Blockchain - are we ready for a revolution?
Many of you will have come across that one acquaintance who is foaming at the mouth about bitcoin, its potential and the staggering returns they have earned as a cryptocurrency investor. The "blockchain" behind Bitcoin is now on the lips of every investor, start-up and often politician. The blockchain technology is being hailed as the biggest technological revolution since the internet. It is said to change everything and at the same time wipe trillions of euros and dollars of wealth from the world.
In short, blockchain is a technology that enables a decentralised and transparent database that can be maintained by anyone without the knowledge of the other party, without the need for third-party "intermediary" verification measures. However, it is not just a technology. Blockchain is based on the idea that certain institutional power structures, especially in the financial industry and also in bureaucracies, are not only useless intermediaries, but also violate the rights of individuals. The ideology is strongly rooted in the "cypherpunk" movement of the 1990s, whose views could be summarised as follows. Privacy cannot be assumed to be given because it would be against the interests of governments, corporations and other faceless organisations. Therefore, privacy must be defended by means such as cryptography, anonymous messaging and cryptocurrencies."
Why is it important to understand the social, even political, agenda of blockchain?
Often in the same sentence as blockchain, the disruption and potential of other technologies such as artificial intelligence is repeated. However, when we talk about the scale of the social impact of different technologies, comparing blockchain and AI is like comparing Minna Canthi and A.I. Virta in terms of social impact: one has been involved in creating the significant cultural paradigm around which our society is organised, the other's achievements are indicative of what our society is capable of with technology. Technological advances are raising the standard of living of the members of our society and helping people to control their own destiny. However, cultural development is what makes us human beings more than just resource-producing machines: it adds meaning to the equation, such as morality or a sense of justice, and helps us to understand our own motivations.
Different motivations and criteria for blockchain and AI. The use of AI in businesses and other societal activities is self-evident: it increases the efficiency of people, businesses and governments, disrupts industries and prevailing practices, enables new innovations and frees up human capital for more productive use. Even if the solutions enabled by blockchain are more efficient and self-evident for both individuals and society, their widespread adoption and displacement of existing structures will ultimately depend on citizens' trust (or lack thereof) in the prevailing social system. It is therefore a much bigger theoretical change than we have yet been able to imagine.
Tommi Bergström
The author works at Innovestor Ventures, one of Finland's largest venture capital investors.