Rewriting the Story of Human Collaboration
“All the forces in the world are not so powerful as an idea whose time has come.” - Victor Hugo
One of the difficulties I have come across lately is trying to explain the relevance that cryptoeconomics hold for solving real-world problems. Between the crypto jargon, the complex technology, and preconceived notions of the usefulness of cryptocurrencies being limited to the realm of finance, trying to explain a concept like curation markets to the average person can be a trying task.
In the below presentation, I will discuss a new (and experimental) form of decentralized human collaboration — the curation market, how we can structure our economic incentives to more closely resemble stable networks found in nature, and how these cryptoeconomic primitives form the building blocks of a new cooperative framework for global action that can be used to solve the world’s biggest problems.
There is plenty of evidence that we have reached the effective limits of traditional organizational structures. Tribes were effective when your in-group was less than~150 people, and you could remember reputation, debts and favors for each member of the tribe. Since then, religions, nation-states, and corporations have all taken our ability to collaborate on synergistic goals to new levels of achievement.
But how big is too big? Have we reached peak hierarchy? Think of the UN or the EU, or your average government institution: excessive overhead, an army of paper pushing middle men, a lack of transparency, coherence, speed & efficiency. Our institutions are reactive rather than proactive, and however well-intentioned most may be, our governance models are too slow to respond to problems that are arising ever faster with the speed of our technology and economy.
Not only that, but our national affiliations promote NIMBY politics that lead to a global tragedy of the commons around environmental and other global concerns affecting each and every one of us — although the global poor are hardest hit. Many call these market “externalities”, but this term is misleading, and leads the reader to believe these costs (and the liability) lie outside our current system. The reality is that when profit is the sole motive of extractive industries, these problems are more a feature than a bug of the extreme capitalist economy we live in.
Is it possible to co-opt the useful functions of a healthy market economy and expand them to include a more complete concept of economic success, creating a new method of truly global collaboration in the process?
In conversations on the topic, I encounter many people with feelings of resignation and apathy, as if our current system is our only hope of achieving progress — and some of our most powerful global institutions seem to be moving in the opposite direction. Is there a way we can affect needed change, without waiting for action or permission from the powers that be?
If we look around at nature, we can find many examples of self-organizing systems that achieve complex and efficient system design and management — without anyone in charge.
“I’m not trying to copy Nature, I’m trying to find the principles she’s using.” — R. Buckminster Fuller
Can we emulate these systems to achieve greater global consensus and coordinated action to tackle the wicked problems of our time?
Ants leave pheromone trails to build highways and colonies. Cytokenes leave chemical markers in our body that signal defensive action to be taken when infection is present. These systems use environmental stimuli to spur a specific action on behalf of the next agent who comes across that signal. This creates stigmergic communication, where directions don’t have to be given directly by a leader with a plan and followed by the workers, but rather flow naturally from agents in the system in a decentralized fashion.
When Boris Yeltsin paid a visit to a US supermarket in 1989, he marveled at the ability of capitalism to provide such an array of plentiful food — in the centrally planned economy of the USSR, food shortages and long lines were the norm. The success of US market economy to provide goods & services, without any overseeing organizer, is caused by the power of profit incentives embedded throughout a capitalist society.
The metaphor of Adam Smith’s “invisible hand” operates by aligning action with the profit motive. When you allow people to use their skills or resources to financially benefit themselves, it turns out they will, and they don’t need to be told how to do it!
So we already have a stigmergic coordination mechanism in capitalism — now how can we more properly align those incentives to produce socially-beneficial behaviors and outcomes?
Charities, NGOs, and non-profits have popped up to solve almost every problem known to mankind. Many of these organizations start out to solve important issues, but over time they acquireinertia of their own, which can lead to a conflict of incentives. When an organization, employing thousands of people working to solve a problem, has to disband when that problem is resolved, you might reasonably expect some conflict of interest to arise.
Another unfortunate aspect of that inertia is overhead cost, which accumulates with office space, staffing, and necessary bureaucracy, and negatively affects people’s willingness to donate to a cause.
Can we come up with a decentralized infrastructure to create, fund, and work to resolve charitable causes without the bureaucracy and overhead of a traditional charity?
To answer that question, we need a few building blocks. First, a new token generation model might serve as a means to append value (and thus stir the profit motive in network participants) to almost anything in a crypto-connected world — a product, an action, or even a cause.
The nature of the bonding curve implemented by the smart contract is critical to the success of the network we are trying to build. So we need to be very careful about the parameters of the curves chosen to encourage the optimum ecosystem needs, e.g. in the number of users or amount of HODLing desired by the project.
Token bonding curves, acting as automatic market makers, provide a useful alternative to the ICO as a token generation model.
So how does this work in the real world? Here is an early stage, relatively simple example, where we’ll conveniently leave out many of the problems that complicate the use of bonding curves, TCRs and curation markets — more on those later.
Trash Hero is a grassroots litter cleanup program that got its start in Thailand while I was living there in 2013. I loved the project, which encouraged backpackers and locals alike to come together and pick up rubbish washing up on the beaches. I donated sporadically to the cause to help pay for basic cleanup supplies, but I wondered if there were better ways to contribute, that could maintain the success of the Trash Hero ecosystem without the requirement of seeking donations all the time. In other words, how can we better maintain the attention of project funders/investors?
With the advent of curation markets, bonding curves, and a crypto-enabled global population, we have the technology to create networked bounties, which include an ecosystem specific currency and micro-economy fluctuating based on the successes or failures of the project.
In some future scenario, the beaches in Thailand may have been cleaned up in large part, so fewer donations are needed. As #THC tokens are sold, their value decreases according to the token bonding curve, and the donation network smoothly winds down to a smaller level of operation, commensurate with its needs. (Granted, this could go many different ways depending on your sell curve properties — thus the importance of bonding curve parameters!)
Though the example above is very basic, it shows some interesting properties. It encourages donations to successful causes, while also providing network liquidity for goal completion, and a potential investment opportunity for donors and project participants at the same time. A project able to bootstrap funding and token value along with project success and popularity, yet also remain light on infrastructure, with the ability to wind down gradually as a problem is resolved and the project requires less funding — that’s a powerful idea.
The true benefit of a model like this, however, would be opening up the ability to create these movements to absolutely anyone in the world, with permissionless, direct, incentivized global participation.
The power of networked bounties lie in the system feedback loops that mimic those we find in nature. By aligning the profit incentive with socially beneficial behaviour, we allow ourselves to build robust, regenerative systems more in balance with themselves and the ecosystems in which they exist.
So far we have discussed funding models for new self-organizing systems, but there is more that goes into an organization than just funding. In order to be successful, an organization needs to create & build upon a reliable knowledge base of relevant information. Just like with token bonding curves, we can utilize market forces to align the profit incentive with the curation of good information relevant to the success of the project. Enter, curation markets!
As mentioned earlier, many issues remain to be resolved before we see fully functioning curation markets, and TCRs in general. These issues include minimum economy size, optimized curve parameters, identity/reputation, UX/ease of use, herding, free-riding, collusion and more. But with the scale of the gains to be made, the quality of the minds tackling the problem, and the increasingly sophisticated incentives we can stake along the way to keep progress moving in the right direction, I’d be willing to bet that some future evolution of curation markets will cause a revolution in human information gathering and global collaboration processes.
This is a very simple example — for more context and real-world application of the curation market model, read Trent McConaghy discussing The Ocean Protocol, or Simon de la Rouviere’s forward thinking articles here, here and here.
In the above situation, we can see the self-correcting ability of the curation market system to prevent a monopolistic takeover of control. We also see a network that values & rewards the users who curate information, a marked difference from many data networks we use today.
The implications of this new method of information curation are profound, and the rabbit hole is deep. I’ve tried to keep the examples straightforward in this article, but if you want a to delve deeper into the potential of curation markets, check out this incredible ‘Token Curated Intellectual Property’ concept by Paul Kolhaas of Molecule.
Simona Pop at the Bounties Network is doing great work bringing awareness to the human potential of the blockchain. She is behind the first social impact bounty, #BountiesForTheOcean, which is live now on the Bounties Network. Participating in the bounty will earn you 10 DAI ($10), with verifiable proof of cleanup. For this bounty, photo proof of you at the cleanup site and the day’s date is required for bounty completion. (Side note: this verification method could be gamed, but until more trust-worthy oracle systems are available, methods like this are a great start until the concept scales).
This is a fantastic bounty, and opens the door to a new kind of philanthropism. A peer to peer collaboration on projects ranging from the local to the global, with direct, transparent transfers of cash from donors to bounty participants. A balanced, low-overhead impact program delivering income to anyone who participates in improving the social conditions towards which the project is aimed.
The next question is, can we take social impact bounties like #BountiesForTheOcean to the next level? Can we use token bonding curves to build networked bounties that exert stigmergic forces to leverage resources for the emergent expansion of projects aimed to tackle the biggest problems facing human-kind? We are only unraveling the first layers of the potential of this technology.
Although we are in the early stages of TCR development — shout outs to AdChain and FOAM as front runners in the area — we are seeing an explosion in experimentation around this niche of the crypto sphere. There will undoubtedly be many failures, and lessons learned to apply to the next evolution of the idea. Using blockchains as incentive machines and staking bounties for steady progress, we can leverage our ability to maintain attention on consistent effort towards realizing the massive potential latent in these concepts.
As we observe in nature, when organisms mature and evolve, they progress from competition to cooperation, and often build resilient, self-correcting, vibrant ecosystems — as Jenine Benyus says, “collaboration rather than competition that is the survival mechanism in natural systems.” Consider the human body, made up of trillions of cells and bacteria. By collaborating synergistically, they not only provide for themselves, but also for the whole, a by-product of which seems to be the formation of a meta-level intelligence — us.
Are we approaching a similar interconnectedness of the human race, with decentralized collaboration and information curation becoming a new cooperative paradigm for humankind? Perhaps we are a little early to that party — but with the inclusion of AI, DAOs, and other building blocks in the crypto space, the future is bright indeed.
Perhaps our outdated models of competitive predatory capitalism will be replaced with a new collaborative social framework, aiming to optimize for the health of the individual and the whole simultaneously. At what point we might expect to give rise to an entirely new form of collective intelligence, or whether we could even comprehend it — is a question for another article. ;)
Many projects are currently working on the remaining issues surrounding TCRs and Curation Markets, and putting them to interesting use. Read up on a few below:
- AdChain: Curated list of high-quality websites for ad placement
- OScoin: Monetizing open source projects
- Relevant News Reader: Incentivizing quality news curation, combating inaccurate information
- SingularityNet: AI Curation Markets
- Weeve Network: Reputation weighted TCRs
- FOAM Space: Geospatial coordinate curation
- Way Network: Social discovery curation
- Ocean Protocol: Curation of data pools
- Messari: TCR of quality token projects & information
For further context, here are a few good resources:
Please note that many ideas were borrowed, tweaked, and possibly misrepresented throughout this piece (hopefully not too much!), and I thank the great many minds that have laid the groundwork for what is to come in this industry. Simon de la Rouviere, Mike Goldin, Trent McConaghy, Dimitri DeJonghe, Sebastian Gajek, Slava Balasov, Michael Haupt, Spencer Graham, Jim Waugh, Billy Rennekamp, James Glasscock, Paul Kolhaas, John Griffin, Miguel Mota, Simona Pop, Matt Condon, Luke Duncan, Hunter Gebron, Aleksandr Bulkin, and many more — keep up the great work! Special thanks to Jared Harrill, Richard de Souza, Jason McKee, Joe Holewski, Achill Rudolph, and Christine Wigley for ideas, editing and revisions.
“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.” ― R. Buckminster Fuller