Episode 5 – Financial Freedom: A Brief History of Decentralisation
“The 1980s are memorable for many, many reasons. The New Romantics. Great movies. Ski wear like this… But perhaps the most momentous moment of the decade came right at the end, in March 1989, when 33 year old computer scientist Tim Berners Lee was struggling with data management in his role at CERN. You know – that cool place in Switzerland with the particle accelerators.
So he did some thinking, about things like hypertext, and transmission control protocol, as you do… and wrote a document titled “Information Management: A Proposal”. Possibly the DREARIEST title ever for the most SENSATIONAL proposal of the decade. Maybe the century. It was, of course, The Internet. And it caught on pretty quick. Most of us (of a certain age) were marvelling at the world wide web by the mid 90s. The sheer unbridled possibilities offered by chat rooms blew our tiny teenage minds.
But it’s really only in the 2020s that we’re finally starting to see Tim’s true vision coming to life. What was it, and why did it take so long? If these are the kind of big questions you want answers to and crypto got you spinning like Pete Burns then hot damn, you’ve come to the right place.
It’s time for School of Block.
In the 30 years since the first website was published, the world wide web has expanded to connect 4 billion people across the planet. But what has made the web so dominant and powerful has perhaps also been its greatest vulnerability. Right from the start, Tim made the choice that the world wide web was not going to be proprietary.
Instead, he gave it away for FREE – complete with instructions on how to set up a web server and make your own website. He wanted it to be a tool for humanity, an open, democratic and empowering platform for all that could radically transform governments, businesses and societies.
Tim understood that the Web needed to be unfettered by patents, fees or any other controls in order for it to thrive. And in those early days, thrive it did.
Tim’s vision had four main pillars:
Firstly, it had to be NON DISCRIMINATORY. All data and users were to be treated equally.
There had to be a BOTTOM UP DESIGN. No proprietary code. Everyone can see the nuts and bolts holding this thing together.
There needed to be CONSENSUS. Transparent, universally agreed standards.
And yes, you’ve heard this word before in School of Block… DECENTRALIZED. No central authority, censorship or surveillance. By the early 90s worldwide information sharing was a reality, frictionless and essentially free. Bulletin boards became websites and the new opportunities begat brand new companies, springing up in silicon valley like daffodils in spring. The tech establishment meanwhile was rocking. At the time Microsoft dominated the digital space, with Windows powering 90% of all personal computers.
And into this space burst Netscape. A cover of Time magazine for its founder Marc Andressen and an IPO in August ’95 that valued the company at BILLIONS. Why so much? Because Netscape posed an existential threat to Microsoft. Netscape’s web browser could well Windows as the primary way people interfaced with computers.
Microsoft felt so threatened by Netscape that they concluded the only way to beat their competition was by giving away Internet Explorer for free. But this backfired spectacularly prompting one of the largest antitrust trial in history. A year later, in 1999, Microsoft had sensationally lost the case and was forced to split in two.
This trial is responsible for what the Web has become today… To quote Gary Reback, Netscape’s lawyer from the time. “Because of antitrust enforcement, that’s why we have Google. There is no other reason”.
It was this antitrust ruling that cleared the slate for innovation and the digital giants we see dominating the internet today. Your Amazons. Google. Facebook. Yes, even Uber, Airbnb and Twitter.
And we know what happened next.
Each of these companies seized a market opportunity, exploiting it better than any of their competitors and in turn revolutionising the way we shop, socialise and spend the seconds, minutes and hours in our day. Facebook, Amazon and Google now directly or indirectly influence almost our entire online existence, and along with a handful of powerful government agencies, they are able to monitor, manipulate and spy in once unimaginable ways.
We only have to look at the way Cambridge Analytica manipulated voting processes and elections through Facebook on both sides of the Atlantic in 2016 to see why Tim Berners Lee worried that his invention could turn out to be a ‘destroyer of worlds’ in the wrong hands.
And perhaps the most galling thing is, the power of the web wasn’t taken or stolen from us. We, collectively, gave it away with every signed user agreement and intimate moment shared on our phone, on our computer or tablet.
Which leads to the maxim: if you’re not paying for a PRODUCT then YOU are the product.
And the consequences go beyond the personal – to the issues of political control, censorship, inequality, and stifled innovation. Not to mention actually fake, fake news. To quote Tim himself, “We demonstrated that the web had failed instead of served humanity. The increasing centralisation of the Web has ended up producing a large scale emergent phenomenon which is anti-human”.
Anti-human. Technology is meant to assist us but so often it ends up dehumanizing us. These are deep existential questions that are only being sharpened by the advancement of AI. But there is hope. Blockchain’s vision of a decentralized digital world is the closest we’ve come to Tim’s ideals.
It’s democratic, permisssionless, non-discriminatory and censorship resistant.
But just as Microsoft felt threatened by Netscape, decentralisation is providing a direct threat to the established giants’ business models. Facebook’s response was the creation of their own stablecoin – Libra. This was quickly shot down by the US courts but they’ve not given up, have rebranded it as Diem and are going again. With their global audience baked in they have a supreme advantage over the crypto upstarts so, ultimately it’s going to be up to you. You have the power to choose to contribute to a centralized future. Or a decentralized one. Give power to others, or retain control of your data, your finances and your digital identity. Big questions that require big answers and we’ll be looking at them in detail in the following week.