(So much for doing this daily… Lots to catch up on.)
Some great articles from the past few days that deserve attention:
An excellent comment from Patrick Murck in the Harvard Business Review looks at the concept of blockchain governance, and how it cannot be “added on” later – it needs to be part of the protocol.
“The blockchain is truly an innovative approach to governance for networks and machines. But we must resist the temptation to anthropomorphize code and misapply machine governance to social systems. Code is law for machines, law is code for people.”
I really liked his description of the ethereum hard fork: “akin to burning down the house to roast the pig”.
The “trust” part of governance is removed from the human part of the equation and embedded in the code:
“The power of blockchain technology is that it can algorithmically enforce private agreements and community principles at a global scale by shifting the cost of trust and coordination to the network. This is what allows blockchains to create new markets where they couldn’t exist before, whether for political or for economic reasons. To do this, we have to be able to trust the blockchain, and to trust that no one controls it.”
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The New York Times reported that bank lending in the US is stalling, largely due to lower demand for debt (as post-election optimism gives way to concern).
As bank quarterly results were released, we saw that Wells Fargo’s loans were up only 1% yoy, while Citigroup’s were up 2%.
“The results followed recent signs that lending has been slowing, and in some cases declining more broadly in the banking industry. Data from the Federal Reserve showed that lending in February was flat, while lending to manufacturers and energy companies was in decline, after many months of growth.”
Combine that with the resurgence of talks about Glass-Steagall, and banks must be feeling nervous about their bottom line.
Cue: even more fervent activity in blockchain testing.
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There has been a lot of exciting news on CoinDesk this week, which I’ll get to this weekend – meanwhile, this caught my eye:
Swift revealed more details of its blockchain test aimed at streamlining the nostro-vostro system, in which correspondent banks hold balances in local currencies on behalf of international banks. It makes cross-border payments possible, but at the cost of leaving money idle. And settlement time can be as much as weeks for complex transactions.
The proof of concept will be built on Hyperledger’s Fabric codebase, to leverage the existing GPI platform. On top of that the developers will layer smart contracts that could help to automate the transfer process.
Given that Swift moves daily almost 30 million payments messages, and given that it serves almost 11,000 financial institutions, the impact could be huge. Intriguingly exciting.
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Getting philosophical: I’ve always loved the Japanese art of kintsugi, making broken things that have been fixed even more beautiful than they were whole.
Now, if we can apply that to life – the bits of us that break end up making us more appealing….
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This is fascinating: a digital book that you can pass on to someone else only after you have changed it a bit. On each page, you have to take out two words and add one.
The idea is that after about 20 shares, it becomes unreadable.
In a curious twist, the changes are saved and tracked on a blockchain. I’m not sure which one.
It’s easy to say “but what’s the point?”… You could, I suppose, say that about most forms of art.
So, is this art? Why wouldn’t it be?