The World Beyond Blockchain – Part 2/3: The Eye of the Storm

February 15, 2018 Leave a comment
Even as early as 2013, it was already clear the immense impact that Blockchain could have on: industries, individuals and society at large. Even as Bitcoin futures markets were launched in late 2017 (complete with cryptocurrency primer), and as the Bank of England considers introducing a UK cryptocurrrency, it is instructive to observe the speed at which things develop and evolve, almost on a daily basis. For example, the intense volatility of a major cryptocurrencies such as Bitcoin, with over 50% drop from a peak of almost $20,000 (in Dec 2017) to less than $8000 (in Feb 2018) is actually considered by some to be business as usual. Blockchain expert, Haydn Jones, at BlockchainHub, suggests that such highs and lows are actually indicative of active trading by buyers and sellers in a robust market. Besides, several other factors may also have exacerbated the huge price movement, e.g.: price manipulation (see allegations against Bitfinex / Tether), opportunistic short selling, tougher regulatory landscape, and even the Chinese / Lunar New Year!

 

 

Regardless of ongoing cryptocurrency price fluctuations, the above diagram depicts several key industries and activities which are currently or imminently undergoing, significant disruption by the Blockchain.

 

According to Blockchain researcher, Bettina Warburg, the Blockchain “provides a shared reality across non-trusting entities” which helps to: reduce uncertainty (via transparency), assure identity (via trust authentication), enforce asset tracking (via auditing) and guarantee execution / delivery (via smart contracts), all powered by mutual mistrust. Therefore, any industry or institution that relies on trusted 3rd party mediation is open to disruption by solutions that remove the need to know or trust the other party in a transaction. The Blockchain’s distributed, decentralised ledger of immutable transaction blocks is the trust platform upon which such transactions can occur. The successes of Bitcoin, and other cybercurrencies, attest the fact that the Blockchain is indeed the protocol that drives the so called Internet of value. It truly brings to life Professor Niall Ferguson’s assertion that “Money is trust inscribed”, even in the digital realm.

 

So many examples abound of new and pre-existing use cases for cryptocurrencies, smart contracts and DAOs (aka Decentralised Autonomous Organisations). They encompass diverse areas and players too numerous to mention and a recent CBInsights Webinar presentationoutlines the use of Blockchain in the enterprise.

 

The rising star du jour is the use of ICOs (or Initial Coin Offerings) for fund raising, which enables teams to raise sometimes eye watering amounts of money over a short space of time in exchange for coins or utility tokens at the launch of their solution. One recent ICO raised $36 Million in 1 minute! In comparison, you can probably see why the dot com bubble could be considered a sedate walk in the park.

 

Another emerging trend are faster, more scaleable, and fee-less cryptocurrencies which can be used to facilitate the low value and high velocity / volume transactions needed for the Internet of Things (IoT). These are next generation networks designed to get even faster through-put as the size of the network increases – in true to life network effect. Key players include IOTA, RAIBlocks and the proprietary Hashgraph. However they are all very much bleeding edge propositions, with many questions as yet to be answered.

 

Several concerns or potential roadblocks exist on the runaway expansion of the Blockchain, such as:

 

  • Increased regulation – There’s a looming threat or promise of tighter intervention by regulatory bodies and governments, especially for ICOs due to their conceptual proximity to the highly regulated securities industry. Other drivers include: reducing tax evasion, fraud, money laundering, anti-terrorism, as well as impact on PII (Personally Identifiable Information) data vs. the right to be forgotten and GDPR.
  • Security – Also, many security concerns persist, particularly in light of regular headlines about hacking, outright theft and other malfeasance. Increased Cryptojacking, i.e. the practice of stealing other people’s device processing power to mine cryptocurrency, is also a concern.
  • Scalability and fragmentation – it takes significant computing effort to mine Bitcoins, or to verify transactions, which has long raised concerns over its long term performance and scalability. The resulting splits or ‘ forks’ in that cryptocurrency have provided a vast array of competing coins (e.g.: Bitcoin! / Bitcoin XT / Bitcoin Unlimited / Bitcoin Cash / Segwit / Bitcoin Gold). Furthermore, there are myriad cryptocurrency wallets and exchanges to chose from, which can be rather daunting. Also the aforementioned next generation networks which use: Directed Acyclic Graphs (DAG) / voting algorithms / gossip protocols to deliver more flexibility, scale and performance.
  • Energy Consumption – Furthermore, the high cost of energy required to mine proof-of-work cryptocurrencies is another growing area of concern as it contributes to the spectre of global warming.
  • Privacy – Finally, the early association of Bitcoin with illicit and subversive activities on darknet sites (such as the defunct Silk Road and Alphabay) hasn’t really gone away, especially with the rise of privacy focused cryptocurrencies such as: Monero, Dash, zCash, Verge and DeepOnion. Contrary to popular belief, Bitcoin itself does not guarantee privacy because transactions can be linked to individuals (albeit with some effort), and all Bitcoin transactions are recorded for posterity on a very public Blockchain.

 

In light of the above opportunities and challenges, it is plain to see that the Blockchain technology is just at the starting line on a lengthy course of disruption and upheavals as yet unimagined. However, in the third and final part of this blogpost series, we’ll take a look at key scenarios and likely outcomes and conclusions after the storm has passed and dust settled.

 

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The World Beyond the Blockchain – Part 1/3: The Perfect Storm

January 28, 2018 Leave a comment
In 2016, when my last article about the Blockchain and Bitcoin was published, the cryptocurrency was valued at about $400, which at the time seemed the result of fever pitch speculation and media hype. Fast forward to December 2017 and the order of magnitude increase, with over 1300% ROI in 2017alone, appears decidedly hallucinatory, but even that is nothing compared to the estimated $200,000+ peak valuation predicted by the time the last of 21 million possible Bitcoin has been mined. According to the maths, even if you were to invest in Bitcoin at $10,000 or $20,000 you’ll still stand to make an order of magnitude return on your investment well before that last bitcoin is mined! Such irrational exuberance, fools gold and / or mega bubble surely challenges previous examples, (e.g.: the infamous Dutch tulips, South Sea bubble or dot com bubble), for supremacy in foolhardiness, or does it?

Anyway, instead of all that hand wringing speculation, this three part post (from a forthcoming article for ITNow magazine) will focus on the perfect storm that has brought things to this point (in Part 1); it will explore current and emerging trends (in Part 2), and discuss possible scenarios that will likely play out after the dust settles (in Part 3), before concluding with a few recommendations on the way forward to the world beyond the Blockchain.

The winds of change – key Ingredients for the perfect storm:
We can acknowledge that Bitcoin is the first and perhaps most disruptive application of the Blockchain, at least for now. The following factors have combined to drive its emergence as a jaw dropping speculative investment opportunity, and the underlying blockchain technology as a revolutionary engine for hyper-charged innovation:
1 – Technology drivers:
  • According to CBIsights Research, Bitcoin is the first decentralized, censor-proof, portable, secure, durable, and scarce digital asset.
  • The underlying Blockchain is built on a solid foundation of proven technologies including public key cryptography, hashing and TCP/IP (aka the Internet protocols).
  • The Blockchain is one of several disruptive technologies that will enable and drive the so-called fourth industrial revolution.
2 – Global socio-economic, political and demographic drivers
  • Following 2008’s financial meltdown, with subsequent financial reforms and various other aftershocks, many institutions, including banks and governments, are suffering a major ‘crises of legitimacy‘ which is eroding their traditional role as trusted middlemen for many transactions
  • Global unemployment, hunger, terrorism, wars, natural disasters and mass migration all highlight and exacerbate inequality, xenophobia, mistrust and dissatisfaction with the status quo.
3 – Geometric scale disruption
  • The speed and scale of disruption and adoption of Blockchain applications is phenomenal, and it challenges existing systems of production, managment and governance
These key ingredients combine and contribute to the current frenzied interest in cryptocurrencies as well as the development of new, disruptive applications, business models and emergent behaviours powered by the Blockchain. In the second part of this blogpost series, we’ll take a look at the emerging opportunities and challenges to be found in the eye of the storm.

[Book Review] of God, Man and Machines

June 18, 2017 Leave a comment

Book Title: Homo Deus A Brief History of Tomorrow. 

Author: Yuval Noah Harari

Overall Score: 9 (out of 10)

This has to be one of the more thought provoking books I have read in a while, and it boldly tackles a complex and far reaching subject at a most opportune time. Human evolution is something that has fascinated people since Darwin’s seminal work on the origin of then species, perhaps even moreso now with the advent of true A.I. The thought of self learning systems powering an autonomous independent entity can send shivers down the backs of even the most unflappable of people when it becomes real.

Homo Deus is Yuval Noah Harari’s second work on the topic of man’s evolution and he does not disappoint. His previous work, Sapiens, paints a compelling picture of the journey humanity has undertaken to get to this point. This work takes us on the next step of that journey by looking ahead into the future of humanity, assuming the current trajectory remains unchanged, in a way that is equally compelling and enlightening.

According to a central argument in the book, the emergence of Homo deus or ‘divine man’ is the logical next step in human evolution. Homo sapiens (aka thinking man) has progressed far enough on this journey that he is virtually at the cusp of achieving that goal along with mastery of 3 key defining pursuits, i.e: immortality, happiness and divinity. Such a breed of superhuman beings will be sufficiently different from Homo sapiens that the author has chosen to classify them as Homo deus. 

The book traces human belief systems from: belief in divine objects and beings, to belief in society states, and latterly a belief in the individual aka humanism. This is observed to be in step with expanding human communities: from individual family groups and clans to villages, towns and cities; each tier is enabled or limited by man’s ability to source food, security and the prevailing communication technology. There is a certain symmetry in the observed progression from God to man and to machines, as it’s the latter which is fueling the accelerated evolutionary leap to this new species of human being known as Homo deus.

In addition to excellent coverage of realistic humanism and post humanist scenarios, Harari provokes some insightful questions about the next phase of technology enhanced super-humanity and the emerging belief system of Dataism. Dataism describes the current scientific dogma that unites all branches of learning, and which effectively places man in his place as just another data processing system, amongst all other data processing systems, in a world where everything is all about data. He also touches on the inequity that is bound to become even more pronounced when the elites and their robot assistants / overlords decide to do away with the rest of humanity.

Although this is one heck of an interesting book, it doesn’t escape comparison with Harari’s initial masterpiece, which somehow manages to make this work appear less fully-formed and lightweight in relation to Sapiens. It asks more questions, albeit really good ones, than it answers, and somehow contrives to ignore the forest for the trees. By this I mean the relative pace of evolution among different species within an ecosystem. Homo Deus if they ever emerge will have to co-exist with and perhaps dominate other species on the planet, but will themselves be dependent on sustainable wellbeing and balance of the ecosystem in which they find themselves.

In spite of the above, and in conclusion, Homo Deus is a delightful, thought provoking peek at a posssible next phase of human cultural evolution and data driven existence. It is no surprise that it made the list of books reviewed and recommended by none other than Bill Gates in his 5 Good Summer Reads blog post. For this and other reasons stated above, I give it a resounding 9 marks out of 10.

Fidget spinning and the ‘big brain’ syndrome.

May 29, 2017 Leave a comment

Looking ahead into the future, some forward thinking people might ask what key skills the younger generation should develop in order to survive, thrive and succeed in tomorrow’s world. There is no doubt in their minds that the skills, qualifications and advantages of the present day will no longer suffice in the technology infused world of tomorrow.

 

image4-edit-smFor obvious reasons, any answers to this question should be taken with a pinch of salt, therefore I shan’t even venture into that minefield, but suffice to say that judging from current trends in tech (e.g. biotech, AI, IoT, data analytics, and even Blockchain), the future will be something far more dynamic and fluid than we currently imagine and it’ll challenge even the best of us to compete. However, the ability to adapt to change is probably humanity’s greatest asset, and in this case, that ability resides in mankind’s evolutionary weapon of choice – the brain. It’ll require a big enough brain to recognise, comprehend and grasp the opportunities that present themselves in a post human transition.

I say post human transition because we’ll likely need superhuman abilities to engage effectively with even a mere subset of the predicted changes to come. The enabling technologies in place today only hint at possibilities beyond which we cannot easily envisage. A few weeks ago I came across someone with the big brain outlook, and based on our conversation, I came away with a few key characteristics that can help define the big brain advantage, as follows:

  1. It’s a lonely existence – having a big brain means stepping out on a limb. Even when others are busy fretting about current and future ghosts or bogeymen, they’ll often go out alone into the dark to explore the extent of an unfolding phenomenon.
  2. It takes guts – in order to be able to step out into the unknown, you’ll need a pair of big brass balls to scare any real or perceived demons in the dark. Innovators and pioneers meet this challenge head-on and forge ahead where others fear to tread.
  3. An eclectic worldview is essential – the ability to appreciate the big picture in all its variety, diversity and pervasive interconnectedness is crucial to this mindset. Look for it in those with atypical backgrounds and experiences, e.g. that well-travelled outlier in a homogenous group.

So what has this go to do with the humble, if irritating fidget spinner? Well a fidget spinner requires some manual dexterity as well as sensory input and feedback, and it apparently helps those with certain forms of attention deficit disorders, but it has gone viral and become a fad with school age kids (& some adults) everywhere.

Bipedal locomotion, opposing thumb digits and accompanying manual dexterity are adaptions that contributed to the evolution of ‘big brained’ Homo sapiens, aka thinking man. This evolutionary advantage led to the dominance of human beings on earth. In much the same light, it could be argued that those heads-down, hunch-shouldered, smartphone-wielding people you find everywhere these days are merely taking human cultural evolution to the next level by mastering necessary digital dexterity and information processing skills required to gain that digital advantage. So next time you see a fidget-spinning, smartphone-messaging kid, be rest assured this is a fine specimen of the next phase in human evolution – Lord help us all!

Copyright, Blockchain, Technology and the State of Digital Piracy

January 15, 2017 Leave a comment
The next installment of one of my favourite conferences on copyright and technology is right around the corner, on January 24th in NYC, and as usual it promises some interesting: debate, controversy and hot-off-the-press insights into the murky world of copyright business, technology, and legislation. Plus, this year, it also features a panel on the game changing technology of blockchain and its myriad disruptive applications across entire industries, including copyright and the creative industries.

Thankfully, the inclusion of this panel session recognises the never-ending role of new and innovative technologies in shaping the evolution of Copyright. Ever since that first mass copy technology (i.e. the printing press) raised questions of rights ownership, and due recompense for works of the mind, new technologies for replicating and sharing creative content have driven the wheel of evolution in this area. Attendees will doubtless benefit from the insight and expertise of this panel of speakers as well as moderator and Program Chair, Bill Rosenblatt, who questioned (in a recent blog post), the practicality, relevance and usefulness of blockchain in a B2C context for copyright. You are in for a treat.

This is a very exciting period of wholesale digital transformation, and as I mentioned once or twice in previous articles and blog-posts, the game is only just beginning for potential applications of: blockchain, crypto currencies, smart licences and sundry trust mechanisms in the digital domain. In an age of ubiquitous content and digital access, the focus of copyright is rightfully shifting away from copying and moving towards the actual usage of digital content, which brings added complexity to an already complex and subjective topic. It is far too early to tell if blockchain can provide a comprehensive answer to this challenge.

The Copyright and Technology conference series have never failed to provide some thought-provoking insights and debates driven by expert speakers across multiple industries. In fact, I reconnected recently with a couple of previous speakers: Dominic Young and Chris Elkins, who are both still pretty active, informed and involved in the copyright and technology agenda. Dominic, ex-CEO of the UK’s Digital Catapault, is currently working on a hush hush project that will potentially transform the B2C transaction space. Chris is co-founder Muso, a digital anti-piracy organisation which has successfully secured additional funding to expand its global footprint with innovative approaches to anti-piracy. For example, if you ever wondered which countries are most active in media piracy, then look no further than Muso’s big data based state of digital piracy reports. Don’t say I never tell you anything.

In any case, I look forward to hearing attendees impressions on the Copyright and Technology 2017 conference, which I’m unable to attend / participate this timme unfortunately. In the meantime, I’ll continue to spend my spare time, or whatever brain capacity I have left, with pro-bono activities that allow me to: meet, mentor / coach and advise some amazing startups on the dynamic intersection of IP, business and technology. More on that in another post.

Intellectual Property for Start-Ups

October 28, 2016 Leave a comment

A few weeks ago I had the opportunity to participate, as chair & speaker, at a BCS Entrepreneurs event discussing the role and value of Intellectual Property for start-ups and entrepreneurs. As you might imagine this was a well attended event with so many different questions foremost on the minds of various attendees.

Given the focus on my favourite topics of IP and entrepreneurship, it didn’t take much persuasion for me to sign-up and chair the event. Furthermore, I was in the company of two legal experts on: EU IP law (Jonathan Exell, from William Powells) and employment law (Bob Fahy, from Veale Wasbrough Vizards) respectively. Also the attendees were certainly not shy to engage and they took some delight in systematically dissecting the trickier aspects of entrepreneurship and the start-up vs. IP challenge in a changing landscape. 

As introduction and kickoff, I provided a quick overview of some of those key challenges facing startups with respect to IP. This was mainly based on a previous post and article I’d written and published about this same topic. 

The first speaker followed through with a thorough recap of the legal position on IP particularly with regard to the EU and Brexit. Key message: it’ll likely be business as usual for IP in post Brexit UK, at least in the near term. Also, it is highly unlikely that the UK will deviate too radically from the increasingly aligned position on IP  which most of the world enjoy today.

The second legal perspective provided some insights on key challenges and opportunities facing anyone trying to manage the IP risks and issues associated with employees, disgruntled or otherwise. Here the lines become somewhat blurred between contract vs. employment vs. IP laws. It was interesting to observe the number of questions relating to how founders should approach the challenge of establishing who has what IP (and / or portions thereof) when their start-up fails, flounders, or even flourishes!

To say this event was informative and enlightening would be an understatement because the second part of the seminar consisted of 1-to-1 mentorship sessions, with experienced BCS mentors exploring attendees individual circumstances in order to provide specific guidance based on the topic at hand. Pure value delivered, if you ask me. As an exercise in giving back, I can think of no better way to spend an evening than by learning, interacting and exploring various start-up IP challenges with enthusiastic entrepreneurs, mentors and experts from within and outside of the BCS.

One thing I love about my work is how it affords me unfettered opportunity to give back, by providing dedicated time (and a measurable objective) to undertake pro bono activities, such as this one, which is aimed at helping others in need of expertise or guidance for projects, worthy causes or personal development. Pure Ohana!

The Tech Start-Up’s IP Dilemma

September 4, 2016 Leave a comment
When it comes to tech entrepreneurship, a good Intellectual Property (IP) strategy will often play a critical role in the difference between unbridled success versus failure-inducing infringement lawsuits. How should technology entrepreneurs and start-ups approach the difficult task of balancing IP protection vs. commercialization considerations in the dynamic, financial and geo-political landscape of today?

In the face of recent global financial meltdowns, migrant refugee crises, global terrorism and regional upheavals (e.g. BREXIT), things may become exponentially more complicated. In terms of IP, the key question for many high-growth start-ups is how to negotiate the daunting landscape of protocol, jurisdiction and regulatory compliance requirements for each new market that they penetrate.

3 key factors, in my opinion, need to be taken into consideration when attempting to address these particular challenges as follows:

Pay to play – The digital world has ushered in a shift from transactions to a more interaction based economy. According to Constellation Research Principal, Andy Mulholland, three distinct types of time-zone based interactions can be recognized in this new environment. They comprise of: reflex interactions (e.g. autonomous machine to machine interactions); service based interactions (i.e. multiple, coordinated services interacting to deliver value to customers / subscribers / end-users); and finally, cognitive interactions (delivering enhanced value as part of a ‘smart’ system and ecosystem).

Changing of the Guard – IP is a moveable feast, and sooner or later any proponent of “free-to-use” IP soon become vigorous advocates of IP protection once they start producing their own. Nations that were once net consumers of IP, with scant regard for anti-piracy measures, will often become rabid defenders of international IP laws when they start producing more IP than they consume. The same applies to start-ups who initially think nothing of appropriating other people’s IP in other to create or enhance their own products / services, but then go on to spend oodles of funding money with top IP lawyers to protect or defend their IP as they mature.

Caring, sharing, gig economy – The last point is very much about the real cost of freedom and flexibility. The so called “Gig economy”, which offers short term roles for hordes of contingent workers (aka ‘micro entrepreneurs’), has been popularised by the likes of Uber, Airbnb and Deliveroo, because they promise a greater degree of freedom and flexibility than traditional employer / employees models. The new gig economy players typically provide a platform for exchanging goods and services, but sometimes this can verge on the traditional ’employee’  domain, (e.g. wearing uniforms with the platform providers logo), instead of an independent provider. This blurring of lines could be interpreted by many as an attempt by platform operators to have their cake and eat it, and this has contributed to the recent spate of high profile law suites and demonstrations by irate contingent workers. Such disruptive business practices bring to mind the threat posed to traditional content industries by file sharing platforms such as: Naptster, Grokster, Pirate Bay and Megaupload, who all got sued to smithereens. The sad thing is that such repercussions, if unchecked, can serve to dampen the innovative vigour of said ‘gig economy’ platform operators. A middle ground must be found where it will be possible to explore the frontiers of the new gig economy without trampling over the rights of its participants. The promise of freedom and flexibility alone may not be worth the pixels through which it is displayed.

In conclusion, when it comes to startup entrepreneurship in today’s world, it takes a certain level of awareness to negotiate the myriad challenges facing new innovative / disruptive entrants to most markets. One of the key criteria for success, (in addition to having the right ideas, resources, team and opportunity / timing), is the presence of a good strategy for intellectual property and how it can be employed to the benefit of the organisation. It is no accident that California USA, with its high concentration of IP based industries, is the 6th largest economy in the world, therefore it goes without saying how important it is for startups to identify and protect any IP assets, right from the start.

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Disclosure: The above post is derived from a soon-to-be-published article in the next edition of BCS Digital Leaders newsletter. Also the topic of start ups and IP will be the focus of the next BCS Entrepreneurs speed mentoring event which I’ll be chairing in the next few weeks.