<nettime> Blockchain & Bureaucracy (review of blockchains for social good workshop)

[Max Dovey <maxdovey@gmail.com>]

   Blockchain & Bureaucracy.

   Report from 'blockchain for social good' workshop at European
   Commission, 21st June 2016.

   On 21st June the Digital Single Market Council (a division of EU
   parliament) invited the full cavalry of blockchain and bitcoin
   advocates to Brussels to discuss the future of distributed ledger
   technology (DLT) (https://ec.europa.eu/digital-single-market/en/news/blockchains-social-good). The room was packed full of entrepreneurs, business people and
   middle management consultants all demonstrating an interest into
   blockchain technology, and how they can get to grips with the new
   technology to turn blockchain into a 'technology for social good'.

   I was immediately surprised by the imperative taken by EU council to
   host such an event as it shows that blockchain advocates have clearly
   kicked up enough of a storm to reach the agenda of European Parliament.
   The attempts to professionalize blockchain technology and begin to
   strategically plan its implementation into European policy were
   unfortunately slightly tarnished by the calamitous DAO ether hack that
   had occurred 2 days before. Although most speakers were forced to
   address the DAO scandal and offer short term practical solutions
   (rolling back Ethereum platform to reverse and cancel previous
   transactions) nobody was keen to say how badly this 'bug in the code'
   had effected the political values and social credibility of DLT. The
   powerful and enchanting rhetoric of blockchain took a severe tumble
   after Vitalik called for a cease of trading to help stop the ether
   hack, turning the bright prospect of a de-centralized autonomous market
   into a gloomy centralized dictatorship.

   Although DAOs and Ethereum are just one part of a much wider horizon of
   DLT potential, we should not forget that a lot of the de-centralized
   socialist storytelling involves smart contracts and DAO technology
   cutting out intermediaries to empower collective citizen governance.
   Much of this rhetoric has repeatedly been told by Ethereum ambassadors
   such as Vinay Gupta and Primavera de Filippi. So it was somewhat
   contradictory to hear De Filippi discuss the potential for
   de-centralized autonomous organisations to contest top down power
   structures in none other but European Parliament in Brussels - probably
   the most visible examples of centralized power in the west. While De
   Filippi opened the morning session discussing the potential for DAOs
   and the implications of smart contract legislation, many of the
   audience grappled with some unfamiliar concepts and terms in attempt to
   convert this new wave of disruptive tech into their business logistics.
   For many there, this event was an opportunity to gain and understanding
   of blockchain and apply de-centralized technology into their long term
   business prospects. There were advocates from both sides of the
   blockchain debate, representatives from Visa, Mastercard and IBM sat
   alongside Bitcoin evangelists such as Pindar Wong from scaling Bitcoin
   (https://scalingbitcoin.org/hongkong2015/) and Amin Rafiee from
   Bitnation (https://bitnation.co/). Matthew Golby-Kirk from IBM
   presented the hyper ledger (https://www.hyperledger.org/) a
   collaborative effort to offer commercial or private scalable versions
   of blockchain, where p2p values manifest into business-to-business
   logistics. There were very few examples of 'social good', unless you
   can interpret social good as lowering logistic costs and increasing
   profits. Jessie Baker offered some 'real world solutions' rather than
   just back-end technical fixes for big companies, in the form of
   provenance.org, where products are registered and tracked using
   blockchain to ensure an equitable supply chain. This is still in early
   development but has successfully been applied in the fishing industry
   to ensure the catch of the day has been caught legally. In the few
   examples of blockchain technology that were presented during the
   workshop many seemed to enforce existing regulatory structures with
   networked computing, such as EU fishing regulations (in the case of
   provenance.org). It was interesting to observe how blockchain
   technology was maturing into commercial business contexts to actually
   enforce existing regulatory frameworks rather than create opportunities
   for self-organized unregulated social structures. Generally, the
   implementation of blockchain in businesses that are capable of adopting
   the technology is geared towards replacing middle management and
   intermediaries with autonomous, de-centralized code. Take for example,
   the research into DLT by Catherine Mulligan at Imperial College, who
   have developed a program that uses blockchain to verify qualifications
   listed on job applications and resumes. Rather than becoming a tool for
   self-organised community empowerment, DLTs are quickly being
   incorporated into verification software and transaction based systems.
   Companies and businesses seem to be the first to seize the benefits of
   a digital public ledger as an administrative tool for legitimising
   digital exchange and managing information with de-centralized
   infrastructures.

   Fortunately, there were two presentations in the afternoon that
   questioned the commercial application of blockchain technology and even
   offered some more inspiring visions of DLTs in social projects. Brett
   Scott (The Heretics Guide to Global Finance) wanted to re-frame the
   interpretation of the 'blockchain for social good' title and move
   towards a discussion on financial inclusion and network monopolies.
   Brett asked how, if possible, can DLT provide alternative expressions
   of value that can improve financial inclusion rather than streamline
   the technical infrastructures of existing financial corporations.
   Although many of the businesses present seem keen to break up platform
   monopolies (Amazon, Google, etc.), there seems to be little planning or
   interest into how blockchain and decentralized technologies can
   actively re-distribute wealth for the long term, rather just pan out as
   another disruptive technology in the competition for market dominance.

   It was also fascinating to hear more from Dyne.org whose CAP research
   into re-designing democracy has led to technical prototypes that are
   being used in political parties and communities across Europe.
   Iceland's complimentary currency to incentivize political engagement
   and participatory accounting for the council of Reykjavik is a
   promising example of de-centralized technology being used for
   non-commercial citizen based incentives. The outcome of Dyne's research
   project is wide and diverse but Marco offered a stimulating perspective
   of alternative expressions of value with DLTs that support communities
   and non-commercial infrastructures.

   Instead of dealing with the underlying concerns and original
   opportunities associated with blockchain, the workshop predominantly
   consisted of endless examples of blockchain applications and business
   prototypes that strive to become new players in the de-centralized tech
   market. Interesting confrontations between Jakob von Weizsäcker
   (member of the European Parliament) and Bitcoin fanatics provided some
   light entertainment, with Von Weizsäcker concluding, somewhat
   defensively, 'you cannot regulate what you don't understand'.

   To help EU Digital Social Innovation Board understand blockchain
   technology further they have allocated 2 billion EUR over the next 10
   years for research and development. By that time I imagine distributed
   ledger technology will be firmly cemented into the global industry as
   the potential for networked transaction systems is appropriately fitted
   to serve the interests of commercial trade. The inability to imagine
   alternative use cases for p2p distributed networks to enable greater
   financial inclusion, citizen empowerment or civil organization will
   lead to the inevitable commercialization and privatization of
   blockchain, and bankers will fondly remember Bitcoin as the greatest
   gift the hackers ever made.

   Article pasted from -
   http://networkcultures.org/moneylab/2016/07/12/%c2%adblockchain-bureaucracy/
   Moneylab#3 : Failing Better | 1 & 2 Dec 2016 | Pakhuis de Zwijger,
   Amsterdam -
   http://networkcultures.org/moneylab/program-3/conference-sessions/

   Mx
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