Blockchains — Digital Organisms In The Internet?

What would the ideal blockchain look like, if we took inspiration from the realms of biology?

“Two Steps Back” Cellular Automata, another form of “Digital Life”

In the Delegated Proof Of Stake blockchain model, programmers attempted to make a trade off, by reducing decentralisation in favour of increased execution speed. If you’re familiar with Zamfir’s Triangle, one may have speed of execution, but not decentralisation, or, one may have decentralisation, but not speed of execution.

Zamfir’s Triangle, the “Blockchain of Compromise”…

You could in theory have both high speed, and high decentralisation, but you would need very high computational overhead, which at present, is limited by the state of our networking and blockchain technology. Quantum computing blockchain, anyone? But I digress, that’s really still a fantasy for now.

It occurs to me, however, that DPoS is like the “worse of both worlds”. It feels like a compromise.

Is DPoS A Compromise?

Bitcoin, decentralised and leaderless, slow by design.

Amazon Web Services, centralised and dictatorial, fast by design.

Rise, Ark, EOS, Lisk, Tron, not very decentralised, and not very fast, compromised by design?

Of course, many would be quick to point out, that this seems rather like the “glass half empty, or glass half full” scenario. You could also say that, DPoS is “somewhat decentralised, and somewhat fast”. We’re attempting to strike a “balance” between the different parts of the triangle.

However: Real world testing of systems such as EOS, show us that in practice, a system that makes compromises, is not robust.

Dan Larimer, creator of EOS, annoyed with imperfection of human beings. Source.

Because EOS does not deterministically codify the rules of it’s consensus, but instead leaves it up to “wet code”, we have seen it’s Democracy give way to Dictatorship, primarily due to ignorance, either by neglect of the masses e.g. how to vote, or by purposeful orchestration by those in control.

Dan Larimer’s dream of “Representative Democracy”, could easily give way to “Totalitarianism”; democracy only works when those who vote, are aware of how the system functions, and that each person’s vote is unique, rather than the voting weight…you could buy a ton of EOS tokens and become a whale. Voting weight means the rich control the most votes.

EOS Whales will control substantially more votes than the average person. Source.

In addition, a free market often results in hoarding and price distortion, because market actors are acting in “direct self-interest”, rather than in favour of the group through “indirect self-interest. This is the neglect of “edge-cases”. Source: FX-Street, EOS RAM Prices Too High.

Block Producer RAM Pool, the life-blood of dApps, unfortunately you can’t buy any, it’s too expensive! Source.

History has shown us that “free markets” are never “perfectly-efficient”, and that many edge-cases do exist that render our best financial models worthless. Nassim Taleb, author of the famous book “Black Swan” that talks about the 2008 Financial Crisis, made his money by exploiting such loop-holes in the “free-markets”.

Nassim Taleb exploited inefficiencies in “free markets” to make money. Source.

EOS to me, appears to be a case of “incentives gone wrong”, failure to consider the complexity of human beings, assuming that everyone is altruistic and good all the time, engineering a system that allowed for too much “wet code”, and especially, failure to consider edge-cases, such as RAM hoarding.

A proper consensus system would therefore require us to consider not only the average behaviour of human beings (neither very altruistic, nor very selfish), but also the various extremes of human behaviour (extremely altruistic, or extremely selfish). As Nassim Taleb said: “Be prepared for anything.”

Maslow’s “Heirachy of Needs”. Humans wander through all states continuously.

Human beings do not just stay in a particular state, rather they wander continuously through all states.

Probably a better way to design blockchains could be through biomimicry. Create a cryptoeconomic system that harnesses human nature, symbiotically, rather than working against it, which is what I’ll discuss below.

Biomimicry In Cryptography. Cellular Automata have been used in cryptography before. For example, Rule 30, is used in one-way-cryptographic functions, such as hash-generation.

Blockchains, Viewed As A Digital Ecosystem:

Blockchains are thought of as “digital organisms”, their rules of consensus must continually respond to changes in their digital environment, so that they don't starve (chain freeze), ensure survival (mine new blocks), and ultimately, reproduce (fork).

Life, as defined by biology, See Wikipedia.

Matthew Roberts, who wrote the article in the link above, states 7 ways in which Blockchains are like digital organisms, a field he aptly names “Cryptobiology”.

And the many forks of Bitcoin, are in a sense, it’s offspring, each vying to be more adaptable than the parent. Of course, it is likely that many offspring will also perish in the process of reproduction and evolution, which can be seen from the number of “dead coins”.

The digital progeny of Bitcoin, all 1583 of them, as listed on coinmarketcap.com

At present, Bitcoin does respond to it’s digital environment through modifying the mining difficulty. If too many miners come on board at once, difficulty increases in response to the increase in hashrate, and so the block-time is kept at roughly 10 minutes.

Conversely, if many miners leave, difficulty has to decrease to prevent chain-freeze, so the block-time is again returned to roughly 10 minutes. In a sense, the rate-of-growth of Bitcoin’s blockchain is kept to 1-block-per-10-minutes, by the difficulty algorithm, and each block = one cell.

Bitcoin’s average block time seems closer to 9 minutes 30 seconds.

However, like early single-celled-organisms e.g. amoeba without eyes, Bitcoin does not react to other forms of stimuli in it’s environment, such as the “number of unconfirmed transactions”, which can reach a very large amount when the network is busy, causing transaction fees to go sky high. See: Johoe’s Bitcoin Mempool Statistics.

During the peak of crypto bull runs, Bitcoin’s mempool gets very clogged up.

Coming to the rescue of Bitcoin, the Bitcoin Lightning Network can be considered to be a symbiotic organism in relation to the Bitcoin blockchain. It depends on Bitcoin for it’s own survival, since it has to open and close channels from the main-chain, and it earns it’s survival, by helping to relieve some of the Bitcoin blockchain’s mempool congestion (alternative payment pathway). In this way both Bitcoin and Lightning, work together to produce a faster, and at the same time, still secure financial network.

The Bitcoin Lightning Network as seen from Recksplorer.

All this cryptobiology fascinates me, because it shows that if our “digital organism has a goal”, e.g. Bitcoin’s “Decentralised, Secure, Leaderless Money”, it can be achieved. We can design a crypto-biological system that will ceaselessly-tend-to that ideal; never perfect, but always moving towards it.

A proper design approach could then be, rather than attempting to compromise on everything (DPoS I’m talking about you), why not attempt to create a crypto-organism optimally suited for just one-task. Then let it ceaselessly, tirelessly, and endlessly wander towards that singular goal.

Bitcoin for example, is a digital-organism that works tirelessly to keep itself decentralised and secure, by attempting to create a state of perfect competition between miners.

Photograph of a Bitcoin mining farm in China, mining has become a large-scale business.

It does this through rewarding people for their greed, through mining-rewards. This ironically keeps the Bitcoin network secure; greed is converted into investment in mining equipment, which then produces hashing power, which is then converted into Bitcoin security.

The more greedy people there are, the more secure Bitcoin becomes. Although many have criticised Bitcoin for being “old and slow”, upon closer inspection, you realise that it’s network inefficiency is on purpose.

Bitcoin and Ethereum are still the most resistant to 51% attack. Source.

Other examples, are like the stable coin Havven, optimised for just one thing: Price Stability. Stability, and the group-incentives to create stability, are literally baked directly into their cryptoeconomic protocol, see whitepaper. Havven is a symbiotic organism to Ethereum, it’s a smart-contract that lives on the ETH blockchain. And the more symbiotic organisms join Ethereum, the more useful and resilient it becomes too.

Perhaps developers should copy nature, and just aim to be the best at what you want your digital creature to become. Don’t over-promise and try to do everything. Compromise may lead to weakness.

When you look at the tree of life, you can see that there are millions of organisms, each narrowly adapted to their ecological niche, rather than one large super-organism that does everything well. This could indeed be the model for our blockchain future, we need to work on inter-dependence, resilience via cooperation amongst blockchains and dApps.

Bacteria, the original main-chain of life, everyone else just forked off it. Could Bitcoin be the “bacteria” of Blockchain? I think it’s highly likely.

Extrapolating The Future From Present Day Conditions:

Could “proof-of-work” systems like Bitcoin and Ethereum continue to survive, amidst an ever-growing zoo of other consensus protocols?

Extrapolating The Future From Future Assumptions Of Computing:

Could there emerge a “distributed consensus protocol” that is an order-of-magnitude better than anything available today? We shall call this idea “Sapient Chain”.

Assumption 1: Speed of networking, storage, and computing, exceed our wildest imaginings (quantum computing).

Assumption 2: Blockchains are no longer limited by Zamfir’s Triangle. Akin to finding a method to exceed the speed-of-light. (May not be impossible, just very very hard).

Result: This makes it possible for a “super blockchain” to be developed, a blockchain of all blockchains, that may run all dApps at high speed, on it’s decentralised architecture.

Conclusions: