distributed ledger

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pages: 515 words: 126,820

Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World by Don Tapscott, Alex Tapscott

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Airbnb, altcoin, asset-backed security, autonomous vehicles, barriers to entry, bitcoin, blockchain, Bretton Woods, business process, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, clean water, cloud computing, cognitive dissonance, commoditize, corporate governance, corporate social responsibility, creative destruction, Credit Default Swap, crowdsourcing, cryptocurrency, disintermediation, distributed ledger, Donald Trump, double entry bookkeeping, Edward Snowden, Elon Musk, Erik Brynjolfsson, ethereum blockchain, failed state, fiat currency, financial innovation, Firefox, first square of the chessboard, first square of the chessboard / second half of the chessboard, future of work, Galaxy Zoo, George Gilder, glass ceiling, Google bus, Hernando de Soto, income inequality, informal economy, information asymmetry, intangible asset, interest rate swap, Internet of things, Jeff Bezos, jimmy wales, Kickstarter, knowledge worker, Kodak vs Instagram, Lean Startup, litecoin, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, Marshall McLuhan, means of production, microcredit, mobile money, money market fund, Network effects, new economy, Oculus Rift, off grid, pattern recognition, peer-to-peer, peer-to-peer lending, peer-to-peer model, performance metric, Peter Thiel, planetary scale, Ponzi scheme, prediction markets, price mechanism, Productivity paradox, QR code, quantitative easing, ransomware, Ray Kurzweil, renewable energy credits, rent-seeking, ride hailing / ride sharing, Ronald Coase, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, seigniorage, self-driving car, sharing economy, Silicon Valley, Skype, smart contracts, smart grid, social graph, social software, Stephen Hawking, Steve Jobs, Steve Wozniak, Stewart Brand, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, The Wisdom of Crowds, transaction costs, Turing complete, Turing test, Uber and Lyft, unbanked and underbanked, underbanked, unorthodox policies, wealth creators, X Prize, Y2K, Zipcar

Each block must refer to the preceding block to be valid. This structure permanently time-stamps and stores exchanges of value, preventing anyone from altering the ledger. If you wanted to steal a bitcoin, you’d have to rewrite the coin’s entire history on the blockchain in broad daylight. That’s practically impossible. So the blockchain is a distributed ledger representing a network consensus of every transaction that has ever occurred. Like the World Wide Web of information, it’s the World Wide Ledger of value—a distributed ledger that everyone can download and run on their personal computer. Some scholars have argued that the invention of double-entry bookkeeping enabled the rise of capitalism and the nation-state. This new digital ledger of economic transactions can be programmed to record virtually everything of value and importance to humankind: birth and death certificates, marriage licenses, deeds and titles of ownership, educational degrees, financial accounts, medical procedures, insurance claims, votes, provenance of food, and anything else that can be expressed in code.

Peter Todd, “Re: [Bitcoin-development] Fwd: Block Size Increase Requirements,” The Mail Archive, June 1, 2015; www.mail-archive.com/, http://tinyurl.com/pk4ordw, accessed August 26, 2015. 44. Satoshi Nakamoto, “Re: Bitcoin P2P E-cash Paper,” Mailing List, Cryptography, Metzger, Dowdeswell & Co. LLC, November 11, 2008. Web. July 13, 2015, www.metzdowd.com/mailman/listinfo/cryptography. 45. Pascal Bouvier, “Distributed Ledgers Part I: Bitcoin Is Dead,” FiniCulture blog, August 4, 2015; http://finiculture.com/distributed-ledgers-part-i-bitcoin-is-dead/, accessed August 28, 2015. 46. Western Union, “Company Facts,” Western Union, Western Union Holdings, Inc., December 31, 2014. Web. January 13, 2016; http://corporate.westernunion.com/Corporate_Fact_Sheet.html. 47. Interview with Gavin Andresen, June 8, 2015. 48. Ibid. 49. Interview with Austin Hill, July 22, 2015. 50.

This has never happened before—trusted transactions directly between two or more parties, authenticated by mass collaboration and powered by collective self-interests, rather than by large corporations motivated by profit. It may not be the Almighty, but a trustworthy global platform for our transactions is something very big. We’re calling it the Trust Protocol. This protocol is the foundation of a growing number of global distributed ledgers called blockchains—of which the bitcoin blockchain is the largest. While the technology is complicated and the word blockchain isn’t exactly sonorous, the main idea is simple. Blockchains enable us to send money directly and safely from me to you, without going through a bank, a credit card company, or PayPal. Rather than the Internet of Information, it’s the Internet of Value or of Money.


pages: 161 words: 44,488

The Business Blockchain: Promise, Practice, and Application of the Next Internet Technology by William Mougayar

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Airbnb, airport security, Albert Einstein, altcoin, Amazon Web Services, bitcoin, Black Swan, blockchain, business process, centralized clearinghouse, Clayton Christensen, cloud computing, cryptocurrency, disintermediation, distributed ledger, Edward Snowden, en.wikipedia.org, ethereum blockchain, fault tolerance, fiat currency, fixed income, global value chain, Innovator's Dilemma, Internet of things, Kevin Kelly, Kickstarter, market clearing, Network effects, new economy, peer-to-peer, peer-to-peer lending, prediction markets, pull request, QR code, ride hailing / ride sharing, Satoshi Nakamoto, sharing economy, smart contracts, social web, software as a service, too big to fail, Turing complete, web application

Programs written in Smart Contract Language get compiled into the Virtual Machine, and to create the contracts you send the transaction containing your code. Historical Record Transactions are actually recorded in sequential data blocks (hence the word blockchain), so there is a historical, append-only log of these transactions that is continuously maintained and updated. A fallacy is that the blockchain is a distributed ledger. In the technical sense, it is not, but it acts as one, because the collection of transactions on blocks is equivalent to a distributed ledger. However, you can build immutable distributed ledger applications based on the historical records that the blockchain provides. State Balances Bitcoin was not designed around accounts, although accounts are a more common way to think about the transactions that are taking place, because we are used to looking at our banking transactions as such.

With Satoshi’s abstract still in your mind, let us dive deeper with three different but complementary definitions of the blockchain: a technical, business, and legal one. Technically, the blockchain is a back-end database that maintains a distributed ledger that can be inspected openly. Business-wise, the blockchain is an exchange network for moving transactions, value, assets between peers, without the assistance of intermediaries. Legally speaking, the blockchain validates transactions, replacing previously trusted entities. TECHNICAL Back-end database that maintains a distributed ledger, openly. BUSINESS Exchange network for moving value between peers. LEGAL A transaction validation mechanism, not requiring intermediary assistance. Blockchain Capabilities = Technical + Business + Legal. THE WEB, ALL OVER AGAIN The past is not an accurate compass to the future, but understanding where we came from helps us gain an enlightened perspective and a better context for where we are going.

We could think of the traditional holders of central trust as today's guilds, and we could question why they should continue holding that trust, if technology (the blockchain) performed that function as well or even better. Blockchains liberate the trust function from outside existing boundaries, in the same way as medieval institutions were forced to cede control of printing. It is deceptive to view the blockchain primarily as a distributed ledger, because it represents only one of its many dimensions. It's like describing the Internet as a network only, or as just a publishing platform. These are necessary but not sufficient conditions or properties; blockchains are also greater than the sum of their parts. Blockchain proponents believe that trust should be free, and not in the hands of central forces that tax it, or control it in one form or another (e.g., fees, access rights, or permissions).


The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory by Kariappa Bheemaiah

accounting loophole / creative accounting, Ada Lovelace, Airbnb, algorithmic trading, asset allocation, autonomous vehicles, balance sheet recession, bank run, banks create money, Basel III, basic income, Ben Bernanke: helicopter money, bitcoin, blockchain, Bretton Woods, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, cashless society, cellular automata, central bank independence, Claude Shannon: information theory, cloud computing, cognitive dissonance, collateralized debt obligation, commoditize, complexity theory, constrained optimization, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crowdsourcing, cryptocurrency, David Graeber, deskilling, Diane Coyle, discrete time, distributed ledger, diversification, double entry bookkeeping, ethereum blockchain, fiat currency, financial innovation, financial intermediation, Flash crash, floating exchange rates, Fractional reserve banking, full employment, George Akerlof, illegal immigration, income inequality, income per capita, inflation targeting, information asymmetry, interest rate derivative, inventory management, invisible hand, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kevin Kelly, knowledge economy, labour market flexibility, large denomination, liquidity trap, London Whale, low skilled workers, M-Pesa, Marc Andreessen, market bubble, market fundamentalism, Mexican peso crisis / tequila crisis, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, natural language processing, Network effects, new economy, Nikolai Kondratiev, offshore financial centre, packet switching, Pareto efficiency, pattern recognition, peer-to-peer lending, Ponzi scheme, precariat, pre–internet, price mechanism, price stability, private sector deleveraging, profit maximization, QR code, quantitative easing, quantitative trading / quantitative finance, Ray Kurzweil, Real Time Gross Settlement, rent control, rent-seeking, Satoshi Nakamoto, Satyajit Das, savings glut, seigniorage, Silicon Valley, Skype, smart contracts, software as a service, software is eating the world, speech recognition, statistical model, Stephen Hawking, supply-chain management, technology bubble, The Chicago School, The Future of Employment, The Great Moderation, the market place, The Nature of the Firm, the payments system, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, trade liberalization, transaction costs, Turing machine, Turing test, universal basic income, Von Neumann architecture, Washington Consensus

The R3 Consortium is a partnership with over 50 of the world's leading financial institutions (including all the TBTF banks) who are working together, and independently, to create “distributed ledger technologies” for the modern financial market. Banks have realized that if they are to gain the benefits of this technology, then it is imperative that common standards and shared platforms be established. Corda is the underlying distributed ledger software which functions as a universal platform. It is important to state the distinction between the term “Distributed Ledger Technology (DLT)” and Blockchain. Distributed ledgers and cryptocurrency systems are different in the way transactions are validated: While Bitcoin uses pseudonymous and anonymous nodes to validate transactions, distributed ledgers require legal identities (permissioned nodes) to validate transactions (Swanson, 2015).

This aspect of regulation in a digital environment was admirably and succinctly analyzed in Chapter 3 of the UK Government report, “Distributed ledger technology: beyond block chain” (2016), where it states, “One fundamental difference between legal code and technical code is the mechanism by which each influences activity. Legal code is “extrinsic”: the rules can be broken, but consequences flow from that breach to ensure compliance. Technical code, in contrast, is “intrinsic”: if its rules are broken then an error is returned and no activity occurs, so compliance is ensured through the operation of the code itself. Another characteristic of software is that a machine will rigidly follow the rules even where that compliance produces unforeseen or undesirable outcomes. This leads to some striking differences in the operation of distributed ledger systems compared with the current financial system.”

BIEN. (2016, September). About Basic Income. Retrieved from Basic Income Earth Network: http://basicincome.org/ Bregman, R. (2016). Utopia for Realists: The Case for a Universal Basic Income, Open Borders, and a 15- hour Workweek . Amazon Digital Services LLC. Brown, R. G. (2016, April 05). Introducing R3 Corda™: A distributed ledger designed for financial services. Retrieved from Thoughts on the future of finance: https://gendal. me/2016/04/05/introducing-r3-corda-a-distributed-ledger-designed-forfinancial-services/ Busby, M. J. (2016, August 6). Chatbots will not replace 5 million jobs, as the data suggests. Retrieved from Venture Beat: http://venturebeat.com/2016/08/03/chatbotswill-not-replace-5-million-jobs-as-the-data-suggests/ CB Insights. (2016, September 7). 51 Corporate Chatbots Across Industries Including Travel, Media, Retail, And Insurance.


pages: 410 words: 119,823

Radical Technologies: The Design of Everyday Life by Adam Greenfield

3D printing, Airbnb, augmented reality, autonomous vehicles, bank run, barriers to entry, basic income, bitcoin, blockchain, business intelligence, business process, call centre, cellular automata, centralized clearinghouse, centre right, Chuck Templeton: OpenTable, cloud computing, collective bargaining, combinatorial explosion, Computer Numeric Control, computer vision, Conway's Game of Life, cryptocurrency, David Graeber, dematerialisation, digital map, distributed ledger, drone strike, Elon Musk, ethereum blockchain, facts on the ground, fiat currency, global supply chain, global village, Google Glasses, IBM and the Holocaust, industrial robot, informal economy, information retrieval, Internet of things, James Watt: steam engine, Jane Jacobs, Jeff Bezos, job automation, John Conway, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Kevin Kelly, Kickstarter, late capitalism, license plate recognition, lifelogging, M-Pesa, Mark Zuckerberg, means of production, megacity, megastructure, minimum viable product, money: store of value / unit of account / medium of exchange, natural language processing, Network effects, New Urbanism, Occupy movement, Oculus Rift, Pareto efficiency, pattern recognition, Pearl River Delta, performance metric, Peter Eisenman, Peter Thiel, planetary scale, Ponzi scheme, post scarcity, RAND corporation, recommendation engine, RFID, rolodex, Satoshi Nakamoto, self-driving car, sentiment analysis, shareholder value, sharing economy, Silicon Valley, smart cities, smart contracts, sorting algorithm, special economic zone, speech recognition, stakhanovite, statistical model, stem cell, technoutopianism, Tesla Model S, the built environment, The Death and Life of Great American Cities, The Future of Employment, transaction costs, Uber for X, universal basic income, urban planning, urban sprawl, Whole Earth Review, WikiLeaks, women in the workforce

, London: Verso, 1994. 4.Nathaniel Popper, “Ethereum, a Virtual Currency, Enables Transactions That Rival Bitcoin’s,” New York Times, March 27, 2016. 5.Nick Szabo, “Smart Contracts,” 1994, szabo.best.vwh.net/smart.contracts.html. 6.Ronald Bailey, “Live from Extro-5,” Reason, June 20, 2001. At the same conference, Szabo also apparently presented “an ambitious project in which all property is embedded with information about who owns it”; see the discussion of smart property that follows. 7.See the comments of Vili Lehdonvirta and Robleh Ali, Government Office for Science. “Distributed Ledger Technology: Beyond blockchain,” 2016, p. 41, gov.uk/government/uploads/system/uploads/attachment_data/file/492972/gs-16-1-distributed-ledger-technology.pdf. 8.Michael Del Castillo, “Prenup Built in Ethereum Smart Contract Rethinks Marriage Obligations,” CoinDesk, June 1, 2016. 9.Chrystia Freeland, “When Labor Is Flexible, And Paid Less,” International Herald-Tribune, June 28, 2013. 10.Stafford Beer, “What Is Cybernetics?”, Kybernetes, Volume 31, Issue 2, 2002. 11.Kickstarter exacts a 5 percent commission on successfully funded projects, kickstarter.com/help/faq/kickstarter+basics. 12.Graham Rapier, “Yellen Reportedly Urges Central Banks to Study Blockchain, Bitcoin,” American Banker, June 6, 2016; see also Nathaniel Popper, “Central Banks Consider Bitcoin’s Technology, if Not Bitcoin,” New York Times, October 11, 2016. 13.Pete Rizzo, “Bank of Canada Demos Blockchain-Based Digital Dollar,” CoinDesk, June 16, 2016. 14.See, e.g., a proposal for London’s budget to be executed via blockchain.

., “Computerised Physician Order Entry-Related Medication Errors: Analysis of Reported Errors and Vulnerability Testing of Current Systems,” BMJ Quality & Safety, April 2015; Raymond Bonner, “ ‘No-Fly List’ Riddled with Errors, Impossible to Get Off Of,” Informed Comment, December 16, 2015. 17.Michael McFarland, “The Human Cost of Computer Errors,” Markkula Center for Applied Ethics blog, June 1, 2012, scu.edu/ethics/focus-areas/internet-ethics/resources/the-human-cost-of-computer-errors; Wayne W Eckerson, “Data Quality and the Bottom Line,” The Data Warehousing Institute, 2002. 18.Antony Lewis, “Confused by Blockchain? Separating Revolution from Evolution,” CoinDesk, May 17, 2016; see also Chris Skinner, “Will the Blockchain Replace SWIFT?,” American Banker, March 8, 2016. 19.Simon Taylor, “Chapter 1: Vision,” in Government Office for Science, “Distributed Ledger Technology: Beyond blockchain,” 2016, pp. 20–30, gov.uk/government/uploads/system/uploads/attachment_data/file/492972/gs-16-1-distributed-ledger-technology.pdf. 20.Vitalik Buterin, “Bitcoin Multisig Wallet: The Future of Bitcoin,” Bitcoin Magazine, March 13, 2014. 21.Slock.it UG, “DAO,” undated, slock.it/dao.html. 22.At least, they intend to do so. The developers of the Eris DAO platform appear to regard this process as a mere formality, and therefore “incorporation and other legal matters will be dealt with at a later date”: Dennis McKinnon, Casey Kuhlman, Preston Byrne, “Eris—The Dawn of Distribute Autonomous Organizations and the Future of Governance,” hplusmagazine.com, June 17, 2014. 23.Aaron Wright and Primavera di Filippi.

Its appearance in the world economy gives disproportionately great power to those individuals and institutions that understand how it does what it does, and are best able to operationalize that understanding. At present, only a very tiny number of people truly grasp how Bitcoin and its underlying technologies work to create and mediate the transmission of value. If cryptocurrencies, blockchains and distributed ledgers1 more generally are to be the crux of the networked, postnational global economy of the remaining century, though, it’s vitally important that we, all of us, grasp at least the basic outlines of how they work and what it is they propose to achieve. At its core, Bitcoin is a digital medium of exchange that has been designed to act like cash in all the ways we might appreciate, and none of the ways we don’t.


pages: 472 words: 117,093

Machine, Platform, Crowd: Harnessing Our Digital Future by Andrew McAfee, Erik Brynjolfsson

3D printing, additive manufacturing, AI winter, Airbnb, airline deregulation, airport security, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, artificial general intelligence, augmented reality, autonomous vehicles, backtesting, barriers to entry, bitcoin, blockchain, book scanning, British Empire, business process, carbon footprint, Cass Sunstein, centralized clearinghouse, Chris Urmson, cloud computing, cognitive bias, commoditize, complexity theory, computer age, creative destruction, crony capitalism, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, Dean Kamen, discovery of DNA, disintermediation, distributed ledger, double helix, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, ethereum blockchain, everywhere but in the productivity statistics, family office, fiat currency, financial innovation, George Akerlof, global supply chain, Hernando de Soto, hive mind, information asymmetry, Internet of things, inventory management, iterative process, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, joint-stock company, Joseph Schumpeter, Kickstarter, law of one price, Lyft, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, Marc Andreessen, Mark Zuckerberg, meta analysis, meta-analysis, moral hazard, multi-sided market, Myron Scholes, natural language processing, Network effects, new economy, Norbert Wiener, Oculus Rift, PageRank, pattern recognition, peer-to-peer lending, performance metric, Plutocrats, plutocrats, precision agriculture, prediction markets, pre–internet, price stability, principal–agent problem, Ray Kurzweil, Renaissance Technologies, Richard Stallman, ride hailing / ride sharing, risk tolerance, Ronald Coase, Satoshi Nakamoto, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Skype, slashdot, smart contracts, Snapchat, speech recognition, statistical model, Steve Ballmer, Steve Jobs, Steven Pinker, supply-chain management, TaskRabbit, Ted Nelson, The Market for Lemons, The Nature of the Firm, Thomas L Friedman, too big to fail, transaction costs, transportation-network company, traveling salesman, two-sided market, Uber and Lyft, Uber for X, Watson beat the top human players on Jeopardy!, winner-take-all economy, yield management, zero day

Almost twenty years later, the world of the blockchain appeared and seemed to provide exactly the structure and world that Szabo was describing. Entrepreneurs, programmers, and visionaries took notice, and efforts to combine distributed ledgers and smart contracts blossomed. By the end of 2016, the best known of these was probably Ethereum, which described itself as “a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.” A number of ambitious efforts were launched on the Ethereum platform, one of which we’ll encounter in the next chapter. Toppling the Stacks: The Crypto Assault on the Core At least some efforts involving cryptocurrencies, distributed ledgers, and smart contracts seemed to be motivated by a desire to decentralize activities and information that had previously been concentrated, and to explicitly favor the crowd over the core.

But the value of the Bitcoin, as expressed by its exchange rate against currencies like the dollar, fluctuated wildly, rising to a high of over $1,100 in November 2013 before plummeting 77% to less than $250 in January 2015 and then recovering to more than $830 two years later. This volatility made the digital currency interesting for risk-tolerant investors†† but unsuitable as a mainstream means of exchange or store of value. While the debate about Bitcoin’s ability to ever be a true currency was unfolding, a small group of people began to make a different point: that the truly valuable innovation was not the new digital money, but instead the distributed ledger that it rested on. It was the blockchain that really mattered, not Bitcoins. Bitcoin’s tumultuous history was evidence that the blockchain could actually work. For years, it functioned as designed: as a completely decentralized, undirected, apparently immutable record of transactions.‡‡ The transactions it was originally intended to record were limited to the mining and exchange of Bitcoins, but why stop there?

It is expected that moving elements of the process onto the blockchain can reduce costs for homeowners and other users, while also reducing possibilities for corruption (since the land records, like everything else on the blockchain, will be unalterable). Why Not Get Smart about Contracts? As it became apparent that the blockchain could be used to record all kinds of transactions, not just those related to Bitcoins, it also became clear to some that a distributed ledger was the ideal home for digital “smart contracts.” This was a phrase coined in the mid-1990s by Nick Szabo, a computer scientist and legal scholar.## Szabo observed that business contracts, one of the foundations of modern capitalist economies, are similar to computer programs in many ways. Both involve clear definitions (in programs, of variables; in contracts, of the parties involved and their roles), and both specify what will happen under different conditions.


pages: 275 words: 84,980

Before Babylon, Beyond Bitcoin: From Money That We Understand to Money That Understands Us (Perspectives) by David Birch

agricultural Revolution, Airbnb, bank run, banks create money, bitcoin, blockchain, Bretton Woods, British Empire, Broken windows theory, Burning Man, capital controls, cashless society, Clayton Christensen, clockwork universe, creative destruction, credit crunch, cross-subsidies, crowdsourcing, cryptocurrency, David Graeber, dematerialisation, Diane Coyle, distributed ledger, double entry bookkeeping, ethereum blockchain, facts on the ground, fault tolerance, fiat currency, financial exclusion, financial innovation, financial intermediation, floating exchange rates, Fractional reserve banking, index card, informal economy, Internet of things, invention of the printing press, invention of the telegraph, invention of the telephone, invisible hand, Irish bank strikes, Isaac Newton, Jane Jacobs, Kenneth Rogoff, knowledge economy, Kuwabatake Sanjuro: assassination market, large denomination, M-Pesa, market clearing, market fundamentalism, Marshall McLuhan, Martin Wolf, mobile money, money: store of value / unit of account / medium of exchange, new economy, Northern Rock, Pingit, prediction markets, price stability, QR code, quantitative easing, railway mania, Ralph Waldo Emerson, Real Time Gross Settlement, reserve currency, Satoshi Nakamoto, seigniorage, Silicon Valley, smart contracts, social graph, special drawing rights, technoutopianism, the payments system, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, tulip mania, wage slave, Washington Consensus, wikimedia commons

Number 1 was the printing press, but what caught my attention was the appearance of paper money at number 42. It made me think that in the great sweep of things the replacement of stuff of some kind by records of some kind goes back a lot further – to the grain banks of ancient Babylonia and to the marks made on cuneiform clay tablets – and extends right up to the present day, where there are fascinating discussions going on around the use of cryptography to manage distributed ledgers. Was paper money as big a technological breakthrough as the clay tablet was to ancient Babylon or the blockchain may be to the pervasive Internet? The interaction between money and the technology of money is more complex and less well understood than you might think, given just how long both have been around. As Jevons wrote, back in Victorian times (Jevons 1884): It is a misfortune of what may be called the science of monetary technology, that its study is almost of necessity confined to the few officers employed in government mints.

, they were easy to store and transport, and they were easily understood by those who couldn’t read (i.e. almost everyone). As a new technology, however, they soon began to exhibit some unforeseen characteristics (in the context of their record-keeping function). During the extended period of use of any technology, creative people come along and find new ways to use the technology in different times and in different cultural contexts. Tally sticks were a form of distributed ledger to record debt, and were soon being used as money. Tally-ho! By the time of the reign of Henry II (who died in France in 1189) the exchequer was already a sophisticated and organized department of the king’s court, with an elaborate staff of officers. The use of tallies to enable this operation had an interesting consequence. Since (as is generally the case) the king couldn’t be bothered to wait until taxes fell due, and could not borrow money at interest, he would sell the tallies at a discount.

Someone in (say) Bristol who was holding a tally for taxes due in (say) York would have to travel to collect their due payment or find someone else who would, for an appropriate discount, buy the tally. Thus, a market for tallies grew, arbitrating various temporal and spatial preferences by discounting. It is known from recorded instances that officials working in the exchequer helped this market to operate smoothly (Davies 1995b). The distributed ledger technology of the tally had been used to convert a means for deferred payment into a store of value and then into a means of exchange, and the sticks remained in widespread use for hundreds of years. The Bank of England, being a sensible and conservative institution naturally suspicious of new technologies, continued to use wooden tally sticks until 1826: some 500 years after the invention of double-entry bookkeeping and 400 years after Johannes Gutenberg’s invention of the printing press.


pages: 361 words: 97,787

The Curse of Cash by Kenneth S Rogoff

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Andrei Shleifer, Asian financial crisis, bank run, Ben Bernanke: helicopter money, Berlin Wall, bitcoin, blockchain, Bretton Woods, capital controls, Carmen Reinhart, cashless society, central bank independence, cryptocurrency, debt deflation, distributed ledger, Edward Snowden, ethereum blockchain, eurozone crisis, Fall of the Berlin Wall, fiat currency, financial exclusion, financial intermediation, financial repression, forward guidance, frictionless, full employment, George Akerlof, German hyperinflation, illegal immigration, inflation targeting, informal economy, interest rate swap, Isaac Newton, Johann Wolfgang von Goethe, Kenneth Rogoff, labor-force participation, large denomination, liquidity trap, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, moveable type in China, New Economic Geography, offshore financial centre, oil shock, open economy, payday loans, price stability, purchasing power parity, quantitative easing, RAND corporation, RFID, savings glut, secular stagnation, seigniorage, The Great Moderation, the payments system, transaction costs, unbanked and underbanked, unconventional monetary instruments, underbanked, unorthodox policies, Y2K, yield curve

A simple but important point is that, ironically, the end objective of many cybertheft schemes often involves cash, typically withdrawn from an ATM.15 This is sometimes how criminals ultimately remove the funds they have transferred to bank accounts they control, possibly withdrawing currency via a network of people to avoid being conspicuous. Because the technology is evolving so rapidly, I am hesitant to go into much more detail, beyond saying that phasing out paper currency does not really move the needle much on society’s vulnerability to cybercrime. Some of the present-day obstacles to improving security are really more political than economic. Some innovations in security, such as the potentially disruptive distributed-ledger technology embodied in cryptocurrencies like Bitcoin or Ethereum, may eventually lead to major improvements in financial security, at least at the core of the payment system, as discussed further in chapter 14. It is particularly hard to see in any of these arguments why large-denomination notes are important. Probably they would be looked on askance after a power outage, earthquake, or other kind of catastrophe.

As things currently stand, the Federal Reserve does not directly weigh the welfare of other countries when determining its policy; they count only to the extent that any adverse effects might rebound back on the United States. This is hardly a desirable state of global governance but is not an issue I aim to tackle here. CHAPTER 14 Digital Currencies and Gold When I suggest to people that there might be benefits to phasing out paper currency, they almost invariably assume I am advocating a cryptocurrency like Bitcoin and are a bit disappointed to find out otherwise.1 No doubt anyone who looks at distributed-ledger technologies has to be excited about their potential applications in financial services and record keeping in general. For the foreseeable future, however, the best system is one in which a government-issued currency is the unit of account, though of course it will eventually morph into a fully electronic one. I appreciate that many leaders in the alternative payment space hold the libertarian view that new web-based transaction technologies can free people from the tyranny of government currency and regulation.

Plenty of other targets in the transaction ecosystem in theory could be overtaken by digital currencies, even after adjusting to regulation. The huge fees collected by credit card agencies, wire services, and other extant electronic transaction technologies make these media extremely vulnerable to disruptive innovators. Already, digital currencies are far cheaper for transmitting money internationally than wire services, where the charges can often run as much as 10–15% of the amount transmitted. And some applications of distributed-ledger technology offer the promise of cutting out intermediaries in transactions between, say, two banks. This would substantially reduce costs, particularly in international transactions. The approach can also be used to save on legal contracting costs. Some of Bitcoin’s competitors, notably the newer Ethereum platform, aim to offer the possibility of creating secure exchanges for transactions of almost any type.


pages: 296 words: 86,610

The Bitcoin Guidebook: How to Obtain, Invest, and Spend the World's First Decentralized Cryptocurrency by Ian Demartino

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3D printing, AltaVista, altcoin, bitcoin, blockchain, buy low sell high, capital controls, cloud computing, corporate governance, crowdsourcing, cryptocurrency, distributed ledger, Edward Snowden, Elon Musk, ethereum blockchain, fiat currency, Firefox, forensic accounting, global village, GnuPG, Google Earth, Haight Ashbury, Jacob Appelbaum, Kevin Kelly, Kickstarter, litecoin, M-Pesa, Marc Andreessen, Marshall McLuhan, Oculus Rift, peer-to-peer, peer-to-peer lending, Ponzi scheme, prediction markets, QR code, ransomware, Satoshi Nakamoto, self-driving car, Skype, smart contracts, Steven Levy, the medium is the message, underbanked, WikiLeaks, Zimmermann PGP

Any person can digitally “hand” someone a bitcoin, multiple bitcoins, or a fraction of bitcoin, across the world or in the same room. Like handing someone cash, and unlike older digital financial systems, the money doesn’t have to go through an intermediary like a bank or another company. The advantages of using Bitcoin, which I will get to later, are what gives it its value. Bitcoin is also a distributed ledger, i.e., a record of every transaction and every Bitcoin wallet’s balance (you can think of a wallet as something akin to an account for now). This ledger is also called a blockchain. Every wallet, rather than being stored in a bank’s database, exists on this ledger; each wallet has its own private key and public key. The public key is also called the Bitcoin address. It is between 25 and 36 alphanumeric characters and begins with either a 1 or 3.

I won’t even make the argument that cash has been used for criminal activities far more often and for far longer than digital currencies, because the truth is that digital currencies are better suited for certain criminal activities than even cash is. Bitcoin is a useful tool and people will find uses for it, both good and bad. I suspect criminal activities surrounding digital currencies will only get more advanced in the future, but at the same time, so will legitimate investments and innovations. Bitcoin is many things. It is an online currency, a distributed ledger, and a decentralized network. And yet it may also become the fulfillment of the predictions, desires, and even fears of the early pioneers of the Internet. 1 “Statistics and Facts about Online Shopping.” Statista. June 2014. Accessed May 19, 2015. http://www.statista.com/topics/2477/online-shopping-behavior/. 2 Lewis, Peter H. “Attention Shoppers: Internet Is Open.” Editorial. The New York Times.

Some currencies failed because the company issuing them merely acted as money transactors themselves, adding an unnecessary middleman instead of eliminating one. Others failed because the issuer abused their power and scammed those who had bought in. Yet others ran afoul of government regulations.6 These issues are avoided with decentralization. When Satoshi Nakamoto invented the blockchain by combining the distributed ledger and proof-of-work concepts, he fulfilled the long-held vision of a workable, distributed, decentralized currency for the Internet. With it, anyone can transfer virtually any amount for a few cents or less. The blockchain tracks every transaction and its distributed nature ensures that no government agency can shut it down. The details of how this works will be covered in another chapter but the first use case of Bitcoin and the blockchain is the ability to transfer value on the Internet as easily as sending an email and almost as cheaply.


Martin Kleppmann-Designing Data-Intensive Applications. The Big Ideas Behind Reliable, Scalable and Maintainable Systems-O’Reilly (2017) by Unknown

active measures, Amazon Web Services, bitcoin, blockchain, business intelligence, business process, c2.com, cloud computing, collaborative editing, commoditize, conceptual framework, cryptocurrency, database schema, DevOps, distributed ledger, Donald Knuth, Edward Snowden, ethereum blockchain, fault tolerance, finite state, Flash crash, full text search, general-purpose programming language, informal economy, information retrieval, Internet of things, iterative process, John von Neumann, loose coupling, Marc Andreessen, natural language processing, Network effects, packet switching, peer-to-peer, performance metric, place-making, premature optimization, recommendation engine, Richard Feynman, Richard Feynman, self-driving car, semantic web, Shoshana Zuboff, social graph, social web, software as a service, software is eating the world, sorting algorithm, source of truth, SPARQL, speech recognition, statistical model, web application, WebSocket, wikimedia commons

A transaction log can be made tamper-proof by periodically signing it with a hardware security module, but that does not guarantee that the right transactions went into the log in the first place. It would be interesting to use cryptographic tools to prove the integrity of a system in a way that is robust to a wide range of hardware and software issues, and even poten‐ tially malicious actions. Cryptocurrencies, blockchains, and distributed ledger tech‐ nologies such as Bitcoin, Ethereum, Ripple, Stellar, and various others [71, 72, 73] have sprung up to explore this area. I am not qualified to comment on the merits of these technologies as currencies or mechanisms for agreeing contracts. However, from a data systems point of view they contain some interesting ideas. Essentially, they are distributed databases, with a data model and transaction mechanism, in which different replicas can be hosted by mutually untrusting organizations.

Cryptographic auditing and integrity checking often relies on Merkle trees [74], which are trees of hashes that can be used to efficiently prove that a record appears in some dataset (and a few other things). Outside of the hype of cryptocurrencies, certif‐ icate transparency is a security technology that relies on Merkle trees to check the val‐ idity of TLS/SSL certificates [75, 76]. 532 | Chapter 12: The Future of Data Systems I could imagine integrity-checking and auditing algorithms, like those of certificate transparency and distributed ledgers, becoming more widely used in data systems in general. Some work will be needed to make them equally scalable as systems without cryptographic auditing, and to keep the performance penalty as low as possible. But I think this is an interesting area to watch in the future. Doing the Right Thing In the final section of this book, I would like to take a step back. Throughout this book we have examined a wide range of different architectures for data systems, eval‐ uated their pros and cons, and explored techniques for building reliable, scalable, and maintainable applications.

Gray and Catharine van Ingen: “Empirical Measurements of Disk Failure Rates and Error Rates,” Microsoft Research, MSR-TR-2005-166, December 2005. [65] Annamalai Gurusami and Daniel Price: “Bug #73170: Duplicates in Unique Sec‐ ondary Index Because of Fix of Bug#68021,” bugs.mysql.com, July 2014. [66] Gary Fredericks: “Postgres Serializability Bug,” github.com, September 2015. [67] Xiao Chen: “HDFS DataNode Scanners and Disk Checker Explained,” blog.clou‐ dera.com, December 20, 2016. [68] Jay Kreps: “Getting Real About Distributed System Reliability,” blog.empathy‐ box.com, March 19, 2012. [69] Martin Fowler: “The LMAX Architecture,” martinfowler.com, July 12, 2011. [70] Sam Stokes: “Move Fast with Confidence,” blog.samstokes.co.uk, July 11, 2016. [71] “Sawtooth Lake Documentation,” Intel Corporation, intelledger.github.io, 2016. [72] Richard Gendal Brown: “Introducing R3 Corda™: A Distributed Ledger Designed for Financial Services,” gendal.me, April 5, 2016. [73] Trent McConaghy, Rodolphe Marques, Andreas Müller, et al.: “BigchainDB: A Scalable Blockchain Database,” bigchaindb.com, June 8, 2016. [74] Ralph C. Merkle: “A Digital Signature Based on a Conventional Encryption Function,” at CRYPTO ’87, August 1987. doi:10.1007/3-540-48184-2_32 [75] Ben Laurie: “Certificate Transparency,” ACM Queue, volume 12, number 8, pages 10-19, August 2014. doi:10.1145/2668152.2668154 Summary | 549 [76] Mark D.


pages: 375 words: 88,306

The Sharing Economy: The End of Employment and the Rise of Crowd-Based Capitalism by Arun Sundararajan

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3D printing, additive manufacturing, Airbnb, Amazon Mechanical Turk, autonomous vehicles, barriers to entry, basic income, bitcoin, blockchain, Burning Man, call centre, collaborative consumption, collaborative economy, collective bargaining, commoditize, corporate social responsibility, cryptocurrency, David Graeber, distributed ledger, employer provided health coverage, Erik Brynjolfsson, ethereum blockchain, Frank Levy and Richard Murnane: The New Division of Labor, future of work, George Akerlof, gig economy, housing crisis, Howard Rheingold, information asymmetry, Internet of things, inventory management, invisible hand, job automation, job-hopping, Kickstarter, knowledge worker, Kula ring, Lyft, Marc Andreessen, megacity, minimum wage unemployment, moral hazard, moral panic, Network effects, new economy, Oculus Rift, pattern recognition, peer-to-peer, peer-to-peer lending, peer-to-peer model, peer-to-peer rental, profit motive, purchasing power parity, race to the bottom, recommendation engine, regulatory arbitrage, rent control, Richard Florida, ride hailing / ride sharing, Robert Gordon, Ronald Coase, Second Machine Age, self-driving car, sharing economy, Silicon Valley, smart contracts, Snapchat, social software, supply-chain management, TaskRabbit, The Nature of the Firm, total factor productivity, transaction costs, transportation-network company, two-sided market, Uber and Lyft, Uber for X, universal basic income, Zipcar

Historically, protocols have emerged from either research projects or from individuals / small groups simply throwing something out that sticks. In the debate about bitcoin it is critical to understand that bitcoin has the potential to be such a protocol that enables a lot of new innovation to take place.9 Although the exact details of how Bitcoin works are a little more complicated than my short description in this section, a few key ideas come across: digital signatures that facilitate identity; the distributed ledger (the blockchain) that is stored on every client’s device; the crowd collectively clearing each transaction; the need to make clearing transactions challenging to avoid a potential takeover of the blockchain; and the need for an incentive (some equivalent of money, typically called the “coin” that is generated from within the system) to get the crowd interested in performing the challenging work that accompanies verifying transactions.

As the venture capitalist Chris Dixon wrote on his blog in 2014, Bitcoin makes activities like international microfinance, markets for computing capacity, incentivized social software, and other micropayments possible—not because we haven’t considered the value of these before, but because the transaction costs were too high.16 There are signs that traditional businesses will embrace many of the new capabilities of decentralized peer-to-peer technologies, much like Facebook actively uses BitTorrent within its privately owned server farms. In spring 2015, NASDAQ announced plans to leverage blockchain technology to support the development of a distributed ledger function for securities trading that will provide enhanced integrity, audit capabilities, governance, and transfer of ownership capabilities. The startup R3CEV has assembled a consortium of 25 of the world’s largest banks that are creating a framework for using blockchain technology in world financial markets.17 The startup Provenance provides a blockchain-based authentication service, where, for example, you can credibly establish the provenance of a high-value item by keeping track of and being able to access every trade associated with its ownership.


pages: 504 words: 126,835

The Innovation Illusion: How So Little Is Created by So Many Working So Hard by Fredrik Erixon, Bjorn Weigel

Airbnb, Albert Einstein, asset allocation, autonomous vehicles, barriers to entry, Basel III, Bernie Madoff, bitcoin, Black Swan, blockchain, BRICs, Burning Man, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, Clayton Christensen, Colonization of Mars, commoditize, corporate governance, corporate social responsibility, creative destruction, crony capitalism, dark matter, David Graeber, David Ricardo: comparative advantage, discounted cash flows, distributed ledger, Donald Trump, Elon Musk, Erik Brynjolfsson, fear of failure, first square of the chessboard / second half of the chessboard, Francis Fukuyama: the end of history, George Gilder, global supply chain, global value chain, Google Glasses, Google X / Alphabet X, Gordon Gekko, high net worth, hiring and firing, Hyman Minsky, income inequality, income per capita, index fund, industrial robot, Internet of things, Jeff Bezos, job automation, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, joint-stock company, Joseph Schumpeter, Just-in-time delivery, Kevin Kelly, knowledge economy, labour market flexibility, laissez-faire capitalism, lump of labour, Lyft, manufacturing employment, Mark Zuckerberg, market design, Martin Wolf, mass affluent, means of production, Mont Pelerin Society, Network effects, new economy, offshore financial centre, pensions crisis, Peter Thiel, Potemkin village, price mechanism, principal–agent problem, Productivity paradox, QWERTY keyboard, RAND corporation, Ray Kurzweil, rent-seeking, risk tolerance, risk/return, Robert Gordon, Ronald Coase, Ronald Reagan, savings glut, Second Machine Age, secular stagnation, Silicon Valley, Silicon Valley startup, Skype, sovereign wealth fund, Steve Ballmer, Steve Jobs, Steve Wozniak, technological singularity, telemarketer, The Chicago School, The Future of Employment, The Nature of the Firm, The Wealth of Nations by Adam Smith, too big to fail, total factor productivity, transaction costs, transportation-network company, tulip mania, Tyler Cowen: Great Stagnation, University of East Anglia, unpaid internship, Vanguard fund, Yogi Berra

Asked why, Will Wang Graylin, the CEO of LoopPay, a digital wallet company focusing on the interface between merchants and credit card firms, explained to MIT Technology Review: “Think about the infrastructure and how long it took to create that. It is very difficult to change merchant behavior.”16 No one knows how this market will evolve, but markets, competition, and consumer behavior – not only the technology itself – will determine its future success. The same is true for another promising technology that can be applied to the payments market: blockchain, or mutual distributed ledger technology (like bitcoin). The market clearly sees a big potential in blockchain technology. It could reduce the costs and risks in transactions, and create a far better system for sharing information in financial markets. Some have billed it as a greater technological leap than the internet for capital markets. Perhaps it will be, but the hype around the technology is premature and the expectation of big market changes is an aspiration.

Chance character (i), (ii) Belgium profit margins (i) taxi services and regulation (i) Bell, Alexander Graham (i), (ii) Bell Labs (AT&T) (i) Bellamy, Edward (i) Bellman, Richard (i) benchmarking (i), (ii) benefits, and incomes (i) Benz, Karl (i) Bergman, Ingmar (i) Berkshire Hathaway (i) Berle, Adolf (i) Berra, Yogi (i) Bezos, Jeff (i) Bhide, Amar (i) big firms big firm market dominance (i) and investment allocation for innovation (i) and private standards (i) relative importance of in European countries (i) reputation of (i) see also firm boundaries; firms; multinational (global) companies “big swinging dicks” (i) big-data business models (i) biofuels and EU regulation (i) see also energy sector biotechnological sector, and EU regulation (i) Bismarck, Otto von (i) bitcoin (i) BlackBerry (i) blackboard economics (i) Blackrock (i) blockchain (mutual distributed ledger) technology (i) Blue Ribbon Commission (US) (i) The Blues Brothers (movie) (i) boom and bust cycles (i), (ii), (iii) boomer (or baby boomer) generation (i), (ii), (iii), (iv) Boston Consulting Group index of complicatedness (i) on performance imperatives (i) on working time of managing teams (i) branding (i), (ii) Brazil and BRIC concept (i), (ii) taxi services and regulation (i) BRIC as a Bloody Ridiculous Investment Concept (i) countries (Brazil, India, Russia, and China) (i), (ii) Bridgewater (i) Brin, Sergey (i) Britain see United Kingdom (UK) British managerialism (i) Brockovich, Erin (i) Brookings (i) Brown, Gordon (i) Brynjolfsson, Erik, The Second Machine Age (Brynjolfsson and McAfee) (i), (ii) budget process, and compliance officers (i) Buffett, Warren (i), (ii) bureaucracy and capitalism (i), (ii) and competition (i) and compliance officers (i) and globalization (i), (ii), (iii), (iv) and IBM (i) and index of complicatedness (Boston Consulting Group) (i) and Indian economy (i) and managerialism (i), (ii), (iii) and organizational diversification (i) and principal–agent debate (i) and socialism (i) see also bureaucracy brake; bureaucrats; corporate managerialism; managerialism bureaucracy brake, and regulation (Germany) (i) bureaucrats vs. entrepreneurs (i), (ii) see also bureaucracy; bureaucracy brake Burning Man festival (Nevada) (i) Burns, Scott, The Clash of Generations (Kotlikoff and Burns) (i) business-building skills, vs. financial skills (i) business cycles, and productivity (i) business development, and strategy (i), (ii) business information technology (IT) services (i) business investment and cash hoarding (i) and corporate net lending (i), (ii) declining trend (i) explanations for decline (i) and financial regulation (i), (ii) and gray capitalism (i) investment allocation for innovation and big firms (i) low investment growth vs. fast corporate borrowing growth (i) measuring issues (i) and mergers and acquisitions (i) and policy uncertainty (i), (ii) and shareholders (i), (ii), (iii) UK business investment (i), (ii) US business investment (i), (ii) see also asset managers; investment; R&D business management (i), (ii) see also corporate managerialism business productivity growth (i) Business Week, on Peter Drucker (i) CAC 40 index (France) (i) cadmium (i), (ii) Canada diffusion of innovations (i) GDP figures (i) North American Free Trade Agreement (i) cancer research, and innovation (i), (ii) capital accumulation, and capitalism (i) capital expenditure (capex) (i), (ii), (iii), (iv)n39 capital markets (external) (i), (ii), (iii), (iv), (v) capitalism and agency (i) and asset bubbles (i) and bureaucracy (i), (ii) and capital accumulation (i) “complex by design” capitalism (i) criticism of Western capitalism (i) crony capitalism (i) death of capitalism utopia and socialism (i) decline of Western capitalism (i) and digital age (i) and dissent (i), (ii), (iii) and eccentricity (i), (ii), (iii), (iv), (v) and economic dynamism (i), (ii), (iii) and Enlightenment (i), (ii) and entrepreneurship (i), (ii) financial capitalism (i), (ii), (iii), (iv) free-market capitalism (i) and individual freedom (i), (ii), (iii) and innovation (i), (ii), (iii), (iv), (v) joint-stock capitalism (i), (ii) and labor vs. work (i) vs. the market (i), (ii) Marxist monopolistic theory of (i) “middle-aged” capitalism (i), (ii), (iii) “money manager capitalism” (Hyman Minsky) (i) and organization (i) and planning machines (i) rentier capitalism (i), (ii), (iii), (iv), (v), (vi) and Swedish hybrid economy (i) and technology (i) see also capitalist ownership; corporate managerialism; entrepreneurs; entrepreneurship; the future (and how to prevent it); globalization; gray capitalism; regulation; rich people capitalist ownership and corporate globalism (i) and diversification (i) and gray capitalism: case of Harley-Davidson Motor Company (HD) (i); decline/obituary of capitalist ownership (i); dispersed ownership (i); gray ownership (i), (ii), (iii), (iv), (v), (vi); severing gray capital–corporate ownership link (i) ownership structure reforms (i) and pensions (i) and principal–agent problem (i) and uncertainty (i) car industry car sales and regulation (i) driverless vehicles (i), (ii), (iii), (iv) German car production and value chains (i) lean production (i) US environment-related regulations (i) Carew, Diana G.


pages: 179 words: 43,441

The Fourth Industrial Revolution by Klaus Schwab

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3D printing, additive manufacturing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, barriers to entry, Baxter: Rethink Robotics, bitcoin, blockchain, Buckminster Fuller, call centre, clean water, collaborative consumption, commoditize, conceptual framework, continuous integration, crowdsourcing, disintermediation, distributed ledger, Edward Snowden, Elon Musk, epigenetics, Erik Brynjolfsson, future of work, global value chain, Google Glasses, income inequality, Internet Archive, Internet of things, invention of the steam engine, job automation, job satisfaction, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, life extension, Lyft, mass immigration, megacity, meta analysis, meta-analysis, more computing power than Apollo, mutually assured destruction, Narrative Science, Network effects, Nicholas Carr, personalized medicine, precariat, precision agriculture, Productivity paradox, race to the bottom, randomized controlled trial, reshoring, RFID, rising living standards, Second Machine Age, secular stagnation, self-driving car, sharing economy, Silicon Valley, smart cities, smart contracts, software as a service, Stephen Hawking, Steve Jobs, Steven Levy, Stuxnet, supercomputer in your pocket, The Future of Employment, The Spirit Level, total factor productivity, transaction costs, Uber and Lyft, Watson beat the top human players on Jeopardy!, WikiLeaks, winner-take-all economy, women in the workforce, working-age population, Y Combinator, Zipcar

For companies that are in the business of operating long and complex supply chains, this is transformative. In the near future, similar monitoring systems will also be applied to the movement and tracking of people. The digital revolution is creating radically new approaches that revolutionize the way in which individuals and institutions engage and collaborate. For example, the blockchain, often described as a “distributed ledger”, is a secure protocol where a network of computers collectively verifies a transaction before it can be recorded and approved. The technology that underpins the blockchain creates trust by enabling people who do not know each other (and thus have no underlying basis for trust) to collaborate without having to go through a neutral central authority – i.e. a custodian or central ledger. In essence, the blockchain is a shared, programmable, cryptographically secure and therefore trusted ledger which no single user controls and which can be inspected by everyone.


pages: 182 words: 53,802

The Production of Money: How to Break the Power of Banks by Ann Pettifor

Ben Bernanke: helicopter money, Bernie Madoff, Bernie Sanders, bitcoin, blockchain, borderless world, Bretton Woods, capital controls, Carmen Reinhart, central bank independence, clean water, credit crunch, Credit Default Swap, cryptocurrency, David Graeber, David Ricardo: comparative advantage, debt deflation, decarbonisation, distributed ledger, Donald Trump, eurozone crisis, fiat currency, financial deregulation, financial innovation, financial intermediation, financial repression, fixed income, Fractional reserve banking, full employment, Hyman Minsky, inflation targeting, interest rate derivative, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Rogoff, light touch regulation, London Interbank Offered Rate, market fundamentalism, Martin Wolf, mobile money, Naomi Klein, neoliberal agenda, offshore financial centre, Paul Samuelson, Ponzi scheme, pushing on a string, quantitative easing, rent-seeking, Satyajit Das, savings glut, secular stagnation, The Chicago School, the market place, Thomas Malthus, Tobin tax, too big to fail

But Radiohead (blockchain) was adopted too quickly by those who then compromised the likeability of the entire Indy genre (cryptocurrency). It was time consequently to turn to drum and bass (private blockchains). But drum and bass was being cross-polluted by Indy rock enthusiasts (cryptocurrency enthusiasts) so it became time to embrace something totally radical and segregated, i.e. go backwards to an ironic appreciation of Barry Manilow abandoning all refs to modern musical phenomena (Distributed Ledger Technology). Which puts us roughly at the point where cheesy revivalism should be turning into a general love of the all time provable greats (old school centralised ledger technology, but you know, digitally remastered). Suffice to say, there is some commentary emerging to suggest we are indeed in a phase transition and what’s cool isn’t the blockchain anymore but rather the defiant acknowledgement that the old operating system – for all its flaws – is built on the right regulatory, legal and trusted foundations after all and just needs some basic tweaking.27 In 2016, $70 million worth of bitcoin was stolen from customer accounts held at Bitfinex.


pages: 181 words: 52,147

The Driver in the Driverless Car: How Our Technology Choices Will Create the Future by Vivek Wadhwa, Alex Salkever

23andMe, 3D printing, Airbnb, artificial general intelligence, augmented reality, autonomous vehicles, barriers to entry, Bernie Sanders, bitcoin, blockchain, clean water, correlation does not imply causation, distributed ledger, Donald Trump, double helix, Elon Musk, en.wikipedia.org, epigenetics, Erik Brynjolfsson, Google bus, Hyperloop, income inequality, Internet of things, job automation, Kevin Kelly, Khan Academy, Law of Accelerating Returns, license plate recognition, life extension, Lyft, M-Pesa, Menlo Park, microbiome, mobile money, new economy, personalized medicine, phenotype, precision agriculture, RAND corporation, Ray Kurzweil, recommendation engine, Ronald Reagan, Second Machine Age, self-driving car, Silicon Valley, Skype, smart grid, stem cell, Stephen Hawking, Steve Wozniak, Stuxnet, supercomputer in your pocket, Tesla Model S, The Future of Employment, Turing test, Uber and Lyft, Uber for X, uranium enrichment, Watson beat the top human players on Jeopardy!, zero day

But now Moore’s Law applies, as we have described above, not just to smartphones and PCs but to everything. Change has always been the norm and the one constant; but we have never experienced change like this, at such a pace, or on so many fronts: in energy sources’ move to renewables; in health care’s move to digital health records and designer drugs; in banking, in which a technology called the blockchain distributed ledger system threatens to antiquate financial systems’ opaque procedures.* It is noteworthy that, Moore’s Law having turned fifty, we are reaching the limits of how much you can shrink a transistor. After all, nothing can be smaller than an atom. But Intel and IBM have both said that they can adhere to the Moore’s Law targets for another five to ten years. So the silicon-based computer chips in our laptops will surely match the power of a human brain in the early 2020s, but Moore’s Law may fizzle out after that.


pages: 292 words: 85,151

Exponential Organizations: Why New Organizations Are Ten Times Better, Faster, and Cheaper Than Yours (And What to Do About It) by Salim Ismail, Yuri van Geest

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23andMe, 3D printing, Airbnb, Amazon Mechanical Turk, Amazon Web Services, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, bioinformatics, bitcoin, Black Swan, blockchain, Burning Man, business intelligence, business process, call centre, chief data officer, Chris Wanstrath, Clayton Christensen, clean water, cloud computing, cognitive bias, collaborative consumption, collaborative economy, commoditize, corporate social responsibility, cross-subsidies, crowdsourcing, cryptocurrency, dark matter, Dean Kamen, dematerialisation, discounted cash flows, distributed ledger, Edward Snowden, Elon Musk, en.wikipedia.org, ethereum blockchain, Galaxy Zoo, game design, Google Glasses, Google Hangouts, Google X / Alphabet X, gravity well, hiring and firing, Hyperloop, industrial robot, Innovator's Dilemma, intangible asset, Internet of things, Iridium satellite, Isaac Newton, Jeff Bezos, Kevin Kelly, Kickstarter, knowledge worker, Kodak vs Instagram, Law of Accelerating Returns, Lean Startup, life extension, lifelogging, loose coupling, loss aversion, Lyft, Marc Andreessen, Mark Zuckerberg, market design, means of production, minimum viable product, natural language processing, Netflix Prize, Network effects, new economy, Oculus Rift, offshore financial centre, p-value, PageRank, pattern recognition, Paul Graham, peer-to-peer, peer-to-peer model, Peter H. Diamandis: Planetary Resources, Peter Thiel, prediction markets, profit motive, publish or perish, Ray Kurzweil, recommendation engine, RFID, ride hailing / ride sharing, risk tolerance, Ronald Coase, Second Machine Age, self-driving car, sharing economy, Silicon Valley, skunkworks, Skype, smart contracts, Snapchat, social software, software is eating the world, speech recognition, stealth mode startup, Stephen Hawking, Steve Jobs, subscription business, supply-chain management, TaskRabbit, telepresence, telepresence robot, Tony Hsieh, transaction costs, Tyler Cowen: Great Stagnation, urban planning, WikiLeaks, winner-take-all economy, X Prize, Y Combinator, zero-sum game

Implications: Algorithms driving more and more business decisions; AIs replacing a large percentage of knowledge workers; AIs looking for patterns in organizational data; algorithms embedded into products. Virtual/augmented reality Description: Avatar-quality VR available on desktop in 2-3 years. Oculus Rift, High Fidelity and Google Glass drive new applications. Implications: Remote viewing; centrally located experts serving more areas; new practice areas; remote medicine. Bitcoin and block chain Description: Trustless, ultra-low-cost secure transactions enabled by distributed ledgers that log everything. Implications: The blockchain becomes a trust engine; most third-party validation functions become automated (e.g., multi-signatory contracts, voting systems, audit practices). Micro-transactions and new payment systems become ubiquitous. Neuro-feedback Description: Use of feedback loops to bring the brain to a high level of precision. Implications: Capacity to test and deploy entirely new classes of applications (e.g., focus@will); group creativity apps; flow hacking; therapeutic aids, stress reduction and sleep improvement.


pages: 364 words: 99,897

The Industries of the Future by Alec Ross

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23andMe, 3D printing, Airbnb, algorithmic trading, AltaVista, Anne Wojcicki, autonomous vehicles, banking crisis, barriers to entry, Bernie Madoff, bioinformatics, bitcoin, blockchain, Brian Krebs, British Empire, business intelligence, call centre, carbon footprint, cloud computing, collaborative consumption, connected car, corporate governance, Credit Default Swap, cryptocurrency, David Brooks, disintermediation, Dissolution of the Soviet Union, distributed ledger, Edward Glaeser, Edward Snowden, en.wikipedia.org, Erik Brynjolfsson, fiat currency, future of work, global supply chain, Google X / Alphabet X, industrial robot, Internet of things, invention of the printing press, Jaron Lanier, Jeff Bezos, job automation, John Markoff, knowledge economy, knowledge worker, lifelogging, litecoin, M-Pesa, Marc Andreessen, Mark Zuckerberg, Mikhail Gorbachev, mobile money, money: store of value / unit of account / medium of exchange, new economy, offshore financial centre, open economy, Parag Khanna, peer-to-peer, peer-to-peer lending, personalized medicine, Peter Thiel, precision agriculture, pre–internet, RAND corporation, Ray Kurzweil, recommendation engine, ride hailing / ride sharing, Rubik’s Cube, Satoshi Nakamoto, selective serotonin reuptake inhibitor (SSRI), self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart cities, social graph, software as a service, special economic zone, supply-chain management, supply-chain management software, technoutopianism, The Future of Employment, underbanked, Vernor Vinge, Watson beat the top human players on Jeopardy!, women in the workforce, Y Combinator, young professional

Fraud is further diminished by the fact that every bitcoin carries its history with it; to try to counterfeit a coin would require counterfeiting a false lineage going back all the way to the beginning of Bitcoin. It would never be accepted by the system, since the millions of copies of the ledger that reside throughout the rest of the Bitcoin network would not have any record of this counterfeit coin or its invented history. A widely distributed ledger lets everyone know who has what and prevents any individual from barging in with counterfeited property. The major headache that Satoshi Nakamoto conquered, and that every previous cryptocurrency had failed to manage, was the question of how to update that decentralized ledger: How could you make sure that the millions of copies of the master ledger, which are located far and wide throughout the Bitcoin network, are all the same, all accurate, all up to date, without anyone cheating?