A lot has been said about how blockchain may spark a technological revolution across every corner of the economy – not only in finance, but also areas such as medicine, marketing and supply chain management. What is less clear is how it could pose a hefty social challenge as well.

2 minute read

Tech-enabled trends such as social networking, the sharing economy and crowdfunding all rest on three basic levels of trust: trust in the idea; trust in the platform; and trust in other users. Blockchain – the world’s first distributed trustless consensus algorithm behind cryptocurrencies – reduces that convention of building and managing trust a step further.

Users still need to trust the idea and the platform, but they no longer need to trust other users. The process making this possible is far too complex to detail here, but essentially connects existing and new concepts in both technical and social disciplines, as shown in the Venn diagram below.

Whether society is ready for such a change remains to be seen. If you believe the anarchists, decentralising trust is the answer. However, the battle over where we place our trust is intensely political, as indicated by the global attempts to regulate – and even co-opt – cryptocurrency exchanges, chipping away at one of its main advantages around decentralisation. Don’t give up on our innate reliance on institutions and norms to create our trust frameworks just yet.

Blockchain

What’s behind blockchain technology?

Source: @unchainedcap (Unchained Capital), 2019

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