Blockchains will replace the underlying tech behind current institutions and companies

This technology will transform our approach to the world much like social media (Facebook/LinkedIn/Snapchat/Twitter) has fundamentally transformed our approach to social contracts in recent history.

Paradoxically, most people will not witness the transformation of the underlying technologies of today with blockchain-based technology. To them, it’ll be an instant swap and not a gradual transformation like we witnessed with Web 2.0 (Social Networks), the infrastructure of which took a few years to develop and a decade to be brought to the masses.

Interestingly, individual blockchains may actually move in the opposite direction as and be an exception to Metcalfe’s Law and Reed’s Law.

So think of blockchain like social media and each individual blockchain as a Facebook, a Linkedin, or a Twitter. Over the course of Web 2.0 (and before with the telephone), Metcalfe’s Law and Reed’s Law have helped explain the massive value which comes from a an individual digital network. However, I don’t think this will apply to a technology that, as its ethos, is decentralized.

I think the “Laws” will still be true when speaking about “blockchain” more broadly but not to each individual blockchain-based network since each will be decentralized. There could be a stratified application of those two “Laws,” however, so the “Laws” could be held to be true for “n” values between n1 — n2, but then not be true between n2 — n3. Time, development, and the market will tell.

The possibilities for smart contracts are endless, from innovation in corporate securities (h/t Terrence Yang) to a new way to administer loans — whether it be bank-to-consumer or through peer-to-peer smart contracts, to smart contract-based wagers in eGaming and eSports and an upgrade to the Dewey decimal system borrowing digital content from libraries and academic institutions.

Imagine a peer-to-peer ride-sharing service to compete with (or run by) Uber, a decentralized & immutable UN database to identify and track refugees, and a healthcare database & system that will make patient records accessible to any institution in the network in order to more effectively share knowledge and conduct research to improve patient outcomes — though this will require a lot of reworking [maybe obliteration] of current health care legislation [in the US].

Entire voting systems could be changed by linking votes to immutable and nontransferable blockchain-linked identities. This could significantly curb voter fraud and promote more egalitarian systems and societies around the world. The academic research model could be flipped on it’s head, allowing inter-and-intra-institutional collaboration via smart contracts. Last, and definitely not the least, we could finally innovate within legal jurisprudence, where the approach has remained fairly static since 16th century England. There are several other critical use-cases, including linking digital content to the rightful owner, making sure property rights and land titles are respected (particularly within corrupt, bureaucratic governments), and faster & safer global remittances.****

And create new markets

Appropriate use of blockchain technology could create zero-to-one innovations we haven’t been able to fathom or [successfully] execute so far in the longer term future.

A seamless blockchain-based Virtual Reality “experience generated content” which allows anyone, anywhere to upload or create a unique experience for others to view through their Oculus (or another) headset. Gives a whole new meaning to “walk a mile in someone else’s shoes,” no? A blockchain-based (read: immutable) human-memory vault. This could have profound implications for legal disputes, violence, and abuse of power.

These are just two examples I thought of while writing this post. People (and AI systems) much more creative and intelligent than I will probably come up with more intriguing use cases.

I believe many of these important innovations will take place on Ethereum — the decentralized platform which is currently in the best position to execute the scenarios/transformations mentioned above. Why? Because Ethereum has the strongest developers of any cryptocurrency so far which is critical for a platform that allows DApps to be built.

Yes, in a better position than even Bitcoin. Bitcoin will be adopted far more quickly in the near term (i.e. go mainstream) — particularly in finance, but Ethereum will impact many more verticals in the long term. Watch out for DApps that will be launching during and in the time after DevCon2 (Augur, Zcash, and Gnosis, to name a few).

Still, it’s a bit too early to determine a winning crypto-network since more may emerge.

Trading Strategies

Lastly, I’ll conclude with some non-committal trading strategies. I’ve successfully predicted the last few months of btc/etc crypto, for what it’s worth. To be fair, it’s a simple application of financial technical analysis I learned over the course of my finance degree.

Some traders are bullish and buying ether on the hype-driven price increase that DevCon2 in Shanghai will bring and intend to sell on the news afterwards. Others think the hype is already priced into the current price and they’re waiting for the price to drop before reentering positions. I personally think the hype is not entirely priced in and we’re in a for a few surprises at the conference, which will lead to an increase in the price of Eth after DevCon2 and headed into January. I predict at least a 25% increase from the current market price, though I would not be surprised if it increased further. I’m bullish on Eth longer term and think it could approach $75–$100 by June 2017.

Takeaway: Ether, which may dip slightly after DevCon2, is in for a long term bull run.***** Buy, hold, and [eventually] donate some of the proceeds to charity!