“On the Origin of Blockchains” — An Introduction

ID Theory’s Thought Piece on Blockchain Evolution

I think almost everything about humans and human civilisation is explained better by evolution than anything else.

- Naval Ravikant, Co-Founder of Angel List

There are numerous thought provoking articles that give a nod to evolution when describing the progression of Bitcoin, cryptocurrencies and blockchain.

Recent notable examples include Dan Held’s Planting Bitcoin, Tom Shaughnessy’s Mutating Toward Preeminent Protocols and Nico Papanicolaou’s natural selection piece.

However, these concepts are not new. They came to prominence after the release of the Tezos whitepaper in 2014¹, which described a mutating, evolving and self-amending blockchain. Consequently, this is something I have been mulling over for a long time.

I will take this line of thinking a step further in this series of articles, having identified undeniable parallels between the emergence of life on planet earth and the proliferation of decentralised technology.

It is a topic that is important to me for a couple of reasons. Firstly, I am the Chief Investment Officer of ID Theory, a London-based investment advisory company focused exclusively on blockchain projects and cryptoassets.

Secondly, I hold a Master of Research in Systems Biology with a specific focus on genetic regulatory networks and spent ten years of my career developing medicines. These twin perspectives have led me to write this series, ‘On the Origin of Blockchains’.

The series has already involved a lot of research to get it to the point where the first six sections can be released. In the coming weeks, I will be releasing several more sections, as well as developing any areas that can be improved with new information.

You can find all of the currently available sections below and I would appreciate any comments or feedback from interested parties.

Part I: Evolution and Ecology in Software

Part II: From Protocols to Network Participants

Part III: Network Success is Driven by Incentive Design

Part IV: The Genesis of Blockchain Life

Part V: Smart Contracts and “Cellular Complexity”

Part VI: Diversity in Blockchain Organisms

Part VII: Interactions with the Environment (coming soon)

Part IIX — X: A Cambrian Explosion — Exciting Industry Trends (coming soon)

Informing ID Theory’s Investment Themes

This series is more than just a thought experiment for ID Theory.

A lot of the discoveries in these articles have helped to inform key tenets of our investment thesis. Through the lens of biology, we have identified categories of cryptoassets and their associated networks that are likely to succeed within new and exciting commercial and societal structures, which are opening up as a consequence of decentralisation.

This allows us to achieve three things, all of which aid our investment management decisions:

• Estimate the size and structure of new niches that are created or old ones that have been expanded as a consequence of decentralisation.
• Evaluate the properties of cryptoassets and networks to predict those that are optimised to colonise each of the niches described above.
• Understand the metrics that should be used to monitor the growth and ongoing health of these networks as barometers of their success.

Consequently, we invest in the following areas, which are also explained in more detail in the ‘On the Origin of Blockchains’ series:

References:

[1] Tezos White paper — a self-amending crypto-ledger, L.M Goodman, September 2014

ID Theory may hold positions in some of the assets discussed in this post. This post is strictly for informational and educational purposes only and does not in any way constitute an offer or solicitation of an offer to buy or sell any investment or cryptoassets discussed herein. Always perform your own research and conduct independent due diligence prior to making any investment decisions.

Interested in partnering with ID Theory or building something special? Get in touch through our website or at info@idtheory.io.