ICOs: The Beginning Of Post-Capitalism? Some Say Yes — Here’s Why
The definition of capitalism is: “an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by state.”
Blockchain technology is, quite literally, the opposite of that.
There has been an emerging thought recently that we are beginning to enter what some would call “post-capitalism” — an economy promoting a new set of values, and thus encouraging different behaviors. According to journalist Paul Mason, this is becoming possible because of informational technology in the following ways:
1. Information technology has blurred the lines between the conventional “hours for dollars” value of work. This means we cannot accurately measure the “worth” of an employee in the same ways we did in the 18th and 19th centuries, when British historian E.P. Thompson first introduced this idea of clock-based time and its relation to productivity. Since then, and in post-industrial economies, clock time has been the standard for maximizing production in capitalist economies.
2. Information is moving in opposition of corporations that create valuations based off private data. Over the past several decades in particular, there has been an exponential demand for humanity’s access to both data and ideas. This, in itself, is a threat to private companies that thrive off scarcity — and where we are headed as a society is not toward scarcity, but an abundance of information.
3. Information has increased the ability for collaboration across all industries. Where before companies and even people were limited by their surroundings and resources, information and technology has removed those barriers to entry. The example Mason provided was Wikipedia, and how a volunteer-based, free information product, essentially abolished the encyclopedia business while simultaneously depriving the advertising industry of an estimated $3 billion per year in advertising revenue (since Wikipedia does not allow ads).
When you frame the above in the context of both the capabilities and mission behind blockchain technology, you can start to imagine what a post-capitalism society might look like.
One word: decentralization.
There are tremendous benefits to information decentralization. This is, after all, the point of using blockchain technology. The idea is not for a private entity to own a user’s information or transactional data, but rather for the network itself to be the validator — and then house that “Smart Contract” forever on the blockchain.
If this were to become a leading force in major industries, power and ownership would be restored to the people. Honestly, this was the idea behind the Internet, which is about as close to “collective ownership” as we’ve gotten. But the real version of a shared economy would be based on the blockchain, where everyone in the community owns a piece of the means to anything from production to real estate.
Two recent examples of this already beginning to happen are:
- Co-ownership of co-working spaces, built on the Ethereum blockchain.
- Investing in real estate through Ethereum’s Smart Contracts, allowing access to global investments while simultaneously earning Ether.
A potential future scenario of how this shared-economy technology might play out is in which all inhabitants of a city all own parts of the buildings.
There are also cons to decentralization.
First, without centralization or regulation, there is room for insidious people and “bad actors” who find ways to disrupt the system.
Imagine someone who hacks the cell phone of an actor or actress and releases their personal data (like compromising photographs) on the Internet. As it stands now, that person, who has the right to their image and use thereof, can sue the publications that share those images and demand they be taken down. But in a decentralized world, who do they go after? There is no one to sue, because no “one” owns the network. It is collectively owned by the people.
A second, and potentially far worse, scenario would be if the above victim’s photographs were posted on something like Filecoin, which is working toward decentralized file storage. In a moral, shared economy, it’s a fantastic idea — but in a case of compromised personal data, the second that photo is posted to Filecoin, it is replicated on every system globally and is immutable. It cannot be taken down.
That is concerning.
First, it’s worth acknowledging that we have already begun moving toward a post-capitalism model, whether we like it or not. Technology itself is beginning to build a decentralized world, so the real question is how we, as a society, can continue to evolve with it.
Second, decentralization can (and will) exponentially impact technology as we know it. Today’s blockchain uses are still in their infancy — try to think back to what the Internet looked like in the early 90s. We still don’t know how it’s going to play out, which means there is still a lot of exploring to do. Truthfully, we don’t know the answer yet.
Third, new companies will try to keep the benefits of decentralization but find a way to reverse the unfortunate outcomes (like the Filecoin example). But that is just another form of capitalism: creating a problem to then create the solution.
Blockchain startups are a clear marker of what we could label as the beginning of post-capitalism. But what that sort of economy will look like in its final form still hides in the unknown.