How the blockchain will radically transform the economy | Bettina Warburg

How the blockchain will radically transform the economy | Bettina Warburg


Economists have been exploring
people’s behavior for hundreds of years: how we make decisions, how we act individually and in groups, how we exchange value. They’ve studied the institutions
that facilitate our trade, like legal systems, corporations, marketplaces. But there is a new,
technological institution that will fundamentally change
how we exchange value, and it’s called the blockchain. Now, that’s a pretty bold statement, but if you take nothing else
away from this talk, I actually want you to remember that 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. Now, one of the first people
to really explore the idea of institutions as a tool in economics to lower our uncertainties
about one another and be able to do trade was the Nobel economist Douglass North. He passed away at the end of 2015, but North pioneered what’s called
“new institutional economics.” And what he meant by institutions
were really just formal rules like a constitution, and informal constraints, like bribery. These institutions are really the grease that allow our economic
wheels to function, and we can see this play out
over the course of human history. If we think back to when we were
hunter-gatherer economies, we really just traded
within our village structure. We had some informal constraints in place, but we enforced
all of our trade with violence or social repercussions. As our societies grew more complex and our trade routes grew more distant, we built up more formal institutions, institutions like banks for currency, governments, corporations. These institutions
helped us manage our trade as the uncertainty
and the complexity grew, and our personal control was much lower. Eventually with the internet,
we put these same institutions online. We built platform marketplaces
like Amazon, eBay, Alibaba, just faster institutions
that act as middlemen to facilitate human economic activity. As Douglass North saw it, institutions are a tool
to lower uncertainty so that we can connect and exchange
all kinds of value in society. And I believe we are now entering a further and radical evolution of how we interact and trade, because for the first time,
we can lower uncertainty not just with political
and economic institutions, like our banks, our corporations,
our governments, but we can do it with technology alone. So what is the blockchain? Blockchain technology
is a decentralized database that stores a registry
of assets and transactions across a peer-to-peer network. It’s basically a public registry of who owns what and who transacts what. The transactions are secured
through cryptography, and over time, that transaction history
gets locked in blocks of data that are then cryptographically
linked together and secured. This creates an immutable,
unforgeable record of all of the transactions
across this network. This record is replicated
on every computer that uses the network. It’s not an app. It’s not a company. I think it’s closest in description
to something like Wikipedia. We can see everything on Wikipedia. It’s a composite view that’s constantly
changing and being updated. We can also track those changes
over time on Wikipedia, and we can create our own wikis, because at their core,
they’re just a data infrastructure. On Wikipedia, it’s an open platform
that stores words and images and the changes to that data over time. On the blockchain, you can think of it
as an open infrastructure that stores many kinds of assets. It stores the history of custodianship, ownership and location for assets like
the digital currency Bitcoin, other digital assets like a title of ownership of IP. It could be a certificate, a contract, real world objects, even personal identifiable information. There are of course other
technical details to the blockchain, but at its core, that’s how it works. It’s this public registry
that stores transactions in a network and is replicated so that it’s very secure
and hard to tamper with. Which brings me to my point of how blockchains lower uncertainty and how they therefore promise
to transform our economic systems in radical ways. So uncertainty is kind of a big term in economics, but I want to go through three forms of it that we face in almost all
of our everyday transactions, where blockchains can play a role. We face uncertainties
like not knowing who we’re dealing with, not having visibility into a transaction and not having recourse
if things go wrong. So let’s take the first example,
not knowing who we’re dealing with. Say I want to buy
a used smartphone on eBay. The first thing I’m going to do
is look up who I’m buying from. Are they a power user? Do they have great reviews and ratings,
or do they have no profile at all? Reviews, ratings, checkmarks: these are the attestations
about our identities that we cobble together today and use to lower uncertainty
about who we’re dealing with. But the problem is
they’re very fragmented. Think about how many profiles you have. Blockchains allow for us
to create an open, global platform on which to store any attestation
about any individual from any source. This allows us to create a user-controlled portable identity. More than a profile, it means you can selectively reveal the different attributes about you that help facilitate trade or interaction, for instance that a government
issued you an ID, or that you’re over 21, by revealing the cryptographic proof that these details exist
and are signed off on. Having this kind of portable identity around the physical world
and the digital world means we can do all kinds of human trade in a totally new way. So I’ve talked about how blockchains
could lower uncertainty in who we’re dealing with. The second uncertainty that we often face is just not having transparency
into our interactions. Say you’re going to send me
that smartphone by mail. I want some degree of transparency. I want to know that the product I bought
is the same one that arrives in the mail and that there’s some record
for how it got to me. This is true not just
for electronics like smartphones, but for many kinds of goods and data, things like medicine, luxury goods, any kind of data or product
that we don’t want tampered with. The problem in many companies, especially those that produce
something complicated like a smartphone, is they’re managing
all of these different vendors across a horizontal supply chain. All of these people
that go into making a product, they don’t have the same database. They don’t use the same infrastructure, and so it becomes really hard to see
transparently a product evolve over time. Using the blockchain, we can create a shared reality
across nontrusting entities. By this I mean all of these nodes in the network
do not need to know each other or trust each other, because they each have the ability to monitor and validate
the chain for themselves. Think back to Wikipedia. It’s a shared database, and even though it has multiple readers and multiple writers at the same time, it has one single truth. So we can create that using blockchains. We can create a decentralized database
that has the same efficiency of a monopoly without actually creating
that central authority. So all of these vendors,
all sorts of companies, can interact using the same database
without trusting one another. It means for consumers,
we can have a lot more transparency. As a real-world object travels along, we can see its digital certificate
or token move on the blockchain, adding value as it goes. This is a whole new world
in terms of our visibility. So I’ve talked about how blockchains
can lower our uncertainties about identity and how they change
what we mean about transparency in long distances and complex trades,
like in a supply chain. The last uncertainty that we often face is one of the most open-ended,
and it’s reneging. What if you don’t send me the smartphone? Can I get my money back? Blockchains allow us to write code, binding contracts, between individuals and then guarantee
that those contracts will bear out without a third party enforcer. So if we look at the smartphone example,
you could think about escrow. You are financing that phone, but you don’t need to release the funds until you can verify
that all the conditions have been met. You got the phone. I think this is one
of the most exciting ways that blockchains lower our uncertainties, because it means to some degree we can collapse institutions
and their enforcement. It means a lot of human economic activity can get collateralized and automated, and push a lot of human
intervention to the edges, the places where information moves
from the real world to the blockchain. I think what would probably
floor Douglass North about this use of technology is the fact that the very thing
that makes it work, the very thing that keeps the blockchain
secure and verified, is our mutual distrust. So rather than all of our uncertainties slowing us down and requiring institutions like banks, our governments,
our corporations, we can actually harness
all of that collective uncertainty and use it to collaborate and exchange
more and faster and more open. Now, I don’t want you
to get the impression that the blockchain
is the solution to everything, even though the media has said
that it’s going to end world poverty, it’s also going to solve
the counterfeit drug problem and potentially save the rainforest. The truth is, this technology
is in its infancy, and we’re going to need to see
a lot of experiments take place and probably fail before we truly understand
all of the use cases for our economy. But there are tons of people
working on this, from financial institutions to technology companies,
start-ups and universities. And one of the reasons is
that it’s not just an economic evolution. It’s also an innovation
in computer science. Blockchains give 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. So in some ways, they become a technological institution that has a lot of the benefits of the traditional institutions
we’re used to using in society, but it does this in a decentralized way. It does this by converting
a lot of our uncertainties into certainties. So I think we need to start
preparing ourselves, because we are about to face a world where distributed, autonomous institutions have quite a significant role. Thank you. (Applause) Bruno Giussani: Thank you, Bettina. I think I understood that it’s coming, it offers a lot of potential, and it’s complex. What is your estimate
for the rate of adoption? Bettina Warburg: I think
that’s a really good question. My lab is pretty much focused on going the enterprise
and government route first, because in reality,
blockchain is a complex technology. How many of you actually understand
how the internet works? But you use it every day, so I think we’re sort of facing
the same John Sculley idea of technology should either be
invisible or beautiful, and blockchain is kind of
neither of those things right now, so it’s better suited
for either really early adopters who kind of get it and can tinker around or for finding those best use cases like identity or asset tracking
or smart contracts that can be used at that level
of an enterprise or government. BG: Thank you. Thanks for coming to TED. BW: Thanks. (Applause)

Danny Hutson

100 thoughts on “How the blockchain will radically transform the economy | Bettina Warburg

  1. Very informative, if anyone wants to get into cryptocurrency space please follow me to this link https://office.fxtradingcorp.com/signup/125183r8hcamltci

  2. Blockchain technology has enormous potential. Companies around the world are already developing many new and innovative use cases for blockchain. But I am afraid that lots of businesses are not ready for this "huge move". I have heard about the new blockchain project that aims to help companies with the adaptation of blockchain-based solutions in business. Maybe such a project like PrimeStone  is a chance for businesses not prepared for this change but still eager to implement blockchain technology.

  3. Hmm… https://chrome.google.com/webstore/detail/threelly-ai-for-youtube/dfohlnjmjiipcppekkbhbabjbnikkibo

  4. To expand the areas we are involved in, we need to rely on something reliable in the new area. But, it is time-consuming to evaluate human beings and trust them. There are many gaps: cultures, generations, conflict of interests etc. Therefore, more globalized the world is or more new innovations change our lives, people tend to need faster and more objective ways to rely on. I think this can be blockchains.

  5. Almost everyone with access to the internet has heard of Bitcoin, the first application of blockchain technology to gain worldwide recognition. Some have even mistaken the two for synonyms.

    While Bitcoin led the recognition of cryptocurrencies and even went on to be accepted by various businesses around the world, blockchain itself has benefits far beyond facilitating payments.

    Anyways, read the below. This might help.

    https://www.namasteui.com/5-ways-blockchain-technology-can-benefit-your-business/



    Regards,

    Sourav Basak

    Namaste UI

  6. This is the Birth of the mark of the beast Blockchain and A.I. will rule humanity. When this technology goes mainstream, because blockchain and A.I. will, it will be incorporated to our bodies and we will be at last, one with they system we created. We will serve it as a slave, as it knows everything and everyone. This dynamic duo, that we have created, will be the one world government, United by A.I. and Blockchain & consciousness.

  7. Let's try FIATO app – it's from Kryptono ! too convenient, I can transfer coin easily only by QR code but all is safe. In addition, I can convert to fiat, such an great app, here is link https://fiato.kryptono.exchange/

  8. Wikipedia is on it way to blockchain, work in progress within EOS blockchain. Everyone is so excited in blockchain but lack of knowledge that we are setting up a trap for us to sink into Metric type of Cyborg assimilate or die condition sooner.

  9. The free and fully democratic encyclopedia decides to build it's new system on the most centralized and shady cryptocurrency ever. EOS is pure oligarchy, Tron is the same; Ripple, Dash and VeChain are basically corporations that are making their profit by creating and licensing their blockchains…

  10. Well, good introducing to distributing leger tech. BUT Wikipedia should be implemented on a blockchain itself, so it would realy become decentralized.

  11. The problem with blockchain is, everything you do is stored on the blockchain. You can never hide anything on the block chain.

  12. "Blockchain is a place where all your transactions are visible to everybody." Sound like a smart phone, only worse.

  13. From what I understand, blockchain itself is not decentralized it's just a ledger, the network that it runs on can be centralized or decentralized. This is just from what I understand, so I could be wrong!

  14. The "FIRST" Multi-Trillion dollar company is here: @… @…

    @ KBC & KCB Coin will merge in October 2019 to form the world's first "GOLD STANDARD COIN" @!!!

    Billionaire Josep Heit invested a billion of his own money into Karatbars Universe because he sees "ONE" GSC coin being worth an ounce of gold by 2021…

    By the way, the world's FIRST* BlockChain Smartphone is also in PRE-ORDER stage as well…Please feel free to contact me if you need
    more info…

    Watch the amazing promotional video to see its amazing features: @

  15. A bit of a rant… All these blockchain proponents make me think of a (dystopian) future where the only real commodity is building and selling data storage devices to store all the crypto blockchains of our primary economic activity of building and selling data storage devices…

    Have none of the blockchain proponents ever even considered the sustainability and the usage in perpetuity of this indefinitely growing burden of data? Database 'sharding' just divides the burden, but not the ever growing chain of blocks which MUST be stored within a single data storage pool/domain.

    IMHO, the concept of storing each transaction (millions per day; tens or even hundreds of thousands per minute) in this way seems rather short-sighted to me. It's the main thing keeping me away from the blockchain ideal – we can't store all of it forever. It's architecture is fundamentally flawed. Pump 'n' dump away, but I wouldn't rely on it.

    Rant over 🙂

  16. Blockchain is far too complicated and only benefits a few intelligent minors within the network. Designed for the rich to get richer by doing hardly any work.

  17. I hate Ali Baba. I bought a cell phone there. It was broken and they NEVER gave me my money back. It is a nest of thieves. They don't deserve even to be mentioned.

  18. Ai created Bitcoin according to many …blockchain feeds Ai its data, so your new master is AI…good luck! https://www.youtube.com/watch?v=I27jkERYO3M

  19. Bitcoin is undoubtedly the king of crypto’s. No one need doubt. Blockchain will transform the world. No one need doubt. Bitcoin has no ceiling. Forget the price gyrations, get-on board, hodl and forget. You’ll never regret it. No one need doubt.

  20. I love Bitcoin. I been involved since 2009. But I couldn't hear anything she said. That girl is smoking hot!

  21. I love the world of block-chain. However, who owns block-chain and is their a backdoor to this "autonomous" anonymous system. Just because banks are owned by the state or whoever, it does not mean Block-chain or Cryptocurrencies are self inventing and developing systems. Someone created them and is the "Central Bank" of them.

  22. Her name is Warburg.. What would she know about value. Warburgs are the 1% of the 1%.. Blockchain isn't an institution and it's our job to make sure it never becomes one

  23. Hello there. Collapsing Banks, Corporations and Institutions would unleash a Tsunami on today’s financial world.

  24. Good day everyone!! It so amazing i couldn't believed this until i cash out $40,000 hack transfer from this contact +1845-293-3085 just to start up a new life

  25. A friend of mine referred me to an hacker that is able to violate informative system on PayPal He added $6,000 to my account,he's reliable and fast You can contact him +1845-293-3085

  26. There lots of disclaimers out there QIAUG the magic finger suprised me with reliable paypal hack WhatsApp him via +1845-293-3085

  27. Don't miss this offer and great opportunity you have and you will never regret working with a great and intelligent hacker. WhatsApp:+18452933085

  28. YouTube is a place to find genuine hacker right? You are probably not hearing this for the first time that QIAUG does quality hackswhatapp +1845-293-3085

  29. Thanks a lot for the hack you processed into my wallet, I just received 1.4btc few hours after I contacted Qiaug for their crypto doubler programme. Text / WhatsApp +1845-293-3085

  30. There are lots of Disclaimer out there but this genius from QIAUG he made me believe Hacking is Real and legit Contact him on WhatsApp +1845-293-3085 for fast and Reliable hacks.

  31. i really hope what she is saying becomes real, cause i lost a lot in coins and now i am hoping to get it back with telecoin

  32. Beowulf Is Changing the Computing Paradigm Towards Decentralized Ownership, for more details, please visit here: https://thecryptosight.com/beowulf-is-changing-the-computing-paradigm-towards-decentralized-ownership/

  33. Blockchain has already been influencing various sectors, and still, it is just the beginning. Most visible it is in the sphere of money – blockchain is transforming the whole idea of money and payments, taking it to a totally different stage. We have a lot of coins trying to get the leading role and to become the main tender. Not only such well-known currencies like ETH or BTC have a chance to influence the world, but also those new, emerging coins like PSC may surprise all users around the world.

  34. The concept of blockchain is great, unfortunate NOTHING has proved unhackable in the technology age. https://www.technologyreview.com/s/612974/once-hailed-as-unhackable-blockchains-are-now-getting-hacked/
    Oh another note, I hope this Bettina Warburg is not a relative of Paul Warburg the creator of the Federal Reserve…

  35. Aside from the problems of greed and bubbles waiting to burst, there is a very real, very insidious side to Bitcoin that Christian investors should think about very carefully. It is becoming increasingly evident that ISIS and other terror groups are exploiting Bitcoin to fund their massive budgets and evil purposes. Just recently a woman was arrested and charged with laundering $85,000 through Bitcoin and other cryptocurrencies to the Islamic State. Zoobiah Shahnaz, age 27 from Long Island, allegedly used 16 credit cards (which she had obtained by fraudulent methods) to purchase $63,000 in Bitcoin and other cryptocurrencies, in addition to $22,500 she was able to acquire through a loan from a Manhattan bank. Shahnaz was detained by federal agents at JFK International Airport as she was attempting to board a flight to Syria to join ISIS in person. And she is not the only one. In fact, a prominent pro-ISIS blog which is used to recruit and train terrorists, explains to readers how Bitcoins can be used to fund the Islamic State’s detestable activities without being traced by Western “Kafir” governments. God only knows how much of the hundreds of billions of dollars currently in Bitcoin is supporting the most blatantly evil organization on the face of the planet.
    Of course, terrorists can use any kind of currency to fund their atrocities. But Bitcoin is designed with the specific purpose of being completely anonymous, untraceable and detached from any government or law enforcement protections. The black market loves Bitcoin. Bitcoin may be the closest thing to blood money the world has ever seen.

    No doubt the astronomical price returns on Bitcoin over the past years is very tempting to investors everywhere. I mean, who wouldn’t like to turn $100 into over four million dollars in just a few years? Let me say that again. This time let it really sink in… $100 into over four million dollars in just a few years. Does anybody else hear warning bells in that sentence, or is it just me? Well, King Solomon might have something to say about that. After all, he was the one who wrote, “Wealth gained hastily will dwindle, but whoever gathers little by little will increase it.” (Proverbs 13:11)

    And the Apostle Paul would have a few thoughts on the matter as well as he wrote, “But those who desire to be rich fall into temptation, into a snare, into many senseless and harmful desires that plunge people into ruin and destruction.” (1 Timothy 6:9-10)

    If I had to guess at the primary motivation that drives people to exchange their actual money for Bitcoins I would say that it is greed, plain and simple. The desire to be rich. The desire to be rich fast. The desire to be rich easily. Greed is never a good reason to do anything. If you are considering buying into Bitcoin, first check your heart and be honest about what your motivation is for doing so. Is it greed? Then don’t do it.
    Besides, when anything goes up in value that far, that fast I can only think of tech stocks in 2001 and financial stocks in 2008. Also tulip bulbs in 1630. When will the Bitcoin bubble burst? I don’t know, but it is coming and I don’t want any part of it. You have been warned!

  36. Very dangerous. It can be used to wipe out entire countries. Blockchain might work if credit system is reformed, as to remove percentage for barrowing the money. Even then it has to go through long, thorough trial. Why? Because technology is in hands of people, and all the mistrust is not towards technology, but people who operates it, especially financial clans like Varburgs, Rotshields and Rockefellers. This lady is one of them. Or may be she is delirious, so she'll promote blockchain, but people who are behind her back will abuse it.

  37. Will blockchain make all the banks activities totally transparent? No. So what are you talking about, lady? To make banks even wealthier?

  38. what is really funny is that TED and she both tell this to us in 2016 not in 2009! 7 years LATER! Can you imagine! It's as if you were told math basics at your graduate! Just let this sink in to your mind a little bit longer. And understand the "real role" of such public speakers to society.

  39. Many people may not understand how to trade bitcoin or how to get into crypto, James Carlson is a pro and can show you how to trade, earn and invest successfully with bitcoins on your own portfolio, and also manage your account daily with his accurate signals. If you are interested and can invest up to 1btc more/less then it's your time to step up your game James can be reached on [email protected] contact him and he will show you some of his strategies

  40. 30-30-30-10: A More Thoughtful And Egalitarian Formula For Equity Distribution In Tech Startups For The Age Of Abundance https://www.amazon.com/dp/B07QG48X51
    The Blockchain: Fundamental Like The Internet https://www.amazon.com/dp/B07QNMBXDD
    The Blockchain Rumble https://www.amazon.com/dp/B07V6QRM4D
    The Character Called The Tech Entrepreneur https://www.amazon.com/dp/B07R1Q3PTZ

  41. The only hacker I can Guarantee you to work with is [email protected],com/or contact him via WhatsApp +1845-293-3085 You all know me if it isn’t legit I won’t say it my wallet is currently 7 Btc I can survive the rest of my life

  42. I was very lucky to meet hacker QIAUNG he really surprised me because I never believe I could experience a real Hacker that help me out to got 3BTC to my wallet…… Contact Whatsapp +1845-293-3085

  43. Don't give up on bitcoin. I met this real American hacker called Qiaung not quite long on you tube via Whatsapp +1845-293-3085 … I got 3btc from him… With just the upfront payment of the software He is capable.. Chat him up [email protected],com

  44. Thousands of hacker only few are legits I tried allot for real hackers not untill i meet this [email protected],com who helped me for my btc hacks very fast and reliable colud not believe hacker I ever seen. My friend whatspp him +1845-293-3085 today to testify his good hacking

  45. We are currently in a major bitcoin resistance point and concurrently the best time to buy bitcoin. If you miss buying at this point, I will surely say that you have yourself to blame in the future. Even though many institutions try to paint bitcoin black with different words, I can surely say that the holders of bitcoin are undoubtedly future billionaires. Blockchain has created more opportunity in the past years more than any other niche and if you overlook it, then certainly you are missing out on something huge.

    As a bitcoin investor, I will surely say that everyone needs to hold at least some amount of bitcoin, I know many people will want to know how, but don't stress much as a pro trader who helped me achieved mine will also help you to achieve yours. Thomas Harriet is a pro trader, I meet her in a blockchain conference in the UK, and I got hold of her trading strategies. Ever since I met Miss Harriet, my story about how I see bitcoin trading has changed. she understands the market very well that even during the dip, she still make profit. With her effort, I have profited more bitcoin, and with my initial 1.5BTC that I was holding, in a month, she helped me to trade it to 4BTC. I was amazed and decided to share this with those who are still having difficulties in trading or making just little profit and later get burnt up by the market. Thomas Harriet can be contacted through [email protected] and WhatsApp +447723515261, and surely she will help you to achieve that status again.

  46. Trading online is absolutely fascinating, but investing in an already trading coin is superb. Tokoin is a premier project with it wing flying so high and is blooming. I urge us to invest in it as i am positive it will turn a new leaf and help an investor grow indefinately.

Leave a Reply

Your email address will not be published. Required fields are marked *