Janus: Blockchain
This is part of a larger series called “Janus”, meant to illustrate trends, dangers, and applications of future technologies. It is written and published by Duke University’s Smart Home community.
The main introductory article contains links to other Janus articles.
It seems like everyone is talking about blockchain nowadays.
It’s really not a surprise. Blockchain’s been touted as having the potential to revolutionize everything from government, to financial transactions, to social interactions. The basic premise of the entire system is the availability of a public list of all transactions that have occurred since the start of the chain. Transactions are organized into “blocks” (hence, blockchain), and to make sure that every block in the chain is correct and not tampered with, cryptography is employed to generate hashes that satisfy a set of very difficult requirements. Thus, there can be a continuously verifiable chain of blocks that detail every transaction that has ever occurred using that blockchain. The hashes, which are difficult and unpredictable to solve, make it infeasible for any malicious actor to switch out a block arbitrarily.
The result of all this is a secure, immutable list of any transfers of information or value. And this has got a lot of people excited.
The promise of this technology is multifold. For instance, blockchain enables smart contracts, incredibly powerful programs that execute automatically when certain requirements are fulfilled. These are built directly onto the blockchain, meaning anybody can evaluate the program and determine for themselves what it will do, and see if they want to participate or not.
One application of smart contracts is predictive markets (like Augur), which is like a betting pool for real-world predictions. Only those who think they have a special understanding of the situation will bet on one decision versus another, and thus the market will have heightened and (hopefully) more accurate predictions of the future, due to unique and special insights by the contributors. No one with “ordinary” knowledge will want to bet, because they will essentially break 50/50, so the end result is only the most insightful and best predictors in the market actually submitting bets. When predicting the weather, for instance, a bet on whether or not it will rain in two days can be fulfilled if a series of sensors detect water, in which case those who bet on rain will be rewarded through a coin payment. This encourages accurate predictions, as well as contributions of knowledge when normally there would be none.
In financial transactions, blockchain is incredibly useful for transparency, due to the existence of public ledgers. Loyalty and rewards programs, for instance, will be more transparent and incentivizing for people to enroll in. Online identities can also be linked, so that information can be shared seamlessly and financial transactions can (not necessarily will be) tracked.
A future with a full (and safe) usage of blockchain would be vastly different from what we see today. For instance, in combination with smart home technologies, a smart contract with your doctor and dentist could detect that you worked out, flossed, brushed your teeth, and/or did the daily minimum requirement of squats they wanted, and reward you for doing so by automatically dispensing a reward. Or maybe contracts can be established to automatically save money and/or find the best pricing whenever you buy food from the supermarket, and punish you for buying unhealthy foods and meals.
Crazier ideas exist for blockchain. One is to make public bathrooms cleaner by punishing people for making them dirty in the first place. Another is to reward people for doing good deeds for other people, and thus incentivize good behavior, as well as provide secondary income. A side effect of this would possibly be less homelessness, and an emphasis on real social contribution, instead of simply tying value to the workplace.
All in all, blockchain’s potential applications are numerous and can absolutely revolutionize the way people interact and conduct business in the future. But clearly they have a few problems. For one, why are they not being utilized already? Where are, as investors are asking, the killer apps? Haseeb Qureshi made a very interesting post on Medium about this. Or maybe they already exist — and all these extraordinary claims are unrealistic applications that would never work in the actual world. As Haseeb argues in another post, perhaps “Blockchain is a 22nd century technology that fell by chance into the early 21st century”.
In addition, it’s hard to know whether or not these incentives and trust-less monitoring will lead to a society where personal integrity and will is underdeveloped, and habits are simply developed in order to get rewards. XPRIZE released a competition called Seat14C, and one of the sample stories featured a NiceCoin that, while arguably incentivizing social behavior in the story, could be badly misused if implemented in the real world. There’s also the distinct possibility of financial rewards tied to behaviors being utilized for nefarious purposes, such as by a government to control its citizens.
In the end, it’s hard to see how much blockchain will change the world. Whether or not it will ever develop the most transformative applications is a matter of debate. And even if the technology is applicable, should it be used? With increased calls for ethics in technology, there will be a (justifiably) tighter lockdown on a technology that has the power to revolutionize government, business, and daily social and personal life. The full application of blockchain by a malicious party could spell a disaster as problematic as a malevolent AI.
And as such, it is increasingly important for people to conduct further research into the subject, as well as critically analyze flaws in existing apps that could cause mayhem. Blockchain is certainly still in its experimental phase, and there is no better time for the world to make sure this fundamental technology is on the right path.
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