Crypto’s Role in the Age of Autonomization – Hacker Noon

Many people have stated that bitcoin is akin to tulip mania. It’s not. It’s true that cryptocurrencies may be in a mania phase where price is decoupled from productivity, but that does not tell the full story. Blockchain technology, and by extension cryptocurrency, is a technological revolution and it follows the cycle of other technological revolutions like the Industrial Age and the Information Age. At times, I’ll use blockchain and crypto interchangeably. For blockchain technology to change the world, it must be implemented as cryptocurrency. The two are inextricably linked. This article aims to explain the difference between bitcoin (and the entire crypto-asset class) and tulip mania. I intend to show that cryptocurrency, as a technology in concert with other technologies, is driving the next long wave economic cycle. Technological revolutions transform the world and I will illustrate how, when and where cryptoassets fit within that picture.

Bitcoin was the first “killer app” of a technology called blockchain. Bitcoin brought forth something innovative by creating a global system to digitally transfer and store value. It does this through its design by using decentralization, immutability, incentivization in novel ways that allow commerce transactions without the need of a trusted third party (i.e. like a bank). Moreover, the next generation of cryptocurrencies bring forth the capability of smart contracts (i.e. programmable money). These capabilities are new and they will spark an entire wave of technological improvement centered around how we globally generate, store and transfer value. Let’s take a look at how technological revolutions and their long economic cycles are constructed.

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Age of Automation — Descriptions to Date

Many people have written about the Age of Automation. Just google the term. It’s about artificial intelligence (AI), internet of things (IoT) and robotics. There have been stories and documentaries aplenty the past couple of years on these topics. There are exchange-traded funds (ETF’s) investments focused on AI/robotics and automation like $BOTZ and $ROBO.

Automation is an important trend but it’s not the important trend. I assert on their own these cannot bring about a technological revolution. The last required technology is blockchain and, within its architecture, the idea of decentralization. The important trend is autonomization.

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Blockchain — The Last Piece of the Puzzle

While I think both points of view on automation and cryptocurrency add value to the general movement, I think the writers miss the application and model structure a bit. Technologies that advance automation, like AI or robotics, can easily fit into the current paradigm. Any company that invests in building these will reap the rewards of their investments. There is no paradigm shift and no change to the status quo.

There are 3 innovations that empower cryptocurrency to be the last pillar. The first is a new digital model for the global generation, transference and store of value. The second is the ability of smart contracts that allow for rules-based transference of value, programmatically. The third is decentralization which allows us to cross organizational borders and break the constraints of a centralized organization or a central authority.

The paradigm shift is in the transformation of how we come together to produce work. The shift occurs through decentralized autonomous organizations (DAO’s), smart contracts and new governance models. This shifts the power and the reward from the centralized organization back to the individual. All of these occur in the realm of cryptocurrency. Therefore, the last technology required to bring about a new age is cryptocurrency.

Just like in the last surge, the Internet was an important component of the surge, but not its core focus. It was an integral mechanism, but the revolution was about something bigger. It was the Age of Information. In the same way, this new surge is about autonomization. Cryptocurrency will be an integral component, but the revolution isn’t just about cryptocurrency. It’s the final pillar that will support a broader Age — the Age of Autonomization.

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The Age of Autonomization — What’s Possible

This new Age is going to bring about transformational change. It will alter every aspect of how a business or organization will go about producing goods and services. Throughout the globe, each industry, community and government will begin building autonomous agents to produce work, generate value then transfer and store value.

These actions will be created and enforced by software — agents and bots implementing smart contracts through cryptocurrency platform networks. Robotics will achieve any movement in the physical world. The internet of things will provide the sensors and networks to measure and communicate data. Artificial intelligence will provide the judgement, expertise and evaluation within a closed system. And decentralized cryptocurrency platforms will provide movement across organizations via the smart contracts to govern and enforce the transfer and store of value from the work produced.

Where Are We Now?

It’s important to try and figure out where we are in the cycle. I believe the “Big Bang” milestone happened with the invention of bitcoin in 2009. Artificial intelligence, internet of things and robotics all made significant improvements in their respective space in the early and mid 2010’s. The last nine years have been about the technology and has not diffused to a wider audience, yet. These clues tell us that we’re somewhere at the end of the Irruption Phase. Additionally, we’ve seen some market fervor in cryptocurrency in 2017, so that puts us in the early stages of the Frenzy Phase. As such, I’ve marked where I estimate us to be in the cycle below.

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Conclusion

As you can see, we’ve started a new surge, a new technological revolution. Actions will be focused around building autonomy throughout the entire production cycle. Cryptocurrencies will play a key role. I predict by the end of this surge, we will no longer organize society around labor and production. Production, as a unit, will be solved. Robotics will automate production in the physical world, while sensors and data will move through the Internet of Things. Software, through bots, agents and cryptocurrency will generate, transfer and store the world’s value. Artificial intelligence will provide the brain power to learn, execute, measure and adapt each component within the decentralized system. New models will bring forth our new future.

Right now, we’re in the middle of an exciting time to be an investor. We’ve just started a phase where speculation and investment in the new technological revolution will bring about massive fortunes. Like the railroads in the 19th century and the last surge of the Age of Information and Telecommunications, we’re starting a peak period where investments can produce enormous returns. Cryptocurrency is not like tulip mania because it’s being driven by the adoption of a new technology which ends up reorganizing how the entire globe functions. This won’t happen overnight, but if we look closely we can see that it’s just history repeating itself once again.

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