What’s In a Blockchain?
Many of the technologies that capture our imagination do so long before they exist. Humans were fantasizing about space travel for millennia before man had the means to set foot on the moon. I grew up watching spy films in which wristwatches facilitated video calls. I don’t even need to get started on the role of robots and artificial intelligence in our collective imagination.
I would wager, however, that prior to a few years ago there were not all that many people who were daydreaming about peer-to-peer digital cash. With the exception of a small band of privacy activists, cypherpunks, and Neal Stephenson fans, it wasn’t a widely discussed idea. Since the inception of bitcoin, though, the idea has captured the public imagination in a way that precious few inventions are able to achieve.
One thing is for sure: the popularity of the technology in discourse is not due to the deep and widespread impact it has had on our lives. Cryptocurrencies have yet to find meaningful product-market fit. Decentralized applications languish with more developers building them than users engaging. This isn’t to say it will never happen. I am optimistic. But our collective imagination has gotten out over its skis.
Why, then? What is it about blockchain technology that so excites us? We would never talk about any other type of database technology this way, surely.
I think the hype, and the ensuing confusion about what a blockchain is good for, comes down to one thing: trust issues.
Brilliantly, but also confusingly, blockchain technology has been branded as “trustless”. Blockchains are “trust machines”. They “solve trust issues”. It is this idea that captures our hearts and minds. We don’t want to have to trust anyone. We don’t want to have to trust our counterparty to deliver on a trade.We don’t want to have to trust intermediaries to be reliable or not misuse our data. We don’t want to have to trust our banks, our governments, our boyfriends, our children. Wouldn’t it be nice, we think, if there was a neat solution that rendered all of these interactions and relationships as transparent and verifiable as a simple math problem.
The way blockchain technology gets talked about, this is what it purports to offer. This is why people want to apply it in so many ways and to so many areas (most of which don’t make sense). We want blockchains to prove that our market salad is actually certified organic and locally sourced. We want blockchains to create verifiable records of whether the dog-walker took Fido out. We want blockchains to ensure we don’t have to rely on a third party to send remittances home to our families.
Blockchains alone can’t solve these problems, though. A blockchain is not a meat grinder that takes complex interactions in one end and produces clean, legible, and verifiable computer code one the other. Indeed, to say blockchain technology “solves trust issues” is to overstate.
Trust is like energy. It cannot be created or destroyed. It can only be changed from one form to another.
Blockchains reorganize trust and change its form. They deconstruct the trust relationships that comprise our economic and social lives and rebuild them differently, but with no less trust involved. Even in the simplest use case that we have for the technology, sending funds without reliance on a third party or bank, we are still trusting the network. The code must be running and executing as promised. A sufficient number of participants in the network (miners) must be behaving honestly for it to work.
One of my deepest fears about this technology that has taken over our imaginations is that the “trustless” branding of blockchains works a little too well. I shudder to think what happens should we all be lulled into a false sense of security only to later learn that the system has not reduced the amount of trust we need to offer up, but only obfuscated it.