It's worth trying to predict the future, especially when you're in a position to change it.
Where do you see blockchain in ten years from now?
CSIRO gave it a lot of thought and a lot of research, and came up with a lot of answers.
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The year is 2030
The year is 2030, and you're looking good for your age.
The underlying vision of the future was based on the CSIRO 2012 Global Megatrends report, which created a kind of foundation on which to overlay different blockchain scenarios. CSIRO suggests several new realities the world will have to contend with, as well as how blockchain may be applicable to each.
|The new reality||Blockchain applications|
| Stretched thin |
Shrinking resources, growing population and upwards financial mobility with corresponding increases in demand and consumption.
|New ways of trustlessly recording information for more equitably and effectively manage increasingly scarce and valuable resources.|
| New health risks |
Widespread and extra-deadly antibiotic-resistant bacteria, pesticide-resistant pests and herbicide-resistant diseases.
Climate change-induced mass migration coupled with the increased prevalence of deadly diseases turns out to be quite unpleasant and further strains limited resources.
|Monitoring sources of pests and diseases with much greater accuracy and granularity, responding to outbreaks faster, enhancing border security with IOT technology and ensuring better pharmaceutical supply chain integrity to limit the effects of counterfeit pharmaceuticals on antibiotic resistant bacteria.|
| A new economic world order |
India and China transition into the world's chief economic powerhouses, experience a growing service economy and middle class.
New business models, cultural ties and trade relations emerge in response to economic shifts.
|Opportunities to significantly reduce international trade barriers, supply chain frictions and overall streamline international commerce.|
| Aging populations |
An aging and increasingly long-lived and long-working population which CSIRO has pre-emptively dubbed "the silver generation".
The good news is they bring a wealth of wisdom. The bad news is they are faced with an endless series of healthcare costs, difficulties saving for longer retirements and will greatly impact the job markets through later retirement.
CSIRO expects these financial pressures to result in a great deal of fraud, on the part of both the silver generation and their underemployed descendants.
|The applications of blockchain to reduce fraud will become more necessary, IOT medical devices will become widely used and people will have a lot of very uncomfortable financial conversations.|
| Some kind of world wide web type network |
Everyday life will increasingly occur in digital spaces. Augmented and virtual reality will evolve from a novelty into a normal accentuation of everyday life and rapid hyper-connectivity will shape organisational and individual behaviour.
|Blockchain can be an essential part of providing security and trust in a digital world and protecting data online. |
Whether it's entirely suitable for handling all of the enormous new volumes of data being created in these digital spaces is not known.
| Porosity |
Barriers of all kinds start breaking down as technology allows more cross-industry movement, horizontal organisational structures become the preferred way of being agile in a faster-paced digital world.
Technologies that remove intermediaries, such as cryptocurrencies and sharing economy systems, contribute greatly to this porousness.
|Blockchain can present an immutable record of one's accrued intellectual property and achievements over the course of their careers and become valuable ways of managing projects carried out across increasingly horizontal networks. |
Silos become quite impractical.
Blockchain has many places in this changing world, CSIRO suggests.
However, it's crucial to ensure that the technology develops in a way that the world is in a position to make full use of it when the time comes. As it highlights in its four visions of the future, the most important factor might be that it can be trusted. Without that, it could all go very wrong and a dozen years from now the world might be left in a position where it could really use blockchain, but it had its chance and blew it.
Naturally, it's worth noting that these aren't CSIRO's predictions of the future. Rather, they are just hypothetical imaginings of the future following four different lines of thought; blockchain aspiration, transformation, new equilibrium and collapse.
- Aspiration – Regulation on rails: CSIRO's aspirational blockchain vision is one where a cohesive regulatory environment has nurtured and grown blockchain into a valuable and trusted addition to sunrise industries such as additive manufacturing and digital intellectual property.
- Transformation – The sheriff on the digital highway: This scenario sees industry adopt a leadership role in the development of blockchain and IOT technologies. Blockchain, by necessity, becomes an industry-supported sheriff on the digital highway, creating trust between parties for the benefit of all.
- New equilibrium – A bumpy ride: A largely unregulated market free of industry guidelines and standards creates uncertainty in the longevity, quality and reliability of blockchain technologies and cryptocurrencies. The sheer lack of quality and regulatory cohesiveness sees a lot of people make a lot of garbage systems, which undermines trust in the technology as a whole.
- Collapse – A slippery slope: Blockchain has been abandoned after various issues have caused the technology to stagnate, and adoption and regulation to stall.
Scenario 1: Aspiration
This scenario sees Australia's well-informed, organised and sensible politicians pre-emptively looking towards the future and encouraging exploration of blockchain technologies in anticipation of a very clearly changing world.
By 2030 the increasingly competitive state of the world has seen a significant increase in fraud, corruption and competition for resources, but thanks to previous efforts the Australian government has been able to use the technology to great effect for resource management, fraud prevention and general organisation. Compliance is a major cost, but the corporate world notices the efficacy of blockchain systems and deploys it to great effect to reduce ever-growing compliance costs while improving system effectiveness.
By 2030 Australia's early adoption of blockchain is also paying off with a comprehensive system for managing intellectual property. This is especially important because Australia also moved sharply towards additive manufacturing to help defray the logistics costs associated with its geographic isolation.
Blockchain is everywhere in Australia. It's widely trusted and known to be impeccably reliable, which forms the foundation of the benefits it can deliver. Blockchain quality control is strictly enforced, and standards are developed to allow for its adoption and implementation on a wide scale. Australia has its own digital currency which runs throughout the system, and may or may not co-exist alongside other currency brands.
Scenario 2: Transformation
In this vision of the future, tech companies have become the sheriffs on the digital highway, implementing their own solutions to instill user trust in the systems that everyone uses day to day. This might be done with trust alone, or it might have been achieved with the advent of effective decentralised trustless systems.
"Distributed ledgers are used to ensure the integrity of IOT devices, their configurations, and the authenticity of software and updates," CSIRO describes. "There needs to be a cop on the beat, and in this "cloud by default" globalised world studded with devices, distributed ledgers have been deputised to deliver trust."
Devices have proliferated rapidly, swamping the world with information, and decentralised ledgers are used to ensure the provenance of information and bring trust to the world of data. Decentralised autonomous organisations (DAOs) are commonly used to create trust where needed.
Smart devices of all kinds from door locks to wearables to permanent implants are now in the repertoire of daily life. The systems bring a lot of benefits, but are pervasively woven into the fabric of everyday life. This brings new risks which need to be managed, and regulations are geared towards ensuring that they have been managed.
Australia has prepared for this new world with regulations that can better ensure the quality of products and which can be seamlessly used alongside IOT devices. Programmable money is a necessity, and finds its way into the ecosystem regardless of whether it's digital fiat, bitcoin or something else entirely.
Scenario 3: New equilibrium
Regulators, wary of unintentionally stifling innovation, have left the market to its own devices with respect to distributed ledgers. The free market has wasted no time abusing that trust, with a series of over hyped and under performing products, and outright scams.
Regulators smack down the more egregious offences where appropriate, but otherwise tend to let market forces play out without taking sides.
Here, ongoing issues have undermined trust in distributed ledger technology as a whole, and incumbents have taken full advantage of this by advertising and lobbying heavily against the new technologies, to better retain their stranglehold.
A lack of global standards and unified regulation has been a major hindrance, and distributed ledger technology eventually splutters out after countless companies took advantage of its perceived trustworthiness in its early days to unfairly gouge people, conduct business in shady semi-legal ways from jurisdictions where it's legal, and manipulate markets and smart contracts to their own ends. One of the worst such excesses was a return of wildcat banking, and companies minting their own tokens with an artificially inflated face value, and then using that to pay workers.
In the face of regulatory complacency and a slew of abuses, the world by 2030 has yet to get the benefits of distributed ledger technology or cryptocurrency. Instead, the stuff has just become a new chapter of the history books, where it's remembered as an example of the bad old days, and a product of less-enlightened times.
The rise and fall of blockchain has still left impacts though. In an example of the sailing ship effect, the rise and fall of distributed ledger technology was enough to scare industry incumbents into new development, and it still brought forward new ways of thinking which informed and encouraged future developments.
The future is nothing like it could be, but it's still something.
Scenario 4: Collapse
Blockchain and cryptocurrency arrive fast and hit hard.
As with the previous scenario, they arrive in a regulatory vacuum which individuals and businesses quickly seize for the purpose of making money as fast as possible.
But unlike the previous scenario, they are still widely adopted. Blockchains make their way into multiple facets of everyday life, and then the offences start rolling in.
Beyond the new wildcat banks, insurance oracles are found to have been deliberately misconfigured to avoid paying claims and raise premiums, and everything you touch is collecting your data to sell to the highest bidder and then the lower bidders, in that order. Your personal information, including medical records and criminal allegations that should have been expunged after you were proven innocent, are left swinging in the open on unsecured public blockchains. There's no way of hiding or removing this information.
Some newly established DAOs are found to be outright ponzi schemes, but the legal finickiness of prosecuting these supposedly autonomous organisations prevents a conclusion and leaves them lingering in the blockchain ecosystem like bad breath. In the end, to hit quotas, to pretend that justice has been served and because the real perpetrators are out of reach, prosecutors go after the mom and pop investors who were taken in by these DAOs.
People lose faith in the technology, and emotionally-charged digital currency bank runs occur. Many digital currencies completely collapse, and the extent to which blockchain has been interwoven with the traditional economy means the collapse ripples around the world.
Everything that touches blockchain, even the best-intentioned and most practical projects, has turned to dust – if it's lucky. The word blockchain is permanently tainted, the experiment has decisively failed. In the aftermath, the Australian government decides to ban blockchain and digital currencies.
What's the point?
The point of the CSIRO scenarios is to inform the ways in which regulations can and should be shaping the future of technology. Because, as it explains, the future is cone-shaped.
The further you get into the future, the harder it is to make predictions. Essentially, the field of possibilities gets wider towards the end of the cone. You can predict the near future with a much higher degree of certainty than the distant future – in other words there is a narrower range of possibilities. Get to 2030 though, and you're looking at a wide set of options.
The point of this visualisation is to highlight the probable outcomes next to the less-likely outcomes, and to consider whether some of the less-likely outcomes might be preferable to the more likely ones.
When paired with these kinds of scenarios, you have a new way of considering some of the supposedly self-evident truths. For example, whether a light regulatory touch really promotes innovation in the long run. That hands-off approach could just as well kill blockchain innovation by leading to scenario 3 or 4.
The question might be how to best define the desirable outcomes. And then, once desirable outcomes have been identified, to push towards them regardless of how likely or unlikely (where on the cone) they are.
It's all quite intuitive, but it's still a potentially helpful way of visualising the potential usefulness of pursuing some of the less-likely future outcomes, rather than limiting oneself to just pursing one or two of the most likely outcomes.
The key takeaway, other than that blockchain is cool, is that starting early is key to maximising one's ability to change the future. You can't yank the circle to the ideal outcome at the last minute, but by identifying it well in advance, even the most far-fetched futures can become increasingly feasible as time passes.
"While we can't paint a full picture of all the opportunities for blockchain technology at present, a number of initial recommendations are evident," CSIRO concludes.
Its chief recommendation might be further R&D investment in trustworthy blockchains, to help push forward development in a way that the Australian government can lead private sector developments if needed.
You might not land a perfect bullseye on the desired future, but it's probably worth trying to get as close as possible.
Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.
Where do you see blockchain in ten years from now?
CSIRO gave it a […]