3 Essential Takeaways From The MIT-Microsoft Bitcoin Talk
Growing bitcoiners, explaining Bitcoin’s potential to laymen, and Bitcoin and community spaces.
Preface. At the end of July, Microsoft NY and MIT Media Lab presented “Blockchain For Social Good”, a fantastic talk explaining Bitcoin and its role in social change.
I’ve never listened to a group of passionate people so perfectly explaining Bitcoin and its potential. Here are 3 essential takeaways for the Bitcoin community.
#1 — Growing Bitcoiners
John Paul Farmer of Microsoft NY introduced the talk by explaining his take on the different levels of Bitcoin enlightenment. What I particularly liked was how he detailed the philosophy required to get someone from stages 1 to 4, in effect how to cultivate a Bitcoin evangelist.
- Nonbelievers—this is crazy, digital monopoly money, backed by nothing!
- Sideliners— there are lots of smart people talking about this, maybe I should pay some attention, although I still don’t get it.
- Interested — I’m starting to understand Bitcoin’s value and what its features actually mean (P2P, decentralised, etc.), I want to learn more.
- Nirvana — let’s change the world.
If we want to turn people from nonbelievers to sideliners, we show them social proof — they’re much more likely to believe it has integrity and legitimacy if a company they trust does. And it’s not hard — I’ve been stockpiling the headlines as they come: Overstock, Microsoft, Bank of England, Visa…
They’re much more likely to believe it has integrity and legitimacy if a company they trust does.
To get them from waiting on the sidelines to being interested, Farmer said “it’s best to pique people’s curiosity through examples that are happening today”. And at this moment, it’s the part we’re working on the hardest. We’ve come a long way from just being that ‘drug currency’ — Bitcoin is spreading its roots into international money transfer, digital asset management, identity management, the list goes on…The key is finding the appropriate example among this plethora of projects.
“It’s best to pique people’s curiosity through examples that are happening today”
2# — Making the perfect analogy of Bitcoin fundamentals
Later, Brian Forde (MIT) delivered his startlingly simple explanation of Bitcoin and the problem of the double-spend, using very simple to understand visual analogies of texting. Below I’ve adapted his speech into written form, all the credit for the clarity is definitely Brian’s.
What is Bitcoin?
So we’ve got our banks. And around our banks, we’ve got services like Paypal, Venmo, Square etc. I can send money to other people who use my bank, but between banks it’s pretty slow and costs some money. And to arbitrary strangers on the Internet, well then we get organisations like VISA joining the picture, who come with 3% fees and their own set of rules and restrictions.
Bitcoin improves upon this by making it purely peer-to-peer — what does that mean? That means I don’t have to use a 3rd party. They’re cut out of the picture. To do that, it solves an interesting problem of the double spend. What is a double spend?
What makes digital currency hard?
Well the beautiful thing about digital docs like photos is that you can share them. So if I take a great pic, I can text it to a couple of my friends, post it on Instagram, Facebook, Tumblr etc. and it will be shared instantly around the world— not only that, it didn’t cost me anything to share with so many people, on so many different platforms. That’s the nature of the digital world.
Now, dollar bills. If I text it to another friend, then I text it to a second friend, then a 3rd, a 4th, a 5th, then I put it on Instagram, that doesn’t mean that I can create $10, $100, a thousand dollars. So what Bitcoin does, is it eliminates the double spend for digital assets.
“What Bitcoin does, is it eliminates the double spend for digital assets.” — Brian Forde
What makes this solution ridiculously cool?
What does that mean? Well now I can do Assets-over-IP (IP — the protocol of the Internet). I can transfer the ownership of something digitally that I have and you can validate that I don’t own it anymore. What’s an example that’s not money? Concert tickets!
Nowadays you go on Craigslist or Facebook and you go buy your ticket and try and buy it, and you’ll get the PDF, and you hope and pray that the person didn’t send it to 5 or 10 different people, and you hope that it’s not a scam. And then when you get to the gate, it’s sort of a gamble to see whether you’ve been cheated or not.
What the Bitcoin blockchain (the bricks beneath Bitcoin) does is that it validates that you are the actual owner, the other party no longer owns it, and that they didn’t sell it to any other person. And as we’ve seen, it’s not just for money, it can be for any type of asset as well.
And so what that creates is peer-to-peer trust. You can work with people without intermediaries like Uber, who traditionally have been there to establish trust. No longer do you need these third party brokers who establish trust, which could get interesting because we’ve never had that before.
“No longer do you need these third party brokers who establish trust, which could get interesting because we’ve never had that before.”
So if we think about it, the protocols that we use, they’re all built upon this communications protocol which is the Internet Protocol. You’ve got the Web which is on HTTP, email on SMTP, gaming, Skype. And they all interoperate and work on various platforms because we have standards.
And if you think what the world wide ledger / blockchain is doing, it’s a foundational technology like IP. You can transfer money, you have an identity, a reputation and there’s this open marketplace.
Now if you think of this, that’s actually the eBay stack. It’s also the Uber stack, and the AirBnB stack. And you start to think — isn’t it weird that I’m kind of locked-in to this one marketplace? I have interoperable email yet when when I log out of Uber and into eBay my reputation doesn’t follow me? What if you could just raise your hand and say — hey look I’m an Uber driver, I’ve been validated by this many people, I’ve been background checked, and it doesn’t matter which platform you’re on, you can show this. This is the sort of innovation and disruption that Bitcoin can enable.
#3 — Community applications of Bitcoin
The last takeaway I wanted to mention was from the talk by Ann Kim from IDEO, which showed some distinctly more community-oriented usages of Bitcoin. I thought this was really nice to see for a change, a non-financial oriented application.
One idea they were working on at the Bits+Blocks Lab were self-sustaining systems. In particular, she discussed an idea in which they would give a community bicycle its own Bitcoin address, and people could donate to the bike and it would earn bitcoins to maintain a budget to upgrade itself
Another example was the Dandelion prototype:
So what they did was, they went out and identified a park where there could be a new playground structure and asked, could this playground have its own Bitcoin address? Would people donate more frequently if it was easier and cheaper, rather than having to go home and login to a website. And with this, you can start thinking of new digital interactions — when I actually contribute a small amount of money, I can see the image of this new playground filling in … it’s about becoming more closely connected to the urban spaces around us.
And in a way I can see how Bitcoin can make our spaces more alive— it brings what was traditionally analogue, like money and trust, and fuses it into the digital world.
Finishing bits
You’ll know that if you think it’s just for the transfer of money that’s like thinking the Internet is just for email.
If you said five years ago, ‘cloud computing’’ or cloud, people would’ve said why do I need that, I have my USB. But now we have Dropbox. And so, “we don’t have a killer app for the blockchain yet”—but we have some apps that are starting to get there. Our job is to find them!
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