

“Entropy involves the tendency of energy towards dissipation, the famous second law of thermodynamics, also known as the law of thermal death or disorder. On the contrary, syntropy implies the tendency to concentrate and absorb energy, the increase in temperatures, differentiation, complexity, the formation of structures and organizations.”

Reference: Sintropy.io

“From Greek syn=together, tropos=tendency. It was first coined by the mathematician Luigi Fantappiè, in 1941, in order to describe the mathematical properties of the advanced waves solution of the Klein-Gordon equation which unites Quantum Mechanics with Special Relativity.

As noted by Viterbo, syntropy is “the tendency towards energy concentration, order, organization and life” (http://www.syntropy.org/).

In contradistinction to “entropy,” syntropy is a result of retrocausality leading to persistent and more complex organization.

This is akin to the concept of dissipative structures developed by Ilya Prigogine, expostulated in Order Out of Chaos, by Prigogine & Stengers (1984).

Buckminster Fuller developed a definition in relation to “whole systems” as “A tendency towards order and symmetrical combinations, designs of ever more advantageous and orderly patterns. Evolutionary cooperation. Anti-entropy”

In 1988, Mario Ludovico gave a formal definition of syntropy as a measurement of the degree of order/organization internal to any system formed by interacting components.

According to that definition, syntropy is a quantity complementary to entropy: The sum of these two quantities is constant for the system considered, and defines the transformation potential of the system.

On this basis, the theory develops equations apt to describe any possible evolution of complex systems, particularly concerning biological/social systems.

Reference: Psychology Wikia

Syntopic Farming was developed by Ernst Götsch (originally from Switzerland).

To see the extraordinary results of Syntropy, watch this short documentary to see how a different worldview and “rules of the game” creates abundance and regenerates arid landscapes. Imagine what these principles can do when applied to other aspects in life, including economic/game design.

4. Does your game design intent to contribute to the financial economy or real economy? (What is your impact going to be?)

The concept that we will refer to here was developed by David Korslund, of the Global Alliance for Banking on Values, who talks about several degrees of separation from the real economy.

“And we thought that’s a helpful intellectual concept that we want to briefly touch on here.

So David distinguished between the two poles: the financial and the real economy, and gives several examples.

If you buy an office building, you have a farm, that’s obviously the work in the real economy. And then you can step by step basically separate financial interactions from the real economy.

An example for a first degree of separation are loans.

An example for a second degree of separation are liquidity deposits, which banks need to do in order to stay liquid. So there is definitely investment that banks engage in that has a two degree separation from the real economy.

An example for the third degree are credit default swaps. And when we come into the area of the fourth degree, then we enter this area of repackaging of investments where money actually makes money. And obviously these are not clear distinctions.

There are always blurring boundaries. But we felt this is a very helpful distinction to get a little bit of better understanding of what is this field of the real economy and the financial economy.”

Reference: MIT MOOC: Just Money: Banking as if Society Mattered)

Watch this video clip from the MIT Mooc below to understand the difference between conventional banking and “just Banking”

5. Is your game design based on complex responsive processes or complex adaptive processes?

  • Complex Responsive Processes (human complexity)

Unlike the living organizations described as agents in complex adaptive systems, according to Ralph Stacey the sciences of complexity of human action “needs to be interpreted in a manner that takes full account of the attributes of human agents, namely, that they are conscious, self-conscious, emotional, often spontaneous, often thoughtful and reflective beings who have some degree of choice over what they do”.

“Human agents are basically interdependent, they respond to each other and their choices and intentions play into each other producing unpredictable, emergent patterns over time. To signal the move from the domain of natural sciences to the domain of human action, Stacy and colleagues refer to these processes as Complex Responsive Processes of Relating. These responsive processes take the form of:

  • communication understood, drawing on George Herbert Mead, as conversation;
  • patterns of power relations which take the form, drawing on Norbert Elias, of the dynamics of inclusion-exclusion and identity;
  • ideology as a combination of values and norms, drawing on the work of Hans Joas, William James and John Dewey; and
  • evaluative choices.”

It is in these local responsive processes that there emerge population-wide patterns of activity, culture and habitus. Organizational life is though of as the game people are invested in and organizing processes are understood to be the ordinary politics of everyday life.” (Wikipedia)

  • Complex Adaptive Systems:

The typical swarm intelligence system based on complex adaptive systems theory has the following properties:

  • it is composed of many individuals;
  • the individuals are relatively homogeneous (i.e., they are either all identical or they belong to a few typologies);
  • the interactions among the individuals are based on simple behavioral rules that exploit only local information that the individuals exchange directly or via the environment (stigmergy);
  • the overall behaviour of the system results from the interactions of individuals with each other and with their environment, that is, the group behaviour self-organizes.

6. Does your game design and economic modelling enable strategic cooperative eco-system models, such as worker cooperatives or public cooperative networks?

The Prout Institute recommends asking four questions in evaluating successful, sustainable economic models:

  • Does it help meet people’s essential needs?
  • Does it provide opportunities for meaningful work and increasing purchasing capacity?
  • Do local people control and manage it? And do so for their common welfare?
  • Does it keep resource, productive capacity and wealth working regionally for local development — and not draining away to serve outside interests?
Diagram: Cooperativa Integral Catalina

Watch this research from the Prout Institute on local economies that are positive outliers: cooperative economic models in countries with large unemployment and inequality.

Below is the summary of the criteria for sustainable and regenerative strategic eco-system development which can be applied in your roadmaps for distributed digital economy and your projects/initiatives.

  • Balanced Mix of Cooperative and Small-scale Enterprises: To foster innovation and build resilience capability​
  • Diversified Capitalization: To empower entrepreneurialism and facilitate community supportive investment​
  • Integrated Production and Distribution Networks: To coordinate planning, promote efficiency and build the total eco-system and value chains
  • Engaged Learning: To educate community members in new values, approaches and techniques​
  • Participatory Governance and Decision-Making: To promote social equity and solidarity​
  • Formal Authority: To establish autonomy, secure legal standing, and facilitate reciprocal partnerships​
  • Celebration of Culture and Identity: To promote common cause and unity-in-diversity​

Reference: Peat Institute: Strategies and Lessons for Building Localized, Regional Economies

Listen to the Upstream podcast documentary series to investigate emerging economic models.

What game theory can do to contribute to success

Humans and animals love playing games. It generates joy, is a core way to learn and grow, and can foster wellbeing and self-confidence.

It can also have a positive impact on spectators.

A well designed game, such as the simple Fortnite, can become a global movement.

Personal and Team Leadership Reflection and Development Activities

Is distributed the new Operating System for the Economy?

Watch Douglas Rushkoff’s google talk below to find out the history of peer-to-peer marketplace and diverse local currencies, innovations in Western Europe after the Crusades — resulting in the rise of the merchant class and history distributed economic growth.

He also shares how the feudal lords (aristocracy) created a counter response and to protect their wealth and status by creating two innovations as core tenants of a new operating system to slow the rise of the merchant class. These were a charter of monopolies and a charter for central currencies.

  1. Chartered Monopoly: One business is chartered by the king to be in charge of an entire industry and everyone has to work for that person. This is when employment was invented. Instead of selling the value I created, I was selling the time I spend in creating the value.

2. Central currency: All local currencies were made illegal. When you wanted money to make something, you had to pay interest. It allowed people who had capital make money by borrowing to others. The problem of interest bearing currency is that you have to make more to pay back at the compounded interest. This therefore bias everyone towards growth.

Questions

  • Which underlying values of current platforms, the economy and business are you accepting as pre-existing by nature rather than a specific “operating system” developed at a specific time in history and with specific needs in mind that might be obsolete in our current set up, digital age and environmental situation?
  • How can your current gamification design enable mass adoption using some of the design lessons learnt from emerging new peer-to-peer, regenerative and cooperative models?
  • What can you learn and apply from the Monopoly Game versus the Prosperity Game?
  • Create an event or workshop to to a deeper dive into one of the game theory models as listed above.
  • Create different scenarios of the Game Theory Simulation Game — The Evolution of Trust — to design your economic model and test your assumptions.

Ready to try a Leadership Practice Tool: Pattern design

  1. Review the “how” design questions and information.
  2. Create a matrix using two design intentions to create a frame for pattern sensing and design.For example

a) Monopoly Game and Prosperity Game

b) Extractive Economy and Regenerative Economy

3. Do a deeper dive into each of these, for example, study the resources provide in this article to gain more insights.

4. Create key elements of each of the four quadrants of the matrix — these are four difference economic models and their unique scenarios.

5. Finalize which quadrant your economic model will focus on, and create your design, including strategic eco-system development strategy to achieve that scenario.

Example developed by MaRI Eagar

Fun Cultural Immersion: When different worldview and economic models converge….

Watch this cult classic — a comic allegory about a traveling Bushman/XoiSan who encounters modern civilization and its stranger aspects, including a clumsy scientist and a band of revolutionaries.

Below is a short extract highlighting a different worldview of ownership and scarcity that has existed for the KoiSan, who inhabited the southern parts of Africa for thousands of years. They lived long and healthy lives, and spend less than three hours a day “working”.

Use the Leadership Web 3.0 publication for a cultural immersion. Start a Leadership Web 3.0 Community of Practice. Contact MaRi Eagar to find out more.

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