2017 began with the news that bitcoin broke the $1k threshold and continues to keep above the same line. This incredible turn of events showcases once more how 2016 was a most surprising year. Events like the ascendance of Donald Trump and the shock of the Brexit camp victory created a trail of completely confused experts (who might not have been this in the first place).
All of this shows that the scaffolding that kept the current global power system in place for more than two decades is shaking violently. At the same time, all attempts at merging the changes with the same system proved to be half-hearted and ineffective. Because of this, so many people have a strong sense that something big is changing in the world.
Far from the spotlight, a new technology is rapidly dictating the same change and this comes in the form of blockchain. In this regard, one of the biggest changes it will be able to provide mainly to the world of finance is the impact it will have on protocols.
Protocols and Power
Protocol represents a set of procedures and rules that have been set up to govern a particular system. This can be applied to social systems, but also a range of other phenomena. Politicians, diplomats and CEOs all have their own particular set of protocols that they follow in their dealings, but also which overview their own behavior. In those cases when a protocol is breached, the system that is guarded by the now compromised protocols fast becomes threatened.
Protocols do not have to be formal. Informal ones, for example, those which govern the day to day dealings of a country, also represent a form of protocol which tells the people what they can expect. However, things like the UK referendum or the election of Donald Trump are so out of the previously observed norms that they have to be recognized as breaches in protocol.
The direction of the same breaches is less clear. For example, many see Trump as a con artist, neo-Reaganite politician or simply a follower of non-linear conflict like those developed by Vladislav Surkov, Putin’s chief propaganda official. Regardless of his actual nature (which might be incomprehensible) the fact remains that he changes a lot of rules with his mere appearance on the political stage and later success.
A Change Born out of Failure
The common theme in all of these shifts is the idea that the dominant organizational and political powers-that-be failed everyone aside from a very small minority. This sense of overriding failure that smeared the 21st century in much of the Western world once again brought about the issue of huge inequality that was greatly diminished in the same countries after the end of WW2. Because of this, some believe that voters in these unpredictable events wanted a new set of protocol that will change the system from one that is overwhelmingly rigged in the favor of those with power and wealth.
While the same setup has reigned over Earth since the dawn of time, for the first time in history, the documents used by those in power can become available to pretty much everyone. People like Guccifer 2.0 or Edward Snowden have provided the world with a view of the happenings behind the curtain of media misinformation or blackouts. Panama Papers have done something very similar to the world of finance and politics.
All of this showed a dark image of a world that is in a constant state of near-failure, where the powerful are only trying to manage the reality that is too complex to truly master. More importantly for ordinary people, there was a sense that if anything truly big failed, the powers would be powerless to help most of them. An image of a volatile world of uncertainty was established in the popular collective subconsciousness. Something had to change, even if this brought new risks with it and in 2016, this sense for the first time became the dominant force.
The sentiment of change and instability crossed into the monetary domain as well. People all over the globe were used to using bitcoin to bet online and do many other things, but the impact the BTC would have on 2016 was a lot bigger.
In China, 2016 started with a potential collapse of the nation’s stock market and the subsequent flight of capital and devaluation. Europe was thrown into disarray by the UK vote and the ongoing economic struggles of the Mediterranean nations. In the US, a Trump victory was painted as something that would shake the markets to the core, but the complete opposite happened in the following weeks.
But other unorthodox monetary policies were also ongoing elsewhere. In India, the PM ordered an overnight stop in the circulation of the countries two highest currency notes in circulation is a bid to stem out the so-called black economy.
At the start of 2016, BTC was worth about $400 while ethereum was worth only $1. Both projects had a range of internal problems like the BTC scaling solutions and DAO hack of ethereum. But, at the same time, the collective making up the financial industry finally seriously took notice of the blockchain tech. Like in eSports, the moment a particular competitive game attains a certain level of popularity and user acquisition, it will become an eSports in some shape or form.
Here as well, the user adoption and the number of development companies reached a point where there was no denying that he blockchain cryptocurrencies are going places.
Now, no one doubts that blockchain tech, which combines P2P elements, network effect, and financial market approach will be very important in 2017 and the years to come. It is a disruptive beast and there are bound to be disruptive results in its wake.
Because of this, the New Year will be very unproductive and full of opportunities. Many will try to put it to use and among them, a lot will do this no matter what it takes. Negative effects of this process will certainly come with positive ones.
However, it is clear that the sentiment of the people asks for things like this. As the old system crumbles, a disruptive element like BTC could be the very thing a wider blockchain breakthrough really needs.