Blockchain technology and philosophy can have the power to redefine global relations
Freedom underlying an individual’s disposition and rights has formed the seed of independence in the civilizations ruled by the fruit of social development. On the other hand, the relations between civilizations that rose on the assumption of trust lost control with the domination of the powerful over the powerless. On the other hand, block-chain technology and philosophy based on simple foundations may have the power to redefine global relations.
“ECONOMY” FROM THE BEGINNING TO THE PRESENT
The origin of economics dates back to ancient Greece. The words “oikos” meaning home in Greek, and “nemein” meaning management, combine to form the word “oikonomia” which refers to the management of the household in families which are considered the smallest component of society. During the 15th century, this word underwent a conceptual transformation and became “economy” that meant commercial commodity management.
In time, in order to measure, store and facilitate economic trade for commodity changes whichstarted with bartering, people established and shaped the concept of money. As transportation technologies developed in the course of history, long distances became shorter and economic relations became more complex as distances shortened. While different communities produce their own currencies for their own internal economies, changes and exchanges between different currencies triggered the development of trust relationships between different civilizations. Once money has reached a certain point, it was no longer merely a means of measuring and storing, but became a symbol of independence for states.
600 YEAR HISTORY OF MODERN BANKING
Although historians can put the roots of the banking system 5,000 years into the past with historical documents and archaeological remains, it is accepted that the modern banking system was founded in the 15th century by the Medici family in Florence. In the intervening period of 600 years, the banking system has been transformed into a trustworthy institution where money is entrusted with confidence by improving its products and services.
Gold, which does not react chemically and is a representation of beauty and richness, has been the most important component of money throughout history. Reaching golden resources, owning it, terrestrial love for its richness and glitter brings with it the greatest battles in history. At the same time, as a result of the lightheadedness brought by the nominal power of money, states have adopted to play on the value of money by mixing gold with different minerals throughout history. Economics has thus had to generate new concepts beyond and above inflation.
After the Second World War, which resulted in the death of more than 50 million people, the world states come together in Bretton Woods, a small town in the United States, and a treaty constituting one of the most important turning points in history is realized. The United States announces that it will issue 35 USD for every ounce of gold, and with the transition of gold as a standard, the other countries determine the value of their currencies according to the US dollar. Thus, the US dollar becomes the touchstone of global trade, and each country’s inflationary status is balanced in itself and an important step is taken for global trade. The World Bank (WB) and the International Monetary Fund (IMF) are set up and steps are taken to clear the destruction of the global war generated by human animosity and re-establish civilization on Mount Olympus.
It does not take long before history repeats itself, the servants of money who challenge their own holiness are informed by US President Richard Nixon in 1971 that the US will continue on its way without consideration for the gold standard and in a true meaning the global monetary system goes beyond nominal and transforms into a virtual structure. The architect of this virtual Matrix was the US and now the powerful has become able to dominate the weak with a virtual will.
NEW MONEY PHILOSOPHY: BLOCKCHAIN
When the calendars show the date of September 15, 2008, with the bankruptcy of Lehman Brothers, the largest financial institution in the US and described as ‘too big to sink’, hundreds of banks, thousands of companies and millions of people in the US, then in Europe and Asia went bankrupt. About two months after this bankruptcy, while the whole world is ravaged by the global crisis, an article titled ‘Bitcoin: A Peer to Peer Electronic Cash System’ is written by an individual using the pseudonym of Satoshi Nakamoto and whose true identity remains a mystery to this date, is published. For those who are intrigued, the technical statements and explanations in this article, which are translated into almost all languages on the Internet, can be confusing; but the fallacy of this article bears a mysterious claim; ‘O people, you no longer need a monetary system governed by central structures. You can reshape the economy with the power of mathematics and technology within a decentralized trust mechanism.’
Although the word ‘blockchain’ is not mentioned in Nakamoto’s article, the mathematical and technological approaches and the visuals expressing them manifest the concept of blockchain. More than 10 years passed and time has proven the validity of Nakamoto’s claim; global economy can be redefined, and trust can be achieved without the necessity of dominating centralist elements which are the ruling powers. The name and philosophy of the protocol to ensure this trust is the blockchain.
Three components comprise the basis of the blockchain technology; the first is the recording of data with certain rules. This approach constitutes agreement between all parties. Agreement ensures the continuity of the alliance between the parties.
The second rule is that the data is never kept in one center, but by all parties. This way no one is central, but everyone becomes a component of the holistic center. Individual wills cannot harm the whole. Discord and mischief making results in the expulsion of the relevant party or those who constitute a minority in the system. Those who do not comply with the agreement are punished by being excluded from the reliable structure of the system. The last component is what we call Smart Conventions; the data recorded in the decentralized way with a certain agreement acts like a computer program. Thus, rules with predetermined processes can be triggered automatically and no will can prevent this process. The data recorded on blockchain systems can be any digitized records. Not just economic data, documents such as identity records, contracts, title deeds and licenses and shares can also be included here. Today, it is possible to establish information-based virtual units (commodities) that are referred to as ‘Stable Coin’ on blockchain systems, whose value is indexed to US dollars or any other currency and determined in terms of the exact limits of emission volume and cryptology which is the science of encryption. This power may enable the redefinition of global relations which were based on the economic imbalance and domination of the past century.
It would be a mistake to treat blockchain technology as a singular application. Blockchain is a way of thinking and a philosophy with the elements we have mentioned above. It is a protocol of trust for people and societies where civilization can be truly restored. The conditions under which this protocol will be used and how it will be used will be shaped by the alliance of the political, economic and strategic thinking world.
Turkey is a country in which blockchain technology saw interest in a broad sense and was exploited in significant formations in the early stages. Göbeklitepe reveals the potential of leadership for an economic future which perhaps can be defined as ‘rebuilding of humanity on trust’ in a geography where the history of civilization is being rewritten; it has the power to become a truth, not a mere imagination.