How the Blockchain Will Radically Transform the Economy

Bettina Warburg, a researcher, educator, and entrepreneur, describes how the blockchain will eliminate the need for centralized institutions like banks or governments to facilitate trade, evolving age-old models of commerce and finance into something far more interesting: a distributed, transparent, autonomous system for exchanging value.

Warburg opens by explaining that the blockchain is actually a  continuation of human behavior to lower uncertainty about one another so that we can exchange value. At the beginning of human history we established informal rules that were enforced by the strongest. Then as institutions became more complex we created increasingly more formal institutions like constitutions and banks. Now we are currently creating online institutions which requires an evolved way of thinking about exchanging value.

Say hello to the decentralized economy — the blockchain is about to change everything. In this clear explainer of the complex (and confusing) technology, Bettina Warburg describes how the blockchain will eliminate the need for centralized institutions like banks or governments to facilitate trade, evolving age-old models of commerce and finance into something far more interesting: a distributed, transparent, autonomous system for exchanging value.

Platform marketplaces like Amazon, eBay, Alibaba now act as “middlemen to facilitate human economic activity,” but blockchain technology has the ability to “collapse institutions and enforcement” to return the economic power to people.

“While blockchain technology is relatively new, it’s also a continuation of a very human story, and the story is this: As humans, we find ways to lower uncertainty about one another so that we can exchange value,” she said.

Warburg clarified that although blockchain isn’t the solution to everything, it gives “us the technological capability of creating a record of human exchange, of exchange of currency, of all kinds of digital and physical assets, even of our own personal attributes, in a totally new way.”