"Utopia" in the Technological Carnival

This article is sourced from the Reading Magazine, authored by Chen Caihong.

The emergence of blockchain technology has caused a sensation, attracting significant attention as if an internet revolution is about to unfold. Its "decentralization" and "multi-centralization" indeed possess a certain "revolutionary" quality, but blind admiration inevitably falls into "utopian thinking." In this article, Chen Caihong objectively analyzes the revolutionary structure and role of blockchain while pointing out its possibilities and limitations.

This article was first published in the July 2021 issue of Reading, authorized for reprint by Huxiu. For more articles, you can subscribe to Reading magazine or follow the WeChat public account: Reading Magazine (ID: dushu_magazine), author: Chen Caihong, original title: "New Issue of Reading | Chen Caihong: A Blockchain Falls from the Sky," header image: Visual China.

Blockchain is a Revolution

Throughout ancient history, humanity has increasingly lived within a "centralized" organizational model. The so-called "centralization" means that major social activities revolve around a certain "center."

Going to work at a company's "production center," shopping at a "shopping center," seeking medical treatment at a "treatment center," and so on. If you pay attention to your daily life trajectory from morning to night, you merely shift from "Center A" to "Center B" and then to "Center C." We often talk about "interpersonal relationships," but in modern life, the vast majority are relationships between individuals and "centers," with the weight and influence of relationships between individuals being minimal, even though it appears that individuals are dealing with one another.

The "center" plays a core role in the "centralized" model.

Take banks as an example. This "center" uses its own credibility to absorb excess funds from depositors and lends them to borrowers in need of funds. From the perspective of capital movement, banks act as a bridge connecting deposits and loans. However, from the perspective of information flow, banks isolate deposits from loans, especially isolating depositors from borrowers, establishing independent relationships between the bank and depositors, and between the bank and borrowers.

In this relationship, depositors and borrowers provide the bank with personal information such as real identities, deposit or loan requests, and related activity content; the bank obtains this personal information through financial services, security guarantees, and capital provision or returns, storing it with the help of technology. Here, banks are not just financial institutions; they are also trusted organizations and "information centers." Broadly speaking, other modern "centers" are similar to banks, being both certain types of business organizations and trusted entities, as well as "information centers."

The rapid development of information technology has led to a massive increase in personal information aggregated and stored in these "centers," resulting in a qualitative leap. This information can be used to describe people's appearances, understand their thoughts, and predict their behaviors, which is what people commonly refer to as "big data."

These "centers" have also acquired a new title: "big data centers." For the businesses of these "centers," "big data" serves as a helper in services, a tool for management, and a wealth of commercial value; however, for individuals providing this data, it poses potential privacy threats, inexplicable deprivation of freedom, and invisible loss of wealth.

In this sense, the human "centralized" model carries the implication that the "center" may override individuals, leading to lawlessness. In the minds of some pioneering thinkers, "centralization" does not bring about an ideal mode of human life; it will eventually face severe shocks, leading to catastrophic reconstruction.

The "centralized" model has existed for a long time, but it has become particularly developed in modern times. It has its reasons for existence and historical determinism. On one hand, "centers" have built increasingly expansive and profound connections between people, enriching, facilitating, and freeing human social life, allowing distant and completely unfamiliar individuals to interact through trusted "centers"; on the other hand, "centers," with their unique organizational forms, possess their own internal operational logic, value boundaries, and constraints, as well as external social support and checks and balances. The social life surrounding "centers" can be said to be under overall historical control.

In simple terms, the "centralized" model, while promoting human welfare, still has historically defined ethical boundaries or bottom lines, as well as clearly defined legal rules; it is not an ideal model, but relative to idealized constructions, it is the most realistic model.

Moreover, until a fully superior alternative model emerges, "centralization" can be regarded as the best existence for social life. It is hard to imagine how depositors and borrowers can achieve large-scale, long-distance, and high-amount financing without the "center" of a bank.

However, whether ethical or legal, they are merely constraints and cannot prevent "centers" from infringing upon individuals' privacy, freedom, and wealth— all individuals' "big data" is controlled by "centers," and any occasional misuse, abuse, or mismanagement by the "center" will severely damage individual rights, not to mention the "malicious use" aimed at gaining narrow benefits for the "center."

Consequently, there is a repeated reaffirmation and reinforcement of social ethics and laws, with rules being improved time and again, accompanied by severe penalties. However, these can only historically, relatively, and partially address the "bad or evil" issues of the "center." Since the "center" is the source of the "bad or evil" problem, ethics and legal rules lack the power to dissolve the "source."

The logic of human thinking, as well as the accumulation of historical evolution and the hints of technological advancement, leads to a yearning for a "good" social life model, which naturally guides the conception of a technical model that removes the "center": in this world, can there be a technology-driven social life model that solely brings welfare to humanity without any "center" controlling it, thus avoiding those "bad or evil" occurrences?

The technical model of blockchain has astonishingly arrived at the right moment. The reason it is said that blockchain is a "technical model" rather than just a technology is that it integrates technologies from multiple disciplines, including cryptography, mathematics, computer science, and network science, to construct a completely new system of technological integration. Just as building the world's tallest building requires the latest designs, machinery, materials, and construction management, it must integrate technologies from computer science, physics, materials science, engineering, and management to create a new architectural engineering technology system.

Since it is "completely new," blockchain is a great creation of humanity. However, because this creation does not stem from a single disciplinary field but rather from the sublimation of leading technologies across multiple disciplines, blockchain belongs to the innovation in the sense of systems engineering, rather than a breakthrough in any specific disciplinary theory. Referring to blockchain as a completely new "technical model" accurately expresses its inherent determinism.

Blockchain Diagram (Source: godan.info)

The main function of the blockchain technical model is "decentralization" and "multi-centralization," which clearly points to the elimination of the current "centralized" model in the world, posing a significant challenge to the mainstream way of social life. "Decentralization" and "multi-centralization" evidently have different meanings.

The former is negative and revolutionary, targeting the existing model; the latter is positive and constructive, aimed at future creation— the ambitious goal of blockchain is to reconstruct the foundation network of human society as "no center" or "multi-center" through the application of integrated technology: the current "centers" will collapse one by one, and each node in the network will become its own "center"; technical rules will become the highest law governing network operations, technical platforms will serve as the infrastructure connecting personal interactions, and technical procedures will become the trust guarantees for people's exchanges; individuals on the blockchain network will exist and interact "anonymously," as living "virtual persons," without the risk of identity exposure, the worry of wealth loss, or the fear of being "monitored" online and losing their freedom; personal information will no longer be stored in any "center," but will be distributed and "truly" recorded and stored at each node in the network, traceable but unalterable, becoming the basis for subsequent personal life and interactions.

In summary, blockchain aims to "destroy" an old world while also "creating" a new world, completing a thorough transformation of the social life model of humanity. In this light, blockchain is a revolution, aiming to overthrow all "centers" in the social life model; at the same time, blockchain is a reconstruction, aiming to build a "no center" technical network to replace "centers," or a "multi-center" technical network where "nodes are centers."

The emergence of blockchain has shocked the world; its powerful and thorough "revolutionary" and "reconstructive" nature is the source of its impact.

Technical Characteristics of Blockchain (Source: sinotf.com)

Let us speculate about the future of banks and the fate of other "centers." In the blockchain model, depositors and borrowers disappear, transforming into "surplus money people" and "deficit money people," who directly connect funds through a technical platform, no longer needing banks to centralize deposits and issue loans; previous funding connections were based on "bank credit," but now they rely on a "trustworthy" technical model; "surplus money people" and "deficit money people" do not need to use real identities to connect funds; both parties in the transaction operate "anonymously," as long as the technical model recognizes them as "genuine and reliable," thus no party, including third parties, knows their real identities; moreover, the information regarding the direct financing activities of "surplus money people" and "deficit money people" will be permanently stored on the network, publicly transparent, becoming the basis for the next financing activity. Since capital connections can be so direct and trustworthy, without the need for third-party "credit" or "monitoring" for assurance, the end of the "bank center" becomes an inescapable fate.

Undoubtedly, under the blockchain model, other "centers" will also head in this direction; companies will no longer be needed, shopping malls will cease to exist, and hospitals closing down will just be a matter of time.

A society without any "centers" is appearing before us.

Utopian Thinking in the Technological Carnival

Some may ask, isn't the technical platform a "center"? This question is precisely the key to the blockchain model. The technical platform is not a "center," but the blockchain network itself. It is composed of all the computers (or machines) that join this network, having network nodes but no "center."

Once you enter the blockchain network, you become a part of this world, establishing connections with "anonymous" others according to the rules of this world, using the concept of consensus, exchanging data (information, value, assets, etc.) with others or with computers through technical means, and freely "living" on the network.

This is seemingly another world beyond the real world. The wonder is that it exists within the real world. As society transitions from an industrial to an information society, the "network" becomes the primary space-time of human life, and blockchain replaces the "centralized" model in this space-time; it is a tangible and real existence. Because of this, blockchain cannot help but evoke astonishment, admiration, and even strong reverence.

Human thinking tends to exaggerate and criticize the shortcomings of the current model while easily affirming and yearning for the perfection of the ideal model.

This is understandable. On one hand, the current model is not without its problems, causing many explicit confusions and difficulties for people, and their personal experiences easily translate into negative dissatisfaction; on the other hand, the ideal model has yet to be implemented, making its perfect aspects easy to describe, while existing problems may be downplayed, weakened, or even ignored; furthermore, only a perfect model in people's minds can generate a strong yearning and immense motivation to create it.

It is evident that people do not view the current model objectively and are eager to extol ideal constructions, which is entirely natural. We know that exaggerating and belittling reality, as well as glorifying and elevating ideals, is typical "utopian thinking." The emergence of the blockchain model has momentarily amplified the "ghost" of this thinking.

2018 North American Blockchain Expo (Source: blockchain-expo.com)

On one side, the current "centralized" model is widely criticized.

Anyone who understands the operational secrets of the four major American tech giants GAFA (Google, Apple, Facebook, and Amazon) and the three major Chinese tech companies BAT (Baidu, Alibaba, and Tencent) experiences immense psychological fear due to their excessive concentration of personal identities and daily information. People judge that the privacy, freedom, and wealth carried by personal information are unknowingly exploited for free by these companies, and this plundering will continue until the end of individual lives.

Yet, in modern social life, people cannot do without the services provided by these companies; after all, social interactions inevitably involve information exchange, buying and selling goods, and financing activities. Thus, on the surface, there are seemingly satisfactory services, certain conveniences, and "free" benefits, but beneath it lies the significant cost of life that is unknowingly paid, sometimes even endangering life safety. Once you log into these company platforms—note, company platforms, not technical platforms—you embark on an irreversible path.

These "centers" are so chilling that even the mildest critics find it hard not to expose and attack them mercilessly, while radicals will certainly call for society to stop and destroy them, striving to explore new models of "no center" to replace them.

On the other side, the blockchain model is receiving extraordinary acclaim.

In the eyes of many, a technical application system that can fully protect personal privacy, freedom, and wealth while replacing the "centralized" model of human society deserves any high praise.

Looking at the current "centralized" model, especially those "centers" with very high levels of information technology, their contributions to human society are, in fact, immeasurable. When we enjoy fast and low-cost global communication through instant messaging software, securely and conveniently conduct transactions or transfer funds through online payment, or quickly acquire certain knowledge and skills through search engines, our sense of gain, comfort, satisfaction, and happiness is undeniable.

The blockchain model can retain the advantages of these "centers" while eliminating their potential infringements on personal privacy, freedom, and wealth; the characteristics of this model can only be described as "perfect and flawless."

In the history of human society, perfect and flawless things only exist on the other side, only in people's spiritual world. Now that the perfect blockchain has arrived, it is as if a "technical deity" has suddenly descended into the world. What does this mean? Is this not the arrival of a top-level form of human society? Could such an absolutely perfect model potentially end the history of human society?

Half of human history has always belonged to utopia. This does not mean that half of the history of real life and half of the history of utopian thought constitute the entirety of human history. Rather, it means that half of the history of human real life is the process of putting utopian ideas into practice. In fact, all thoughts about utopia are invariably linked to human real life, either used to escape reality or to criticize it; the most positive use is to rebuild reality.

It is evident that the utopian thinking of rebuilding reality tolerates imperfection, incompleteness, and non-absoluteness, and thus adopts a constructive attitude towards existing models, selectively preserving and destroying, integrating valuable elements from existing models into new ones. In this process of utopian thinking and rebuilding, we see that the historical evolution of human society is a process of inheriting development, rather than completely "creating something out of nothing" from human thought and directly changing it into reality.

In contrast, the utopian thinking of escaping reality and criticizing reality must be perfect, thorough, and absolute. The greater the disparity between the reality model and the ideal construction, the more significant the meaning of escaping and criticizing reality can be maximized. If such utopian thinking is used to rebuild reality, then the existing model must be deemed "worthless" and must be completely overturned. Thus, these two types of utopian thinking possess strong subversive qualities.

Regrettably, although we can theoretically define such thinking as "escape-type" and "critique-type" and distinguish it from "reconstruction-type" utopian thinking, in real life, people rarely categorize them in this way.

In the overarching discussions of utopia, overly extreme states of thinking are more likely to emerge, with "escape-type" and "critique-type" utopian thinking often occupying mainstream positions. As a result, in the process of "reconstructing" new models, people either completely deny existing models or merely play with the empty fantasies of utopia in their minds.

In short, between ideal construction and real existence, people prefer a clean break rather than a tangled connection.

Currently, people's understanding of blockchain exhibits characteristics of "escape-type" and "critique-type" utopian thinking, with the blockchain technical model being extolled to the pinnacle of perfection, and many fields are using this idealized construction as the basis for "rebuilding reality."

In this situation, blockchain is rapidly stepping beyond the boundaries of "technical models," becoming a social life model that people pursue regardless of rules, costs, or fears of setbacks, ascending to the altar of social worship. The historical fervor for "technology" that has appeared in human society, along with the lessons learned from it, once again flickers before us. The famous quote from British philosopher Bertrand Russell suddenly echoes in our ears: "The only lesson of history for humankind is to forget the lesson of history."

Russell (Source: britannica.com)

Blockchain is not "God"

What lies before us are two modes of social life operation. One is the "centralized" organizational model, and the other is the blockchain "decentralized" technical model. The former involves people organizing activities around numerous "centers," while the latter involves direct interactions between people through technical systems. In terms of temporal precedence, the former belongs to past history and present reality, while the latter, if it can significantly or completely replace the former, must be the future ahead.

In essence, the transition from industrial society to information society does not inherently require that social life information be concentrated in some "centers" or distributed in a "no center" network; these two different models do not necessarily indicate absolute compatibility or incompatibility with any specific social form. That is to say, even now, both the "centralized" model and the "decentralized" model have valid reasons for existence and do not conflict with the information society form.

Comparison of Commodity Circulation Models in Different Periods (Source: slidestalk.com)

Given this, what justifies the blockchain model's potential to significantly or completely replace the "centralized" organizational model? This question brings us to the foundational comparison between the two models, specifically the advantages and disadvantages of "organization" and "technology," particularly regarding whether they can replace each other and at what level they can do so.

From the perspective of human social history, the "centralized" organizational model is a product of human characteristics or weaknesses—namely, the limitations of individual human energy and the selfishness of individual humanity.

These two characteristics dictate that the overall evolution of human social history requires some transcendent social collective form above individual humans, which can both break through the limitations of individual human energy and coordinate, utilize, and manage individual human selfishness for the benefit of overall human progress rather than harm social development. "Central" organizations can effectively dissolve or even eliminate these dual shortcomings of individual humans, and this model has been the mainstream existence of human society throughout history, which is entirely justified.

However, "central" organizations formed by gathering people also have weaknesses. If a certain organization exceeds a certain boundary and suppresses, harms, or destroys individuals, then the normal functions that individuals should have in human society will be severely suppressed, and the organization's own survival will also inevitably face the fate of ultimate termination. This is clearly not just shortsightedness of a general organization but a regressive act against social progress, representing a form of "evil" in organizational structure.

For this reason, human society has always been accompanied by written or unwritten morals, laws, rules, and various forms of mutual supervision, competition, and checks and balances among organizations, aiming to ensure that various organizations maintain their relationships with individuals within the framework of "removing evil and preserving good."

In terms of the overall history of humanity, such relationships between organizations and individuals have been maintained, despite the many ugly organizational actions throughout human history, and the "organizational" plundering, killing, and wars have not yet ceased, with many individual humans becoming mere "snowflakes" in an avalanche.

The relationship between technology and organization is complex. Sometimes technology can replace certain functions of organizations, while at other times, technology serves as a tool used by organizations. Sometimes, technology may also contain organizational forms, intertwining in ways that are not distinctly separate.

An undeniable fact is that no single technology can exist without the possibility of replacing an organization. This is because an organization is a multi-functional or fully functional systemic existence, and no matter how advanced a single technology may be, it can only play a limited functional replacement role within the system, serving as a tool used by the organization, making it impossible to discuss the subversion and replacement of the organization.

Blockchain is a technical model derived from the combination of multiple technologies. Logically speaking, it transcends the limitations of single technologies and has the foundation to replace organizations, but it also contains the limitations of the types of technologies involved and the functional expansion arising from the operation of the model. Whether it can comprehensively, multilayeredly, and systematically replace all functions of organizations and ultimately take their place remains a significant question.

In other words, if the blockchain model cannot cover the entire functional system of "centralized" organizations, it is likely that blockchain will ultimately become a technical module of modern and future "central" organizations rather than a "new master" that replaces them.

Overview of Blockchain Applications (Source: cbdforum.cn)

Stepping back, even if the blockchain model possesses comprehensive coverage of all functions of "central" organizations, there remains the issue of comparing the social operating costs of the two models. The history of human society tells us that some "utopian" ideas have a logic of realization, but the social operating costs are too high, so high that the resources of this planet cannot support them, forcing us to settle for a "realistic imperfection" in social operation.

The most successful application of the blockchain model, Bitcoin, was designed with a limited "issuance" within a limited time frame, one reason being that its operating costs are excessively high. If the "issuance" exceeds a certain amount, the entire blockchain model may not obtain enough resources and self-destruct. Here, a simple economic cost theory opens up an unfathomable resource chasm in the face of the blockchain model leading social operations, making it difficult to cross.

Moreover, any technology has its "natural enemies." If a certain technology within the blockchain model, especially core technologies, is attacked or breached by its "natural enemies," then the entire model either fails completely or requires a whole set of corresponding technical defense and protection systems to counter the attacks. From the latter perspective, it is quite significant that this technical support for technology and technical protection for technology system construction not only incurs enormous costs but also often requires the direct intervention and continuous maintenance of third-party "central" organizations to initiate, design, and build.

A "decentralized" model's secure operation surprisingly requires the organizational model of "centers" for protection. In certain situations, is it not more effective to use the "central" organizational model in social life rather than the "decentralized" blockchain?

Most importantly, the original intention of the blockchain model is to protect personal data from the potential loss of personal privacy, freedom, and wealth due to "center" control, aiming to eliminate the "center" organization as the source of such "evil." However, can the limitations of individual human energy and the selfishness of individual humanity be suppressed, dissolved, or eliminated by the blockchain model? Based on the current theoretical and practical perspectives of blockchain, there is fundamentally no possibility.

In fact, the early applications of blockchain were closely associated with avoiding the control and legal sanctions of socially relevant "centers," such as the "dark web." We must consider that if blockchain becomes the primary social life model in the future, the limitations of individual human energy may have technological solutions, but will the "evil" arising from human selfishness run rampant within the blockchain model, accumulating over time into a technical social cancer? Will those advanced technologies that protect personal privacy, freedom, and wealth inadvertently wrap the "evil" of individual selfishness in anonymity and secrecy, encouraging the ugly side of human nature to grow wildly, ultimately forcing humanity back to the "centralized" model, resuming the institutional main theme of morality, law, and rules?

Indeed, blockchain possesses revolutionary and reconstructive qualities, which cannot be denied. However, its complete replacement of the "central" model is not only questionable but also lacks feasibility. It is merely a technological model revolution that will have a significant impact on human social life, replacing many functions of "central" organizations, but it cannot completely replace "central" organizations. It is not perfect in itself, nor is it the "God" of social life operation, and it cannot even be called the "God" of technology.