The Blockchain Is The New Corporation
Corporations, as we have seen, are devoting a larger share of capital to automation technologies within businesses across almost every type of industry and sector. Technological innovation, both by way of employee input and customer’s expected output, is undergoing a transformation. With blockchain technology, this is an organizational change that reassigns the role of the employee and customer outside the grasp of human intervention. Blockchain technology stands to radically transform our concept of the corporation where machines, not humans, are both the customers and employees.
Decentralized Autonomous Organizations
The World Economic Forum estimates that by 2027, 10% of global GDP will be stored on a blockchain network. In such a world, it will be clear that corporations are less reliant than ever upon humans to survive and prosper. Blockchain technology is the blueprint for a type of corporation that is light-years ahead of its 20th century predecessor in terms of resource allocation and communication methods.
20th century business models were characterized by ownership rather than access, and centralized over decentralized decision making. The bitcoin blockchain economic model does away with all these conventional notions and provides us a non-exclusive, decentralized, autonomous corporation. This type of corporate model is fundamentally different in its function because – among other things – it is independent of human intervention while simultaneously owned by no single party.
In the bitcoin economy, machines are the employees rather than as humans were in the industrial age. The role of the employee, and the producer of labour describes the network miner. In terms of the bitcoin mining function, the product of labour would be the hashing power necessary to solve the next block of transactions. The compensation for each employee? The network pays each node equal to the current block reward every time the miner finds this solution.
When we come to understand this shift in the makeup of the corporation, we see that the core of its function has undergone a significant change. The blockchain network concept is such an altering framework for conducting business, that it shakes the very foundations of what we believe to be a legitimate corporation. Truly, the blockchain network concept represents a milestone in technology innovation.
Employees are now considered machines in the information age rather than as humans were in the industrial era and beyond. Further, customers are now humans, but soon to be machines as well with the implementation of self-executing smart contracts.
Uncheatable Smart Contracts
Networks of smart contracts have empirical objectives. That is, they’re functionality will be understood through examination of the source code which it operates by. As it applies to smart contracting systems of the future, open-source systems make for an entirely transparent and uncheatable form of governance. The instances of misuse will come from failing to understand the objectives of the contract or network.
It is crucial that we note the computing revolution is well past an inflection point. When such technologies first began being used in universities and large organizations, they were under the control of many, many humans who all shared one machine. With bitcoin, we have one large, interconnected computer network which controls many, many human counterparts. More importantly, it administers one of the most precious aspects of our lives – financial livelihood. An exact reversal of how the computing revolution began is characterized by an inflection point of control which has recently passed. First we shape our tools, thereafter our tools shape us.
Once the machine thinking method has started, it would not take long to outstrip our feeble powers. … At some stage therefore we should have to expect the machines to take control ….
– Alan Turing, Intelligent Machinery, A Heretical Theory, 1951
You can be certain that, just as one computer would work for many humans in times past, many humans will come to work for one main network of machines. Computer technology is capable of achieving this dominance because it rewrites the laws of society with something based on mathematics and science rather than steel and paper.
The blueprint of blockchain technology represents an important milestone in computing innovation – one which allows digital systems, whether they be for commerce or communication, to operate independently from conventional forms of law.
As is with the current landscape of bitcoin today, the miners are the employees of the corporation. Mere years ahead however, lies a paradigm where smart contracting begins to populate the role of customer as well.
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