Blockchain as a Process: Ideologies and Motivations behind the Technology
“We’re presently in the midst of a third intellectual revolution. The first came with Newton: the planets obey physical laws. The second came with Darwin: biology obeys genetic laws. In today’s third revolution, were coming to realize that even minds and societies emerge from interacting laws that can be regarded as computations. Everything is a computation.”
― Rudy Rucker
Blockchain is, without any doubts, the buzzword of the year.
In a similar fashion to what happened with social media in 2008/09, this disruptive technology is changing thousands of LinkedIn biographies to “blockchain consultant”, “blockchain expert” and “ICO advisor”. Herds of experts, solely armed with their phantom knowledge, are slowly saturating the market. At the moment, the best skill to have in the sector is the capacity to discern between improvised experts and the few who really have the competences. Several businesses, such as Long Island Iced Tea Corp have tried to ride the wave by renaming their business in whatever included the word “blockchain”, resulting in their shares rising as much as 289 percent. While currently used as a marketing tool, blockchain is much more than that. It is an innovation that could fundamentally alter the current paradigm, leading to major changes.
Deemed as a great improvement for business and debated at length regarding its benefits and shortcomings, blockchain has an ideological element which is often left out of the equation, due to the dominance of the technological and economic logic. The current state of the art mainly focuses on the practical changes that blockchain-based solution can produce for the market and the economy. Indeed, technology is too frequently discussed as though it is ideology-free, both neutral and necessary at the same time. It is often portrayed as value-free and progressive, with the sole aim of moving forward and making the world a better place. While blockchain’s influence on businesses and companies has been debated at length, it could have a great impact in other intangible areas, such as reducing the power of a central authority and increasing liberty and freedom for individuals.
1. What is a blockchain?
In simple terms, it is essentially a distributed database record — or public ledger — of all transactions that have been executed and shared among participating parties. It is constantly growing, as new blocks are added — in a linear, chronological order — to record the most recent transactions. This historical chain, containing every transaction ever created and verified in the system, has come to be known as a blockchain. Each transaction in the public ledger is verified by consensus by the participants in the system: since the system is decentralized, anyone who wishes so can contribute computational power, acting as a node of the network. Each node in the network maintains and can access an equal copy of the entire history of the blockchain, making impossible to alter or corrupt it and providing a certain and verifiable record of every single transaction ever made.
In other terms, it is much more than that. Blockchain can be regarded as the technological representation of much deeper ideas, rooted in a clash of opinions regarding the way we manage our society. The current system is considered to exist on principles that no longer stand up to scrutiny, imposing its truth upon us to assert its rule. The centralized model is deemed to be inefficient and simply wrong. Participants in society have little, if any, impact on political life and the current way of running our society is not subject to scrutiny and very hard to improve. Blockchain provides an indirect solution by distributing the system among its participants, in a similar fashion of “the law is equal to all”. While it does not represent a ubiquitous solution to our problems, it does represent the first viable alternative to fundamentally renovate the current paradigm.
2. Blockchain as a Process
Because of its novelty and disruptive properties, as well as its cutting-edge technology, blockchain is often understood as a completely new phenomenon that emerged and now promises to drastically impact our society. However, this would mean not having a full picture of the ideologies, motivations and the technologies that made what we nowadays call blockchain possible. We are not dealing with an innovative solution that came up from nowhere, but rather with a slow process that was brought to life by integrating older ideas with newer technological components. It took a whole lot of time to transform what were mere ideological speculations into a functioning technology. Thus, rather than a single phenomenon, blockchain has to be conceptualized as a process. The next paragraphs will provide an overview of the ideologies and the technologies behind the blockchain.
3. Ideological Elements of the Process
Technologies are inherently ideological, although too often not considered as such. Blockchain brings together two ideologies that might be considered as different, that found common ground in the technology: cyberpunks and libertarians. Aside from its technological component, blockchain was fundamentally a political idea, attracting followers among libertarian and anarchist groups who saw in distributed systems the power of removing control from the grasping hands of governments.
3.1 Cyberpunks
The word “cyberpunk” first appeared on a short story published in a science fiction magazine, in November 1983. Little did the author know his fantasy word would have been used in such a revolutionary way. The words “cyber” and “punk” emphasize the two aspects of cyberpunks: technology and individualism. The movement stands for all of the shy kids, excluded by the common Darwinian logic, who find shelter in the technology as a tool to rebel. They even go as far as defining themselves as “different, outsiders […] technological rats, swimming in the ocean of information”. Their philosophy questioned the taught ideology of a centralized state that everyone follows blindly, by resorting on individualism. Historically, discussions regarding peer-to-peer distributed systems and cryptography (fundamental backbone elements of blockchain) have been integral part of cyberpunk events and the brightest minds in the subjects have often been linked to the movement. By rejecting an ever-imposing authority, cyberpunks valued individuality and freedom to be in the shadow of a rotten system.
3.2 Libertarianism
The libertarian current is a collection of philosophies and movements upholding liberty as a core principle, thus seeking to maximize political freedom and autonomy. Libertarians assert that every individual has a “self-property”, owns himself and thus has right to life, liberty and property. No man should have power over another man’s right an liberties. Origins of the movement can date as far as the 6th century B.C. with Chinese philosopher Lao Tzo, best known as the author of the Tao Te Ching. Nevertheless, despite the example of Lao Tzu, libertarianism really arose in the West, where the struggle between the secular powers and the religious powers gave breathing space for individuals and civil society to develop. A period particularly important for libertarians was the Reinnassaince.
“The Middle Ages were an era of mysticism, ruled by blind faith and blind obedience to the dogma that faith is superior to reason. The Renaissance was specifically the rebirth of reason, the liberation of man’s mind, the triumph of rationality over mysticism — a faltering, incomplete, but impassioned triumph that led to the birth of science, of individualism, of freedom”
Together with their cyberpunk “colleagues” libertarians share a skepticism towards authority and state power, although diverging on the correct system to replace the actual one. This difference is not only between different ideologies but also within libertarians, following the typical left-right dichotomy of common politics. On the one hand, left-libertarians view private property as a barrier to freedom and liberty, thus seeking to abolish capitalism and private ownership in a socialism-like fashion. On the other hand, right-libertarians advocate for a lesser role of the state, strong property rights and a laissez-faire ideology. Elements of libertarianism are clearly present in blockchain, although indirectly. It does not wish to reduce the power of the state, but rather transform the current top-down system to a distributed system, where participants in the network all share information between them, reducing asymmetric information and having knowledge of the changes taking place in the system.
4. Technological Elements of the Process
Just like blockchain can be considered as an ideological melting pot, the same goes for the technological elements that made it possible. Computers have been around since the early ’60, when the Defense Advanced Research Projects Agency (DARPA), an agency of the United States Department of Defense started to develop significant technologies, such as computer networking(the basis for the modern Internet), and graphical user interfaces in information technology. Other innovations, such as cryptography, peer-to-peer networks and digital time stamping have been around for much more time than we imagine. As a result, we should think of blockchain as the result of a process started during the ’80s and ’90s, along the development of Internet.
4.1 Peer-to-peer Networks
In peer-to-peer networks, tasks are partitioned among peers, who share a portion of their computational power (in the form of processing power, disk storage, etc.) to other participants in the network, thus removing the need for central coordination in the form of stable hosts or servers. They are defined as those networks exhibiting three main characteristics: self- organization, symmetric communication and distributed control. Self-organized networks automatically adapt to the arrival, departure and failure of nodes and lack a central point of failure. Also, peers are equally privileged participants in the networks; they are both suppliers and consumers of resources, contrary to the traditional client-server model. Communication is therefore symmetric, because peers act as both servers and clients. Furthermore, the network is decentralized because it has no control point or centralized directory.
4.2 Cryptography
The key feature that blockchain derives from cryptography is the encryption of its data and transactions. The encryption is the result of a process called hashing. It is defined as “running a computer algorithm over any content file (a document file, a GIF file, a video etc.) the result of which is a compressed string of alphanumeric characters that cannot be back-computed into the original content: a hash. This guarantees the incorruptibility of the blockchain system”. Asymmetric cryptography systems separate secrecy (privacy) and authentication (digital signatures) through the use of a couple of private- public keys.
4.3 Digital Timestamping of Documents
The development of a process to digital timestamp documents was a solution for the widespread problem of verifying or certifying when a document was created or last modified. The concept was based on cryptographically secure, collision-free hash functions: by applying a digital time-stamp to a specific hash, it will be univocally marked, thus ensuring that there will be no other hash colliding — as having the same time-stamp would be impossible. In case of problems or doubts it would always be possible to check the timestamp to verify the time and data when it was created. Furthermore, when dealing with the problem of possible false time stamps, there was also a hint to a primordial concept of consensus, whereby “the required trust” would be distributed “among the users of the service”. However, there was no further development of the concept, it was not clear whether this could be implemented at all.
5. Why so much noise about Bitcoin?
Whilst the previous applications and the developments occurred during the last thirty years were slowly pushing blockchain technology forward, they still looked like small pieces of a big puzzle. Bitcoin was able to provide the bigger picture and link those — seemingly — isolated features.
Bitcoin was defined as a “peer-to-peer electronic cash system”, whose main role was that of using cryptographic signatures as a solution for trust-less intermediations
The ideological elements mentioned above are well present in the whitepaper of Bitcoin by Satoshi Nakamoto, where he suggested that the motive for creating Bitcoin was actually anger at the current system. “The root problem with conventional currencies is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust”.
The message he wanted to send was that centralization of money is destructive and the only solution to this problem would be a truly brand-new decentralized monetary system. However, a pure independent model was needed and this represented the biggest issue which none of the previous cryptocurrencies could solve:
How it is possible to get everyone in a decentralized peer to peer network to cooperate, without the presence of a central authority?
Bitcoin solved this problem by employing a consensus model characterised by a system of incentives to align interests of the participants in the network. This was not to be decided by anyone, but was intrinsic to the mining algorithm, creating the necessary alignment of incentives needed to get miners to commit computational resources and run the blockchain.
While such improvements might be deemed as merely technological, the ideology component behind them is crystal clear. Bitcoin did not only solve a technological problem, but was rather a solution to more philosophical and ideological questions. It managed to create a system that lacked a central authority, while still being able to regulate itself and provide advantages to those willing to take part in it. It regulated a decentralized system while still guaranteeing its users freedom and liberty. Bitcoin was a great idea as a way to separate money from the state, receiving consensus from cyberpunks and libertarians alike.
6. Takeaways
While being far from exhaustive, the aim of this article was to reflect on the ideological origins of blockchain. It wishes to stimulate intellectual reflection and research on the topic, as well as providing a standpoint for future developments of the argument. Blockchain does not and cannot only be considered as a new technology, for it is much more than that. By englobing several ideologies and philosophical motivations, blockchain represents a possible alternative to a centuries-long diatribe, regarding the division of power between a central authority and those who are ruled by it. Discussions about blockchain are significant, because of the technology’s ideological dimensions. It is very important to understand that what might superficially look as a novelty, or a technological breakthrough, is really the work of decades-long developments and technological improvements, often resulted from an ideological standpoint. Since we live in a capitalist world, it is by no means a mistake to focus on the practical improvements that a technology can bring to companies and businesses. However, behind the surface, there are often other changes that are much deeper, although intangible. We can do a much better job at understanding technologies by asking what are the ideological underpinning of these technologies and how have they come to life. We have no crystal ball, as knowing the future of blockchain technology is not possible but what is sure is that its economic and financial benefits will eventually result in much deeper changes in the way our society works, more likely without anyone realising so, until it has happened.
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