The Blockchain and the New Architecture of Trust
How the blockchain—a system built on foundations of mutual mistrust—can become trustworthy.
The blockchain entered the world on January 3, 2009, introducing an innovative new trust architecture: an environment in which users trust a system—for example, a shared ledger of information—without necessarily trusting any of its components. The cryptocurrency Bitcoin is the most famous implementation of the blockchain, but hundreds of other companies have been founded and billions of dollars invested in similar applications since Bitcoin's launch. Some see the blockchain as offering more opportunities for criminal behavior than benefits to society. In this book, Kevin Werbach shows how a technology resting on foundations of mutual mistrust can become trustworthy.
The blockchain, built on open software and decentralized foundations that allow anyone to participate, seems like a threat to any form of regulation. In fact, Werbach argues, law and the blockchain need each other. Blockchain systems that ignore law and governance are likely to fail, or to become outlaw technologies irrelevant to the mainstream economy. That, Werbach cautions, would be a tragic waste of potential. If, however, we recognize the blockchain as a kind of legal technology that shapes behavior in new ways, it can be harnessed to create tremendous business and social value.
Kevin Werbach writes with great clarity and insight about the powerful blend of social, technical and legal components that provide the architecture of trust underlying blockchain. Combined in the right way these components provide a wide set of capabilities in a surprisingly wide set of circumstances. This elegant analysis is sure to become a classic and will change how individuals, guilds, organizations and governments invent new kinds of institutions and institutional architectures for our fast moving, radically contingent networked world. I highly recommend this paradigm shifting book.
John Seely Brown, Co- author The Social Life of Information (HBS Press, 2000 & 2017) and Design Unbound – designing for emergence in a white water world (MIT Press, 2018), Former Chief Scientist, Xerox Corp. and Former Director of its Palo Alto Research Center (PARC)
Forget the hype – read this book! With his eloquence and insightfulness, Kevin Werbach made me realize why blockchain truly matters, and the ways it will alter how we transact in business and as consumers. A truly indispensable guide!
Viktor Mayer-Schönberger, Professor of Internet Governance, University of Oxford and co-author of Reinventing Capitalism in the Age of Big Data
In a world where Blockchain has become the new buzzword du jour, Werbach is balanced and thoughtful describing the opportunities, challenges and the underlying technical and social issues. He uses easy-to-read examples and explanations accessible to newcomers but worth reading for even seasoned experts to better understand this important phenomenon.
Joi Ito, Director of the MIT Media Lab and cofounder of the Digital Currency Initiative, MIT
Who rules the blockchain? Everyone, and no one, and lawyers, too. The Blockchain and the New Architecture of Trust is a tour de force tour of the hidden layers of power and politics that make blockchains work. Werbach makes a compelling case for taking blockchain governance seriously.
James Grimmelmann, Professor of Law, Cornell Tech and Cornell Law School
However, Werbach argues, the most significant innovation of blockchain is not governmental or even technological but emotional: the creation of 'a new form of trust,' in which you put your confidence in a store of information without relying on any single person to authenticate it — trust the system, not its parts. The outstanding question is whether this method of cultivating trust is viable, and if it is, in what ways we can best deploy it. The answers we come up with are likely to determine blockchain's future.
New York Times Book Review