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Blockchain: Massively Simplified | Richie Etwaru | TEDxMorristown

May 31, 2021
let me take you down to the ground floor of the internet, this is what the internet looked like exactly 40 years ago, in 1977, the internet was just a couple of computers, a dozen points if I may, loosely connected by some lines that can barely carry a pair. of bits and bytes between them not so much today you are watching this video on YouTube using the Internet in the most sacred part of your house without a cable connected to the device on which you are watching this video in the seat that most people You should see the TED Talks in your bathroom now so we can move from where we are, which should alleviate a couple of points, to where we are today.
blockchain massively simplified richie etwaru tedxmorristown
Many things had to happen. People like Bill Gates and Tim Berners-Lee had to dream about what could The world is like how could we change the world and here we are 40 years later? The thing about great inventions and great paradigms like the Internet is that you don't actually know what day it was created, looking back forty years later. and you look and you say, oh, I see what that did, it did the next thing and the question or the discussion we're going to have today is if there was a paradigm in front of us today, what can we do today to discover it?
blockchain massively simplified richie etwaru tedxmorristown

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blockchain massively simplified richie etwaru tedxmorristown...

What is that paradigm going to do in 40 years so that we can now take advantage of it and be part of what Bill Gates and others did with the Internet? To be able to do that, to get ahead, you have to ask yourself. what I like to call the big question and the big question about any paradigm is what is the one thing what is the one gap that that paradigm fills for everyone now I said hindsight is easy, hindsight is 20/20 but foresight That's where it gets difficult. Let's take a look back if we think about some of the great inventions of our lifetime, the printing press, for example, in the year 1400, the printing press filled an interesting gap, it filled what I like to call the knowledge gap at that time, the knowledge only came to the special anointed someone would get a clay with the name of kings and that is how knowledge came from the gods, the printing press was invented and it completely closed the knowledge gap if we take a look at something like the engine he invented, What gap did it fill?
blockchain massively simplified richie etwaru tedxmorristown
Well, it filled a power vacuum at the time when we wanted to manufacture and all we had was labor slavery, colonialism, the engine helped get rid of all that and then our favorite invention, the Internet, which started 40 years ago, You looked at him and you would say. I'm not sure what he's doing today. I like to think it fills the distance gap. The world is much smaller than it was 40 years ago. Today you can transact with almost anyone from any distance we are here. Let's talk today about the next gap that exists, there is a gap that is being built in our society and there is an invention, as you can imagine, that fills that gap.
blockchain massively simplified richie etwaru tedxmorristown
That invention is called

blockchain

. Now, this is an over

simplified

version of a

blockchain

conversation for all those blockchain experts out there. sixteen of us who exist in the world save all the details for the comets we are going to have an over

simplified

conversation we are on the ground floor of blockchain and what I want to talk about is what is the gap that feels so that we can look towards go ahead and see what the world could look like and take advantage of it. Changing blood is something very fundamental for us, it is at the center of who we are and each of us do it hundreds of times a day.
The change is only going to change how we trust, not just how we trust each other, but more specifically how we trust in business. Now you could say WOW, confidence in business. I trust all the companies I traded with today, of course I do. I trust my government. I trust my news I trust everyone I'm being funny here guys Trust is actually very, very central to business Trust in business started very early from cavemen to the commodity economy to the Industrial Age and today in the Age of Information we have concluded, as a species, that I have to trust you in order to transact with you.
Yes, ladies and gentlemen. Trust is the fundamental currency of Commerce. Think about if we simply stopped trusting all companies or governments. Commerce would stop a little. now trusting yourself is very delicate your appointment is close to us easily breakable and yet somehow we are able to trust each other and conduct transactions of a hundred trillion dollars a year between the 7 billion of us on this planet this delicate little thing called trust in some way or the other, we can do it many times a year. The fact is that we made that trust to carry out transactions in one way or another.
We create the trust when I exchange my hard-earned money with you for a good or service I have. to trust you and build that trust, let's talk a little bit about building that trust. I'm going to use my thin, somber voice, anyone here knows that mm, you know the real Slim Shady well, please stand up, let the oversimplification begin, let's talk about how we manufacture trust today to talk about trust so you can really get an idea What I mean by blockchain is going to change the way we trust, let's imagine we are about to buy a house now that we have invented this. something that in society is called a ledger, no, ledger, ledger, like accounting entries, debits and credits, and the ledger is the fundamental way we store information about today's transactions for this house, e.g. if we needed to get a record of who owns it. house and what happens to it, we would store that information in a ledger that looks like this: first a house is built, then it is built and there are some changes that go along with it, it had a few violations here and there, but eventually we could get a record of this house before buying it has anyone here ever bought or sold a house how long does it take to get this information?
You must go to a title company. 30% of titles in the United States have errors. The problem. with the ledger that we use today, which we depend on the trust, many things, not just houses, is that someone as easily as they can write a record in the ledger, they can delete a record from the ledger, can you imagine buying a house and you go to the owner and they say yes, of course, here is the title. I have saved all records of the title. Please have them. Could you trust him? No, because information can be manipulated in the accounting books we use today to carry out transactions. a house, a car, the rights to a work of art, someone who owns an intellectual property or a patent, our temporary, you can manipulate them and the worst thing is that they not only manipulate herbalism, you can delete a record, you can also add to or edit record as you can see here, that chimney violation that happens to this house in some magical way is now a new chimney.
I bet you would be paying a price you don't want to pay for that house, so we have this capability called the ledger, we use it, it's a herbal touch and we can trust a little bit, but we're in this state of commerce where we have to trust but verify, anyone know who said trust but verify, okay we'll add it to the comment. section is also fine, the truth is that today as a civilization, when we start companies or enter into transactions, we start with an automatic assumption that the counterparty cannot be trusted when we start companies or enter into transactions today we start with the automatic assumption that the counterparty cannot be trusted. you can trust the counterpart You can trust it almost seems normal to us, it feels like oh yeah, I mean, why wouldn't we do that?
What has to be like this? It's something we've gotten used to and the way we've done it is We set up these things called intermediaries - fancy word for middlemen and intermediary mediators. These are entities that are responsible for maintaining a centralized copy of the accounting books throughout the Commerce and facilitate the intermediation of the relationship between those who seek to trust and those. looking to be reliable examples of intermediaries are things like banks, a Department of Motor Vehicles, is a big intermediary for identities, mortgage title companies, credit reporting agencies, these are all intermediaries, this is just a small example of intermediaries the ones we deal with today and the The reason we deal with them is because we simply cannot trust the accounting books we have now.
Middlemen don't really get us there. If you think about trading on Xero, trust that trading would stop and abound. Relying on middlemen gets us to a point where we can manufacture something and the rest comes from the gut. The fact is that Commerce and the state it is in today exist in this trust gap. Now I must remind you that oversimplification is still happening, let's talk a little about blockchain to get an idea of ​​what blockchain is and what it does, as you might imagine, blockchain also has a ledger now the blockchain ledger is an update epic of the accounting book we have today.
There are a couple of things that are very interesting about it. The first interesting thing about the blockchain ledger is that each record written to a blockchain ledger has a unique key accompanying it. Now it is not necessary to go into details. cryptography or hash keys etc., believe me when I tell you that there is a really awesome unhackable key that is in every record of a blockchain letter. The other thing that happens to blockchain is that each record is written and sealed by the trusted party who wrote it. record uh-huh, you can see how this is a little different from the shitty ledger we use today, right?
Here is the most important invention when the next record is written, when the next record is written, everything from the first record including the key and the content of the second record is put into that formula and a key comes out for the second record. You can see that there is some dependency now, when the third record is written, the same thing happens to all the contents of record number one, including the key. and the content of the rep that you remember to include the key goes into the formula and a key for the third record comes out.
You can see how the dependency from one record to another is different from what we do today. Now we are once again oversimplifying. area, I get a lot of feedback about cryptography and hash keys, yes all of that is important but this is the fundamental difference and this happens over and over again, essentially technology, making sure that in each record we can see who wrote the record that we can add a key to that record and we can create dependencies between Rome or other records, essentially chaining all the records together. Now you can see where the word chain comes from in blockchain and this is what happens if someone who doesn't like that failed chimney.
The inspection decides to eliminate that very quickly with an algorithm, you can apply it and look at the information and recognize that it was manipulated. That is the difference between how we exist today as a Commerce and how we will exist tomorrow in the future, essentially in a world where we can begin to take advantage of a ledger that is immutable, which means that yes, you can alter it, but it is very easy to distinguish the that were manipulated compared to those that are not, blockchains now generally exist. In what are called communities, what you find is that the participants operating in an industry will all operate in the same chain, so that each participant in that industry has a copy of the information so that they can write to the ledger between Yeah.
This helps sharing this helps transaction performance etc, you could call this the real estate chain, if I may, we are still talking about that house that we are buying, obviously, there will be a healthcare chain, there will be changes in financial services, they will all be. industrial chains and eventually we will see a chain of chains now if something happens that interferes with one of those Ledger, let's say something happens, it runs a consensus algorithm, looks at the rest of the Ledger and says, hey, you're the one out and it is replaced by a copy from those who still have good information.
New blocks of transactions appear, they are written on top of the ledger collection. New blocks of transactions appear, they are written over, and eventually we find ourselves in a situation where what you're looking at is what's called a distributed immutable ledger. I want to pause and make sure that we take inventory, we talk about inventions, great paradigms, trust in a trust gap, how do we bridge that trust gap today with Ledger that we can manipulate and now We are looking at a completely different ledger, one which is immutable, shared between organizations operating on a specific chain and now distributed.
If you look on the left side of this chart, you will see a Trading statement that uses ledgers that are temporary and require intermediaries.that they have a centralized copy that mediates the relationship between those who seek trust and those who seek to be trusted and, as a result, we live in this trust gap on the right side of this is a different vision of Commerce, a vision of Commerce where The information is reliable and available in real time, but I want you to think about this house we were buying. Can you imagine if the information about the ownership rights of this house were written on a blockchain, how long it would take? of the process to get the title information correct, how much friction it would eliminate and how much fraud it would eliminate, much less the cost.
This is the power of blockchain. Now we saw that in the great paradigms that we analyzed we saw things like the printing press destroy those organizations that were only anointed with knowledge we saw the combustion engine destroy things like colonialism and slavery we saw the Internet come in and destroy physical businesses what we are seeing today It is a new invention called blockchain that changes the way we trust and I believe that trusted companies are going to destroy at the very least these intermediaries that we will simply trust in a different way the human experience is going to fundamentally change us as it went from the printing press to the combustion engine and since the creation of the Internet I will use my thin and gloomy voice again, this is the official end of simplification, so where do we go from here?
The reason why blockchain is so interesting to me and why I continue to study it. and participating in it is that that trust gap that we talk about is actually increasing, we are transacting more things and in more ways than ever before. If we look at this concept of zero trust and abundant trust, we can see that it is necessary. Trust is actually spreading to the right today, not only transacting with humans, transacting with machines, transacting with smart devices. and all of these things, we need to start figuring out how to trust them properly now as blockchain shifts to other things that are particularly interested in what's in the area of ​​identity, what I think about identity, I'm not just thinking about McLovin's Superbad, I'm not just thinking about this 24-year-old organ donor from Hawaii, I'm talking about the 12 million cases in the United States, where there is identity fraud, that is the first area where the trust gap is expanding.
The other area I'm referring to is all the new devices that are coming online that we also have to rely on, not just humans, I think the last one. The protection I saw was that by 2020 we will have 7 times more smart devices than humans in the world, that's about 50 billion smart devices in 2020 that we will transact with and that we will have to trust and this is what I mean by the trust gap it is expanding the other area where the trust gap is expanding is in reputation, we talk about reputation. I'm not just talking about that ghost Yelp reviewer you see writing at a restaurant about how there were five shrimp in the meal instead of six that were supposed to be there.
I'm not just talking about those people, I'm talking about the quarter million. of daily trips that happen between uber and lyft, I'm talking about the hundred thousand transactions on Etsy that I'm talking about The one hundred and fifty thousand rooms that are rented per night on Airbnb are all occasional opportunities where we continue to build trust with our instinct putting ourselves at risk. This is what I mean by the trust gap that is expanding to such a point that when I think of blockchain I don't just think of blockchain replacing middlemen, I think of blockchain creating trust companies that will replace almost every company in the world if there is anything you remember from this talk just remember that now I love tangerines, I love tangerines but it turns out that I have an allergic reaction to the chemicals found in non-organic tangerines, so every time I go to buy tangerines at the store or my wife buys them for me, we have to look for this little logo that says USDA certified organic.
I don't know if that tangerine company got the logo off the internet using Google search and printed it on the package or not. I have no idea if tangerines are organic or not. I just have to trust that they are. There are about 50 agencies in the United States that are certified to give you permission to put the seal on the package you have that you have organic tangerines. Now I want you to imagine the day when a tangerine company comes out and puts a QR code on the package. And I can scan it with my phone and it opens an app on my phone that shows me all the transactions that happen on that tangerine farm, including all the chemicals that were applied to it, and it runs on a blockchain so I know that. .
I can trust it, aha, what tangerine would you buy? I can see that in 20 years he will be remembered as the guy who said, aha, what tangerine would you buy, obviously a tangerine company that runs on blockchain would cannibalize any other tangerine company that just claims to be organic, that's the power of distributed ledger, that is, the power of having information that you know someone has not tampered with and that you can truly trust without having to have an intermediary. The way I see blockchain is that today not everything in the world only intermediaries run the risk of having competition from a blockchain version of themselves, ladies and gentlemen, they were at the base of a new paradigm in humanity that will change the human experience called blockchain, what is going to change is trust, it has been my absolute pleasure, thank you very much

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