In a business presentation given at Princeton University earlier today, University of Pennsylvania professor and blockchain author Kevin Werbach has professed that distributed ledger technology provides humanity an entirely new sort of trust.
Instead of being a “trustless” technology as many crypto proponents argue, Werbach rather posits that blockchain both expands trust, whilst simultaneously decreasing the level of trust required for a system to cater to all parties fairly.
Blockchain Tech: An Entirely New Concept of Trust?
Professor and writer of, The Blockchain and the New Architecture of Trust, Kevin Werbach, has directed a presentation for college students, faculty, and invited members of the public on blockchain technology and its affiliation with the perception of trust. The lecturer on Legal Studies and Business Ethics at the University of Pennsylvania has suggested that, contrary to popular believe, the technology backing various crypto assets not only relies on trust but provides humans with an entirely new form of it to boot.
To uphold his thesis, Werbach made use of the recent example of the QuadrigaCX exchange and the millions of dollars allegedly lost following the passing away of the exchange's CEO, Gerard Cotten, earlier this year. The professor specified that the example highlighted the fact that distributed ledger technology did indeed rely on many different kinds of trust.
In spite of how little known Werbach's name could be to those curious about either crypto or blockchain technology, the UPenn professor does have the qualifications to help make his views worthy of consideration. Werbach is described as a “world-renowned expert on emerging technology” in a report by the publication of Princeton's Center for Information Technology Policy, Freedom to Tinker. The blockchain author reportedly focuses on business and public policy associating with various technologies, like the internet, big data, and blockchain.
Werbach also provided services to the Obama Administration's Transition Team, along with insight for President Clinton back when the internet was considered an emerging technology.
In today's presentation, Werbach went on to outline some of the different kinds of trust that exist in society today. He spoke about peer-to-peer trust, founded on the relationships between individuals; about Leviathan trust (first detailed by British philosopher John Hobbes) being a social contract between the individual and the state, giving the latter the capability to apply agreements made in private; and intermediary trust, or trust that relies upon a central entity to manage various transactions.
Werbach argues that blockchain adds to these a completely new form of trust. In lieu of trust in any single actor to validate updates to a ledger recording anything (Bitcoin ownership, for example), rather users of blockchains can trust in the design of the system, which makes censorship of data almost unachievable.
Blockchain technology engages with the notion of trust in two ways for Werbach. First and foremost, it minimises the requirement of trust through the removal of a singular point of failure, reduction of the likelihood of monopolies forming, and making inter-mediation processes much more efficient.However, blockchain also operates to expand trust. The tech accomplishes this by minimising reconciliation, performing automated completion of transactions, and making records publicly auditable.
Werbach carried on to mention that there is an obvious conflict of interest between blockchain technology and regulation. This is because blockchains are altogether agnostic towards transactions. Does the Bitcoin blockchain treat coins used to fund the murder of someone any differently than it does those units of BTC that are being transacted for the first time after they were mined? Obviously not. Therefore, despite the higher auditability of public blockchains, blockchain-based currencies are valued by fugitives for the permissionless nature upon which Werbach elaborates.
In closing out today's presentation, the author specified that there certainly were three primary trade-offs all blockchain system designers required to balance: trust, freedom of action, and convenience. By optimising for one of these qualities– for example, convenience– developers must sacrifice some of one or both of the others. Bitcoin, for example, suffers in regards to convenience due to its robust trust model. Alternatively, more centralised crypto assets could optimise for convenience (fast transaction times, instant settlement, etc.), at the expense of either trust, freedom of action, or both.
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