This Dreamers Blockchain Contract is being proposed for a firm dealing with immigration law in the San Francisco Bay Area.
What is a Blockchain Contract?
Exciting things are happening in the business world due to the emergence of blockchain technology. Blockchain opens up the possibility for a new, collaborative and individually empowering means of doing business without borders and without the need for regulatory organizations or other intermediaries.
Blockchain empowers people in two ways that have up to now not existed — a) the ability to legitimize innovation and new products without seeking approval from governments and b) the ability to create financial assets out of non-profit based transactions. If a cause has followers, it can be funded very easily on blockchain which is normally unfundable in a government-based legal regime. For instance, on blockchain, ten people could create their own bank without seeking a license from the government. In a central bank dominated banking system, a bank cannot exist unless approved by the central bank. Another new possibility, a financial asset can be created out of a social cause and the gains from that financial asset will be able to fund that social cause as long as enough people support the cause. In a non-blockchain world, only donations and charities can fund a social cause whereas in the blockchain world a social cause can be funded by profit-seeking behaviour in addition to donations and charity.
A Blockchain is of no use until it can get people to cooperate toward a common cause. That common cause has to be expressed in terms of obligations and benefits of all parties involved in the cause. Obligations are what the parties perform and benefits are what the parties gain as a result of their performance. Blockchain Contracts are an expression of obligations and benefits of all parties involved, as written on the blockchain. Another way of looking at it is that blockchain is a technology and a Blockchain Contract is the human application of that technology. Blockchains are useless without Blockchain Contracts. Human innovation in blockchain is at most a technological innovation, but human innovation in Blockchain Contracts is a social innovation which can transform human lives. When we speak about blockchains being revolutionary, it is the Blockchain Contracts, rather than blockchains themselves which are the cause of the revolutionary transformation. That is the reason why focusing on Blockchain Contracts rather than blockchains would yield greater dividends for mankind. This is why Blockchain Contracts are the core pillar of Ranchi Mall’s efforts and innovations.
The current way of putting business agreements onto the blockchain is called a smart contract for which all the decisions, once coded by the contract creators, are automatically implemented by software. Blockchain Contracts, on the other hand, assign a primary role to human judgment in blockchain-based contract decisions. Human judgments are superior to machine judgments in matters of unexpected events that can occur during the course of a contract. As a result, Blockchain Contracts perform much better than Smart Contracts in real world scenarios where uncertainties exist.
The emergence of blockchain technology has paved the way to redefine all economic relationships, some of which will have social impact. Blockchain is an internet space where interested individuals from all over the world can agree upon a course of action and then fund it. The funding is done primarily with the interest of having higher future valuations to their financial interests. The financial interests of each of the involved parties is tradable in the group. This tradability creates the economic value behind the blockchain contract. Since the space of collaboration is not limited to a country, the overall financial might of blockchain contracts can be greater than economic mights of countries. Blockchain contracts create a way forward to solve some of the socio-political problems that arise because humanity is presently divided into multiple countries, some of whom are more successful than others. One of the many problems this creates is the Dreamers problem in the United States of America. In 2012, around 800,000 people who had entered illegally into USA were given the temporary right to live, study and work under Barack Obama Administration’s DACA program. Most of the Dreamers are from Mexico, El Salvador, Guatemala and Honduras. They range in age from 15–36. President Trump announced plans to scrap DACA, thereby removing the temporary protection for undocumented migrants who arrived in the US as children.
The Basic Scheme of the Blockchain Contract
There are four entities in this proposed Blockchain Contract: The Dreamers who face deportation, the dreamers who get deported, the investors in the Blockchain Contract, and the Administrators of the Blockchain Contract. Since the Dreamers issue affects a lot of people, it has become politically sensitive and has gotten a lot of media coverage. In traditional politics, parties who are out of power and who want to support the Dreamers can only do so by appealing to the President and the Congress. In the blockchain world, it is possible to support the Dreamers by creating a financial asset whose performance is based on the number of Dreamers that get deported. This changes the traditional dynamics of getting deported from the United States of America, from an economically losing proposition into an economically profitable position. The Dreamers Blockchain Contract will fund the Dreamers who get deported out of the US to start their lives anew in their new countries or countries of origin, as the case may be. Since it is not possible to mass deport all the Dreamers at the same time, it is possible for the limited funding initially available at the start of this Blockchain Contract to support all the Dreamers who actually get deported. Over a period of time, the deported Dreamers will start contributing economically to the Blockchain Contract. That will create new funds to financially support the subsequent deportees. In addition, a lot of people who are concerned with the plight of the Dreamers would be able to contribute financially to make the program financially viable. Blockchain Contracts are not an extinguishable financial contribution like crowdfunding or social/political donations. Instead, they are a tradable financial asset which increases in value like stocks of successful companies like Google and Facebook. A cause that generates a lot of media interest will also attract a lot of investors in the blockchain world. The economics of internet, where relatively few producers can support a large group of consumers, just like Wikipedia does, will also apply here. Effectively, this means approximately 5% of deported Dreamers are sufficient to produce the efforts, the benefits of which can be consumed by 100% of the deported Dreamers. However, this would need the administrators to efficiently allocate work to eligible Dreamers who get deported. The area of work allocation could include: internet technology, blockchain technology which would need reskilling of the deported Dreamers. This could be performed purely through online learning. Work can also be allocated based on existing skills of the deported Dreamers.
The role of the administrators would be to structure the Blockchain Contract, scout the initial investors, structure the overall economics of the Blockchain Contract, create the pool of Dreamers that need funding in such a way that the Blockchain Contract does not get defrauded, keep track of the Dreamers that could potentially be deported and, bootstrap the program through an experimentation process to ensure successful execution.
Traditionally, blockchains have been able to create assets with no financial underlying giving it value, like Bitcoins. The Dreamers Blockchain Contract is superior, in that respect, in that it is backed by the economic contributions of the deported Dreamers. Even though the economic contribution may be marginal, it is sufficient to create enough valuation to fund deportation services for all deportees.
Such a contract is impossible to create within the framework of any country’s laws because the investor base feeding the contract would be too small to create enough funds to service all Dreamers. Also, since the Dreamers problem has been created by the party in power who will create legal and financial hurdles for the initiation and execution of such a contract. The relative anonymity available to blockchain participants creates the safeguards necessary to make it possible in blockchainland where it is not easy to identify the funders of the contract. This contract will primarily fund the Dreamers who actually get deported but an incentive structure could be created such that Dreamers facing deportation and contributing more to the contract get priority servicing. That will increase the financial viability of the contract.
To execute this Contract, one needs to subdivide the root Dreamers Blockchain Contract in 1 billion subunits each to be initially sold at $1 apiece acceptable in any of the widely recognised cryptocurrencies. This will create an initial corpus of $1 billion USD. There are approximately 800,000 Dreamers. If all of them are deported, it would need $100,000 per Dreamer leading to 80 billion USD of total expenses. However, not more than 100,000 Dreamers would be deported as it is impossible to physically locate each of them. So, it is anticipated that $10 billion USD would be sufficient for such a program. At least five blockchains have achieved a valuation of 10 billion USD including Bitcoins, Ethereum, Ripple, Bitcoin Cash and Cardano. Therefore, achieving a 10 billion USD valuation for such a contract is not unreasonable.
The Dreamers Blockchain Contract could be the first mass scale application of blockchain technology to solve a real world problem. It will meet the objectives of the US government that wants to deport the Dreamers by making it easier to deport them as, after deportation, they will have a financial future. It will also meet some of the aspirations of the Dreamers who will have an economic future after deportation. It will transform a win-lose incentive in the Dreamer deportation scenario between the government and the Dreamers into a win-win incentive program for both the government and the Dreamers.