Finding Trust Through The Blockchain

samson-creative-91091-unsplash.jpg

Blockchain is honest and unemotional. It is decentralized, autonomous, and has no loyalty to any nation or organization. "generic definition of a blockchain: a distributed, append-only ledger of provably signed, sequentially linked, and cryptographically secured transactions that's replicated across a network of computer nodes, with ongoing updates determined by a software-driven consensus." - Michael J. Casey, The Truth Machine: The Blockchain and the Future of Everything This means that it is the perfect tool to do business. It takes the power of those who are corrupt or greedy and puts at least some of that power into the hands of the people.

There is a great deal of corruption and special interest groups in the global economy. Some states do not get along, and there are trade wars, and there are tariffs, and lastly, There exists a level of fraud and distrust when completing transactions today.

As a result, this makes it very hard to conduct trade where there is a mutual benefit for both parties involved. If you know anything about trade and macroeconomics, you know that through competitive advantages and trade nations and enterprises become wealthier.

But what if we utilized new technologies to better instill trust, and make transactions between two parties that don't trust each other go much smoother. "Their model showed that if we can resolve our trust issues with technology and give people confidence to transact, those people are willing and able to go into direct exchanges with complete strangers. These ideas are setting us on a path to a peer-to-peer economy." - Michael J. Casey, The Truth Machine: The Blockchain and the Future of Everything

Trust

However, distrust makes it very hard for us to cooperate and build something of greater value than we could on our own. But, if we were to use blockchain, we would have what is called a ledger, and it would be secure and impartial. This would mean that all financial and activities would be recorded and stored on a decentralized and unbiased network of nodes. This would, at the very least, give back some level of trust that is greater than what we had before.

This trust would, in turn, make transactions more accessible and more efficient meaning we could be more productive and cooperative. "Trust—particularly trust in our institutions—is a vital social resource, the true lubricant of all human interaction." - Michael J. Casey, The Truth Machine: The Blockchain and the Future of Everything

This quote sums it up nicely. There is no reason to forgo a tool that would make us wealthier. In fact, according to Michael J. Casey blockchain could become a tool to greater enhance trust between two or more parties engaging in a transaction. "The best way to think about blockchain technology, then, is not as a replacement of trust—as a "trustless" solution, as some cryptocurrency fanatics damagingly describe it—but as a tool upon which society can create the common stories it needs to sow even greater trust, to build social capital, and to forge a better world."

Completely taking humans out of the equation and adding a more significant amount of accountability for both parties. It could act as a form of checks and balances fostering more significant opportunities for those doing business.

Reforming Corrupt Financial Systems

Whether it be governments or reckless lending by banks, they are often found to be the culprit behind economic collapse and financial crises. For example, Greece and the Euro Crisis or Lehman Brothers and Financial Crisis of 2008. "Just consider this: control of a currency is one of the most powerful tools a government wields; ask anybody in Ireland, Portugal, Greece, or Cyprus who lived through those countries' recent financial crises. Bitcoin promises to take at least some of that power away from governments and hand it to people. That alone augurs significant political, cultural, and economic clashes." - Paul Vigna, The Truth Machine: The Blockchain and the Future of Everything

However, blockchain could change this with more accountability and less power for institutions. The ledger is what captures data and displays it. It does this in the form of debits and credits much like an accounting ledger which is used to keep companies honest about their business activities.

It could do this better though by taking human error and fraud out of the equation if it were retooled correctly for this purpose. "We have an opportunity to reform the financial system, to turn it into the public utility that it's supposed to be—a level playing field that everyone can indiscriminately use in their bid to get ahead. Let that be the standard for the coming age of cryptocurrency." - Paul Vigna, The Truth Machine: The Blockchain and the Future of Everything

Conclusion

The current system of trade, governments, and enterprise is flawed. Whether it be through corruption or poorly informed decisions, the system has a lot of room for improvements. While it still may be a long way out, we have building blocks to improve and better the way we keep records, do trade, and hold institutions as well as individuals accountable.

Blockchain has given us an exciting glimpse into what the future holds for these aspects of the global economy. There will undoubtedly be growing pains, but it is more likely than not that with this new technology would be looking at a much more prosperous and cooperative future.

This is not just about us but also about laying the groundwork for future generations to build upon the foundation we are laying now.