Blockchain and the state:

Ve­hi­cle or vice?

AQ: Australian Quarterly - - CONTENTS - ZAC ROGERS

As ul­tra­mod­ern as they may seem, cryp­tocur­ren­cies and their un­der­ly­ing dis­trib­uted ledger tech­nol­ogy (com­monly re­ferred to as the blockchain), rep­re­sent the in­ter­twined evo­lu­tion of two pro­saic yet fun­da­men­tal pil­lars of civil­i­sa­tion: money and ac­count­ing. From the ear­li­est is­suance of barter to­kens, to coins of pre­cious metal, pa­per notes, then dig­i­tal strings of ones and ze­roes - and the sin­gle and dou­ble-en­try ledger ac­count­ing meth­ods used to record transactio­ns and own­er­ship by trad­ing houses and the first banks - one fea­ture of these two pil­lars has been ubiq­ui­tous and con­stant: cen­tral­i­sa­tion.

For all of these mone­tary sys­tems to func­tion an au­tho­ris­ing in­ter­me­di­ary has stood over is­suance of cur­rency, and stood be­tween trans­ac­tors, pro­vid­ing them with the ca­pac­ity to trust one an­other. This sta­bilises the value of the medium of ex­change, the se­cu­rity of the trans­ac­tion, and the in­tegrity of the record, what­ever it may com­prise. The in­ter­me­di­ary ac­crued power via the in­dis­pens­able role it played in fa­cil­i­tat­ing trust, and the cen­tral­i­sa­tion of au­thor­ity, as corol­lary, lit­er­ally cre­ated

civil­i­sa­tion as we know it. The seats of po­lit­i­cal and fi­nan­cial power have thus re­mained, to this day, with gov­ern­ments and cen­tral banks.

Yet in 2007-8 this man­u­fac­tured struc­ture of cen­tralised trust was re­vealed as any­thing but trust­wor­thy. The fi­nan­cial and po­lit­i­cal im­plo­sions of the GFC be­came a unique op­por­tu­nity for an al­ter­na­tive to this sys­tem of cen­tral­i­sa­tion. In Jan­uary 2009 Bit­coin came qui­etly into ex­is­tence util­is­ing the blockchain, to be­come the first work­ing ex­am­ple of a de­cen­tralised dig­i­tal cur­rency paired with a triple-en­try ac­count­ing method.

Bit­coin re­quired no in­ter­me­di­ary for fi­nan­cial transactio­ns, no cen­tral au­thor­ity; the foun­da­tional un­der­pin­ning of the world’s mone­tary sys­tem had been silently by-passed. Re­ac­tion was muted at first, and mostly dis­mis­sive. Now, al­most a decade later, one Bit­coin is val­ued at 13 times the price of gold (at the time of writ­ing).

Out­side of a very small, spe­cialised com­mu­nity, aware­ness of the sig­nif­i­cant po­ten­tial of Bit­coin’s dig­i­tal ar­chi­tec­ture was al­most nil un­til about 2013. When com­men­ta­tors did weigh in, cryp­tocur­ren­cies such as Bit­coin, were as likely to be hailed as the fu­ture of money and des­tined to side­line tra­di­tional repos­i­to­ries of au­thor­ity, as they were to be de­rided as a ‘scam’ or yet an­other false dawn in the as-yet un­re­alised de­cline of the state, and its tra­di­tional seats of po­lit­i­cal and fi­nan­cial power.

Yet in only a few years, when Bit­coin failed to dis­ap­pear into the ether, the state and other forms of es­tab­lished au­thor­ity (par­tic­u­larly com­mer­cial banks) have spot­ted the po­ten­tial of blockchain-based ap­pli­ca­tions and have set about bas­tar­dis­ing the con­cept, di­rectly at odds with blockchain’s crypto-punk roots.

The more schol­arly analy­ses of the dis­rup­tion to these seats of power posed by dig­i­tal in­for­ma­tion and com­mu­ni­ca­tion tech­nolo­gies (ICT) – and its creep­ing dis­in­ter­me­di­a­tion of in­ter-state and in­tra-state bound­aries – has fo­cused on the im­pacts on the fi­nan­cial and mone­tary re­la­tions of elec­tronic money, 1 im­pacts on so­cial, cul­tural, and po­lit­i­cal in­sti­tu­tions of the dig­i­tal net­worked age, and par­tic­u­larly af­ter Snow­den, the 2 im­pact of mass dig­i­tal sur­veil­lance. 3

These av­enues of en­quiry clearly share a com­mon de­nom­i­na­tor, how­ever: the sub­ject mat­ter of so­cial, po­lit­i­cal, eco­nomic, and se­cu­rity stud­ies are now em­bed­ded in a dig­i­tal sub­strate that is ex­pand­ing its ma­te­rial form and, there­fore, al­ter­ing its so­cial mean­ing. Blockchain is in­ter­est­ing be­cause it of­fers the dig­i­tal sub­strate a struc­ture from which some forms of agency can be clawed back. In a near-term world sat­u­rated by data, this agency will be the ba­sis from which any ac­tor man­ages to sink or swim. A small num­ber of ac­tors may ex­cel, with

In Jan­uary 2009 Bit­coin came qui­etly into ex­is­tence… the foun­da­tional un­der­pin­ning of the world’s mone­tary sys­tem had been silently by-passed.

rad­i­cal im­pli­ca­tions for so­ci­ety.

Money as ones and ze­ros

What much of the nascent lit­er­a­ture tells us is that the ma­te­rial lo­cus of power in in­ter­na­tional mone­tary re­la­tions has been un­der­go­ing sig­nif­i­cant ex­pan­sion since the ad­vent of elec­tronic money. As the lo­cus has shifted and ex­panded to in­clude a mul­ti­tude of pre­vi­ously quar­an­tined forces, the power of cen­tral banks, de­fined in tra­di­tional terms of their con­trol and au­ton­omy, has been in rel­a­tive di­lu­tion.

In the back­ground, more­over, the digi­ti­sa­tion of money has ush­ered in new types of ma­te­ri­al­ity in re­la­tion to cur­rency, which ac­com­mo­date rad­i­cal al­ter­ations to the so­cial in­sti­tu­tions of money. With the ex­plo­sion of cryp­tocur­rency al­ter­na­tives to Bit­coin via the re­cent ad­vent of ICO’S (ini­tial coin of­fer­ing), these new types of ma­te­ri­al­ity ex­ploded in 2017.

The con­trol and au­ton­omy of cen­tral banks now ex­ists in the on­rush of this new ma­te­ri­al­ity, as does the tra­di­tional re­la­tion­ship be­tween the cen­tres of fi­nan­cial and po­lit­i­cal power in so­ci­ety. Some­thing of an in­flec­tion point has been reached. How did we get here?

A pro­found shift was set in mo­tion when money went dig­i­tal. For con­sumers in the US, Aus­tralia, and New Zealand, this en­tered the flow of ev­ery­day life when EFT­POS (Elec­tronic Funds Trans­fer at Point of Sale) and the as­so­ci­ated chipped cards and read­ers be­gan their accent to ubiq­uity around 2002.

By the mid­dle of the decade, EFT­POS and its in­ter­na­tional it­er­a­tions had be­gun to re­place notes and coins as the dom­i­nant meth­ods of pay­ment in de­vel­oped coun­tries, while newer con­tact­less meth­ods us­ing smart cards, mo­bile phones and mo­bile read­ers were quickly de­vel­op­ing. The im­pli­ca­tions of these trends for com­mer­cial bank­ing prac­tices and the cost/ben­e­fit trade­offs re­gard­ing ef­fi­ciency, se­cu­rity, mo­bil­ity, and anonymity for ven­dors and con­sumers have been widely dis­cussed.

On the other hand, for cen­tral banks and gov­ern­ments these trends marked a water­shed. The digi­ti­sa­tion of money and the growth of elec­tronic com­merce di­rectly spurred an ex­plo­sion of dig­i­tal eco­nomic data. Un­sur­pris­ingly, and made par­tic­u­larly acute in the post 9/11 era, that ex­plo­sion at­tracted a range of stake­hold­ers and forces pre­vi­ously only pe­riph­eral to the po­lit­i­cal or­bit of cen­tral banks. Dig­i­tal transactio­ns leave ‘fin­ger­prints’ able to be drawn upon, not only by eco­nomic ac­tors such as ad­ver­tis­ers and ven­dors seek­ing to un­der­stand con­sump­tion pat­terns, but for se­cu­rity-re­lated sur­veil­lance of both a do­mes­tic and in­ter­na­tional na­ture.

The first decade of the 21st cen­tury, as a re­sult, wit­nessed the un­prece­dented se­cu­ri­ti­sa­tion of fi­nance, and the ‘fi­nan­cial­i­sa­tion’ of se­cu­rity, even be­fore the global fi­nan­cial cri­sis of 2008. Ben­jamin Co­hen cap­tured the pre-cur­sive di­men­sions of this shift in 1998 with The Ge­og­ra­phy of Money, 2001 with the ar­ti­cle Elec­tronic money: new day or false dawn?, and 2004 with The Fu­ture of Money.

Co­hen con­cluded of these trends that the im­pact of elec­tronic money would be felt great­est by cen­tral banks whose ex­ist­ing ca­pac­ity to con­trol mone­tary

Some­thing of an in­fec­tion point has been reached

How did we get here?

sup­ply and au­ton­omy to man­age mar­ket de­mand was great­est. Clearly, cen­tral banks with lit­tle of these pow­ers would not stand to lose as much. He wrote in 2001,

“The an­tic­i­pated era of elec­tronic money… will have a pro­found im­pact on the ef­fec­tive­ness of mone­tary pol­icy – less so in coun­tries with weaker cur­ren­cies, where con­trol of ag­gre­gate spend­ing has al­ready been com­pro­mised by the ac­cel­er­at­ing de­ter­ri­to­ri­al­iza­tion of na­tional monies; def­i­nitely more so in the re­serve cen­tres, where do­mes­tic mone­tary mo­nop­o­lies will be se­ri­ously breached for the first time.” 4

At the heart of this im­pact was the ma­te­rial trans­for­ma­tion of fiat cur­rency from pa­per, poly­mer, and metal­lic prom­ises, to prom­ises com­posed of dig­i­tal strings of ones and ze­ros. Those prom­ises re­mained de­pen­dent on the col­lec­tive in­ten­tion­al­ity of hu­man be­ings for their sta­tus and func­tion as money, but their ma­te­ri­al­ity was trans­formed. 5 And where ma­te­ri­al­ity leads, col­lec­tive in­ten­tion­al­ity fol­lows. 6

This was not the pri­mary con­cern of Co­hen, how­ever. His anal­y­sis of the im­pacts of elec­tronic money re­mained fo­cused in the di­lu­tion of tra­di­tional mone­tary sovereignt­y by the swarm of new stake­hold­ers and net­works of cross-bor­der mar­ket ac­tors. 7

The ex­plo­sion in dig­i­tal data pre­cip­i­tated by the ad­vent of elec­tronic money and ex­panded by the dig­i­tal age of ubiq­ui­tous sen­sors, mo­bile de­vices, and hyper-con­nec­tiv­ity pales in com­par­i­son to what is yet to come.

More re­cent at­ten­tion em­a­nat­ing from the so­cial science of fi­nance, in­ter­na­tional po­lit­i­cal econ­omy, and in­ter­na­tional re­la­tions has ac­crued to the im­pacts of tech­nol­ogy and the ‘new ma­te­ri­al­ity.’ 8 These in­quiries raise the prospect that the new ma­te­ri­al­ity rep­re­sented by digi­ti­sa­tion, forces an in­side-out ex­am­i­na­tion of the so­cial in­sti­tu­tions of money and there­fore the ex­panded lo­cus of power in mone­tary re­la­tions. 9 Ex­plain­ing the ero­sion of state power over mone­tary re­la­tions, in terms of tra­di­tional hi­er­ar­chies sat­u­rated by com­plex­ity and se­cu­ri­ti­sa­tion, could only par­tially cap­ture the dy­nam­ics at work.

From big data to data crunch

The ex­plo­sion in dig­i­tal data pre­cip­i­tated by the ad­vent of elec­tronic money and ex­panded by the dig­i­tal age of ubiq­ui­tous sen­sors, mo­bile de­vices, and hyper-con­nec­tiv­ity pales in com­par­i­son to what is yet to come. An in­ter­netof-things (IOT) of con­nected de­vices is pre­dicted to num­ber from 25 to 50 bil­lion by 2020. This vi­sion an­tic­i­pates an ex­po­nen­tial in­crease in the amount of in­for­ma­tion gen­er­ated by de­vices, ap­pli­ca­tions, and the in­fra­struc­ture it­self that mea­sure, mon­i­tor, and au­to­mate tasks. A wealth of an­a­lyt­ics and fore­casts are avail­able.

Ac­cord­ing to Cisco, an­nual global in­ter­net traf­fic will reach 3.3 ZB10 per

year by 2021, up from 1.2 ZB in 2016 and most of it gen­er­ated by mo­bile de­vices con­nected via Wi-fi. Most of the traf­fic will be video, and the amount of video sur­veil­lance traf­fic will in­crease seven-fold. 11

This has be­come known as the com­ing ‘data crunch’. Man­ag­ing the flow of data, rather than own­ing and stor­ing it, will be­come the only op­tion for most busi­nesses and gov­ern­ments. 11 In­di­vid­u­als, too, are chang­ing their at­ti­tudes to­ward their own data, forc­ing the re­dun­dancy of the once ubiq­ui­tous ‘gather it now, find a use for it later’ model of the big data era. 13 Thus, the prove­nance over and se­cu­rity of data, and the ca­pac­ity to relay this to con­sumers in­creas­ingly con­cerned about trust, has be­come piv­otal to com­pet­i­tive sur­vival, let alone ad­van­tage.

Blockchain and ICOS

En­ter blockchain. Dis­trib­uted com­put­ing sys­tems have been with us for some time. The un­der­ly­ing pro­to­cols were present at the cre­ation of the early in­ter­net, form the ba­sis of the World Wide Web and telecom­mu­ni­ca­tions net­works, and any­thing that re­quires the uni­form syn­chro­ni­sa­tion of a net­work of com­put­ers to func­tion.

This uni­form syn­chro­ni­sa­tion is essen­tially a con­sen­sus be­tween ma­chines. As types of net­worked ma­chines, nodes in a dis­trib­uted ledger need to reach con­sen­sus about the con­tents of a canon­i­cal chain of blocks that con­tain data. In 2009, Bit­coin was the first ap­pli­ca­tion of dis­trib­uted ledger tech­nol­ogy (DLT) to transactio­ns and own­er­ship of cryp­tocur­rency, or dig­i­tal cur­rency in­ter­act­ing with cryp­to­graphic pro­to­cols.

In 2015, Ethereum em­barked on an am­bi­tious project to ex­pand on what many, in­clud­ing its cre­ator, Vi­ta­lik Bu­terin, saw as the sig­nif­i­cantly un­der­utilised po­ten­tial of blockchain. Rather than sim­ply record­ing transactio­ns and own­er­ship of a cryp­tocur­rency, Ethereum en­vi­sions it­self as a global gen­eral-pur­pose com­puter. Ethereum’s blockchain would be a record of the in­ter­ac­tions be­tween com­puter states. These in­ter­ac­tions are known as ‘smart con­tracts’ whose ex­e­cu­tion oc­curs on the un­der­ly­ing ar­chi­tec­ture. Ethereum is to Bit­coin what a smart phone is to a pocket cal­cu­la­tor.

Devel­op­ers can use Ethereum’s blockchain to ex­e­cute their smart con­tract. A novel way of fund­ing the de­vel­op­ment of such ap­pli­ca­tions has emerged in the form of ini­tial coin of­fer­ings. A de­vel­op­ment team will is­sue a cryp­tocur­rency of their own that can be bought and traded by the pub­lic. These ‘coins’ or ‘to­kens’ achieve their val­u­a­tion like any other se­cu­rity, via the mech­a­nism of sup­ply and de­mand.

Mil­lions of dol­lars have flooded the cryp­tocur­rency mar­ket very re­cently as in­vestors chase the next Bit­coin phe­nom­e­non. In 2017 Bit­coin’s price in­creased 1600 per cent be­tween Jan­uary and De­cem­ber, and Ethereum was up 4000 per cent in the same pe­riod. The mar­ket cap of cryp­tocur­ren­cies as a whole, is now more than a stag­ger­ing US$400 bil­lion.

The burst of highly spec­u­la­tive ICOS in the first half of 2017, which pushed up prices, was rapidly un­wound, as many projects were over-val­ued and in­vestors ran for the door, mostly into fiat also. Nat­u­rally, this snow­ball ef­fect caused the swathe of new and

Rather than sim­ply record­ing transactio­ns and own­er­ship of a cryp­tocur­rency, Ethereum en­vi­sions it­self as a global gen­er­alpur­pose com­puter…. Ethereum is to Bit­coin what a smart phone is to a pocket cal­cu­la­tor.

poorly in­formed in­vestors to panic. The in­dus­try is al­most com­pletely un­reg­u­lated. But this is only the be­gin­ning.

The ICO space looks des­tined to be reined in by reg­u­la­tors even­tu­ally, and the cur­rent crop of cryp­tocur­ren­cies will inevitably shrink from this ini­tial bloated size. The US Se­cu­ri­ties and Ex­change Com­mis­sion warned in July that it would cat­e­gorise ICOS as se­cu­ri­ties on a case-by-case ba­sis, thus sub­ject­ing them to fed­eral reg­u­la­tion. Chi­nese au­thor­i­ties placed a ‘ban’ on ICOS in Septem­ber. Ob­servers ex­pect Bei­jing to be­gin is­su­ing li­censes in lieu of an out­right ban in the fu­ture.

Reg­u­la­tors face a co­nun­drum be­tween the impulse to con­trol ac­tiv­ity in this space and the im­per­a­tive to cul­ti­vate in­no­va­tion. Perth-based Power Ledger held Aus­tralia’s first ever ICO in Septem­ber – rais­ing $34 mil­lion – a re­sound­ing suc­cess and an ex­em­plar that will be quickly im­i­tated. In Aus­tralia, ASIC re­leased guid­ance of its hope­fully bal­anced ap­proach to ICOS in Septem­ber.

A false dawn?

None of this, how­ever, her­alds the demise of the blockchain. Essen­tially a form of triple-en­try ac­count­ing, DLTS 14 en­able two or more ac­tors to ver­ify that some­thing hap­pened with a high de­gree of cer­tainty with­out the need for an in­ter­me­di­ary. Scep­tics watch­ing this cur­rent wave of volatil­ity have a ten­dency to be short-sighted.

In June, widely re­spected econ­o­mist and ed­i­tor-at-large of the Aus­tralian Busi­ness Re­view, Alan Kohler, la­belled Bit­coin a “gi­ant scam”. 15 The cur­rent crop of cryp­tocur­rency min­ers, Kohler ob­serves, “are hop­ing their ‘coins’ be­come money one day.” 16

Kohler notes the dis­tinc­tion be­tween cryp­tocur­ren­cies and blockchain tech­nol­ogy, on which he is bullish, but re­it­er­ates the essen­tially an­ar­chic na­ture of cryp­tocur­ren­cies and their destiny to never re­place the roles of the cen­tral banks and gov­ern­ments that print and man­age fiat money.

But to be bullish on blockchain, while dis­miss­ing the to­kens that will trig­ger the ex­e­cu­tion of smart con­tracts and cre­ate their own eco­nomic ecosys­tems, be­lies an in­con­sis­tency. Jamie Di­mon of J.P. Mor­gan has also re­peat­edly de­clared Bit­coin a “fraud”, while the in­sti­tu­tion he heads is a found­ing mem­ber of the En­ter­prise Ethereum Al­liance.

Ac­cord­ing to Jamie Burke of Out­lier Ven­tures, ICOS are the much sought af­ter “killer app” of blockchain tech­nol­ogy, hid­ing in plain sight. 17

They rep­re­sent bur­geon­ing eco­nomic ecosys­tems in their own right, herald­ing the “to­keni­sa­tion, frac­tion­al­i­sa­tion and fi­nan­cial­i­sa­tion of The Web 3.0 start­ing with how it’s owned.” 18

While start-ups in this space will nat­u­rally rise and fall, the ICO model of­fers a truly novel al­ter­na­tive to tra­di­tional ven­ture cap­i­tal. Teething phases not­with­stand­ing, the com­mu­ni­ties of in­ter­est that con­verge around a project via an ICO are able to evolve in a way un­avail­able to the VC pow­ered start-up. The dig­i­tal cryp­to­graphic to­ken can tether the com­mu­nity to the project long af­ter the VC is gone, the project iced, and the in­tel­lec­tual prop­erty and its net­work of in­di­vid­u­als dis­banded. Say­ing crypto-an­ar­chists just want to re­place money is like say­ing the in­ter­net’s in­ven­tors just wanted to re­place the let­ter­box.

Reg­u­la­tors face a co­nun­drum be­tween the impulse to con­trol ac­tiv­ity in this space and the im­per­a­tive to cul­ti­vate in­no­va­tion.

The dis­in­ter­me­di­a­tion of tra­di­tional forms of in­sti­tu­tional power is built into this sys­tem. Al­ready, fi­nan­cial in­sti­tu­tions, cor­po­ra­tions, and other pow­er­ful stake­hold­ers of every type – in­clud­ing gov­ern­ments – are join­ing forces to com­man­deer blockchain tech­nol­ogy for their var­i­ous ends. By stor­ing pri­vate data and keep­ing code closed-source, how­ever, they seek to re­pro­duce busi­ness mod­els of mo­nop­oly and scarcity. These con­sor­tiums are pur­su­ing pri­vate blockchain projects that are essen­tially a power re-cen­tral­i­sa­tion ex­er­cise. Yet they will be com­pet­ing in fu­ture with pub­lic blockchain­s that will ac­crue struc­tural ad­van­tages.

Ac­cord­ing to Nathan Wa­ters, “the net­work ef­fects of an open, pub­lic blockchain-based pro­to­col will inevitably out­pace any pri­vate sys­tems.”

19 Wa­ters and many oth­ers see this as the key paradig­matic shift many ob­servers are miss­ing. Mod­els of scarcity and mo­nop­oly are ill-suited to the dig­i­tal net­worked age. This ap­plies as much to com­mer­cial ac­tors as it does to the state, which as we have seen, has not been able to quar­an­tine its agency from these forces, even while in their in­fancy.

Dis­in­ter­me­di­a­tion with dis­ag­gre­ga­tion

His­tory sug­gests the state has been more than ca­pa­ble of com­man­deer­ing the dis­rup­tive ef­fects of tech­nol­ogy to its own ends. Few would be will­ing to draw a line in the sand this time around. But a more in­ter­est­ing ques­tion might be: What ex­actly is the state now?

With the ad­vent of elec­tronic money and the in­flux of com­plex­ity to its once quar­an­tined pre­serve, the re­la­tion­ship be­tween cen­tres of fi­nan­cial and po­lit­i­cal power in so­ci­ety has ex­panded in lo­cus, per­haps be­yond recog­ni­tion. Fi­nance has been se­cu­ri­tised and se­cu­rity has been fi­nan­cialised. The data crunch is here. The state is left herd­ing a sovereign swarm of lo­custs.

Blockchain tech­nol­ogy of­fers a foothold, a way to struc­ture the dig­i­tal do­main that of­fers ver­i­fi­ca­tion, stan­dard­i­s­a­tion, and se­cu­rity. In­ter­na­tion­ally, cen­tral banks from China, Rus­sia, Canada, Den­mark, Eng­land, Ja­pan and Sin­ga­pore are ex­plor­ing ways to use blockchain to is­sue con­trol­lable dig­i­tal ver­sions of le­gal ten­der. But in whose in­ter­ests? Are they un­wit­tingly in­sti­gat­ing their own demise if pub­lic blockchain-based economies will de­feat them with scale?

The IMF’S Chris­tine La­garde has also weighed in re­cently on cryp­tocur­ren­cies, warn­ing cen­tral bankers not to dis­miss them. The fu­ture of the IMF’S Spe­cial Draw­ing Right, the quasi-re­serve cur­rency backed by a bas­ket of the world’s ma­jor cur­ren­cies, could one day be ide­ally suited to a blockchain so­lu­tion that re­stores trust to the im­per­illed global fi­nan­cial sys­tem.

There’s some­thing else, too. Blockchain of­fers clean data – gold dust to Ar­ti­fi­cial In­tel­li­gence devel­op­ers. And big­ger is bet­ter. A pub­lic, per­mis­sion-less, global-scale blockchain serv­ing up end­less streams of ver­i­fi­able data is every AI de­vel­oper's dream. Ac­cess to good data is so im­por­tant to com­pound­ing AI learn­ing that a small ini­tial edge can be­come a sig­nif­i­cant ad­van­tage over time, ap­pli­ca­ble to al­most any­thing strate­gi­cally of in­ter­est to the state.

Ja­pan is the quiet achiever in the de­vel­op­ment and im­ple­men­ta­tion of blockchain, and the Pen­tagon an­nounced re­cently it would de­ploy its first AI sys­tem on the bat­tle­field by De­cem­ber 2017, to hunt ISIS as it dis­solves back into lo­cal pop­u­la­tions. AIS fed by blockchain-gen­er­ated data will be the strate­gic game-chang­ers of the near fu­ture.

Stan­dards Aus­tralia has led ef­forts to be­gin the process of reg­u­la­tion and stan­dard­i­s­a­tion in the blockchain space, and 129 AI patents were filed in Aus­tralia at the be­gin­ning of 2016.

So ve­hi­cle or vice of the state? Blockchain is just one com­po­nent of the ex­pand­ing techno-hy­brid lo­cus of power in which hu­man be­ings find them­selves now pre­car­i­ously sit­u­ated.

Mod­els of scarcity and mo­nop­oly are ill-suited to the dig­i­tal net­worked age. This ap­plies as much to com­mer­cial ac­tors as it does to the state


IM­AGE: © Jeremy Keith-flickr


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