What the hell is Blockchain, anyway? Notes of #Blockland


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  Blockland swag, courtesy of Hotcard. - SAM ALLARD / SCENE

  • Sam Allard / Scene

  • Blockland Swagland, courtesy of Hotcard.

An emerging problem for the vast array of Cleveland leaders who now promote blockchain evangelism as part of the so-called Blockland Initiative – a radical plan to make Cleveland the national epicenter for all things blockchain – is l & # 39; The apparent inability to explain what is blockchain in terms of the laity and, more importantly, in defining its value for the locals.

Tuesday morning, about 200 people gathered for a meeting in Blockland at the Cleveland Metropolitan Bar Association at One Cleveland Center on E. 9th. Chairs and co-chairs of Blockland's 10 "nodes" provided updates on their efforts, many of which, apart from the jeopardizing of the Solutions Conference plans and the high goals for the development of a blockchain campus, consisted of meeting reports. committee and subcommittee announcements and similar.

There are about 800 people involved in the effort, this estimate kindly granted by Bernie Moreno, the Blockland-self-seller cashier, and despite quite a few mumbo jumbo, it was clear that elbow grease was been applied by several of them for the planning of the inaugural Solutions Conference. It will arrive at the Huntington Convention Center on December 1st and, if people show up, it should be an interesting and productive day. Among the most innovative ideas proposed were the "BlockStudy" sessions, in which groups of experts and participants will discuss how to solve specific problems with blockchain technology.

But during a brief question and answer session, a local barber named Waverly Willis stood up from the front row of the auditorium to ask how "normal blue collars" like him could support the movement and build the capacity for blockchain in the region. This was a good and sharp question, immediately recognized as such, I thought, by the host of powerful co-presidents who had gathered on the stage. In my opinion, it has directly affected one of the most important considerations of the Blockland initiative and other economic development strategies now under discussion: Who do they need? And who will benefit?

Willis's question was kind – how ordinary people could support Blockland – but it was impossible, (at least for me), not to consider his corollary: Why should ?

Steven Santamaria, co-president of Leadland Thought Leadership, along with David Gilbert of Destination Cleveland and Dan Walsh of PNC, said that Willis and other small business owners could help by preaching the gospel of blockchain.

"We ask that you look at this technology and understand it, learn what you can and accept it, and then spread the word," said Santamaria. "If you think back to 30 years ago, before the first iPhone came out, we told you that, bye, there's one thing that makes you call and play and hold, you'd have laughed, but now everyone has one, Blockchain it's a kind of similar revolution that will involve you in vast areas of your life.While talking with your network, explain: This is the future … In ten years, everything will be blockchain. "

What the hell does that mean? As we talk to our networks, what do we say when they ask us what aspect of a world in which "everything is blockchain"? After all, what the hell is blockchain, anyway? What are the tangible products associated with it? This definitely does not sound like computers or cell phones, or even as autonomous vehicles or Elon's Hyperloop, which are not avant-garde technologies, but applications at the forefront of these.

As a genre or technology platform, all this blockchain stuff can get pretty abstract quickly. You may have heard, as I did, that blockchain is a "decentralized ledger", not the one that helps. On Blockland's official website, blockchain is described as a "distributed cryptographic ledger technology used to maintain a continuously growing list of records called blocks".

But there is no universal definition.

"The idea of ​​blockchain", wrote Adrianne Jeffries for the Verge "is now used to describe everything from a system for interbank transactions to a new supply chain database for Walmart. so widespread that it is rapidly losing meaning. "

The first blockchain was the one that underestimated the Bitcoin cryptocurrency. From Jeffries, "consists of a digital ledger that records all transactions from the beginning of time to the present. Copies of the ledger are not stored in a central place, but are maintained by superusers called" nodes ". these nodes, called "miners", batch transactions and add them to the ledger in "blocks", cryptographically linking each block to all previous blocks. "

Other blockchains are now subjected to "other distributed ecosystems". (?) It is assumed that they involve hordes of programmers and superusers and, if you ask local leaders, they will revolutionize the Internet by helping citizens to trust contracts. (Citizens first refer to "corporate citizens", the namesake oxymoron pronounced twice during Tuesday's meeting). Also – plus! – the possibilities for blockchain civil and social justice applications are endless. After all, it's a revolutionary technology.

What can it be. But good luck bring "distributed ecosystems" to a regional road show for barbers and expect that Clevelanders with limited internet access will start to sing the praises of Blockland.

On Tuesday, the nodal chairs launched ideas that clouded, rather than specified, the potential impact of technology. If blockchain is everything, then it's nothing. Ronn Richard, president of the Cleveland Foundation and co-president of the Philanthropy node, said that blockchain would be huge in the art world. Art collectors tend to be scrupulous about the origin of the pieces they buy, he said, and blockchain could help to track and validate a certain history of ownership of the art. Later, during the question and answer session, Richard quoted, at the request of Bernie Moreno, the violence in Cleveland. He said young people are often reluctant to seek advice because of their distrust of the police. But a blockchain supported the anonymous tip line, which could be the answer.

It is true that blockchain startups with wildly divergent products and goals are popping up all over the world. I landed, for example, on the Dentacoin mailing list, a blockchain company based in the Netherlands that seems to exploit the power of the blockchain to validate online dental reviews. It is also true that the positioning of Cleveland as a blockchain hub to attract companies of this type can be a viable business development strategy.

Charlie Lougheed, of Explorys and the Unify project, said that digital authentication is the area with the greatest market potential. This could mean authenticating contracts for law firms, hospitals or financial institutions; or even, as Akram Boutros of MetroHealth suggested, authenticate important documents. Meetings have been held, he said, to make the county of Cuyahoga the first county in the nation to support (or host? Or protect? Or memorize?) Birth certificates and death certificates with blockchain. There may be an announcement on that coming front.

But again, this particular version of the blockchain – the private type favored by financial institutions – could "just be a confusing name for" shared database "."

The confusion on the blockchain, in any case, certainly seems a hurdle as high as the criticism, which Bernie Moreno cited as Blockland's biggest roadblock last week.

But anything short of armored support should not be interpreted as" naysaying. "And Blockland's leaders would do well to keep in mind that their initiative may fail to animate the hearts and minds of ordinary middle class "Clevelanders" for legitimate reasons. "Here are two, at the top of my head:

First: this technological stuff is just above most of our heads. Two: even if we manage to manage them, blockchain does not seem (for now) to have the practical applications that everyone keeps saying, at least not in ways that we will be able to personally try. It all sounds a little bit back-endy. Even Bitcoin, the main thing about the blockchain, is usually not found in the lives of people without access to the Internet at home, or people with no income available to speculate in new and unstable financial markets.

Here's one more reason: Blockchain, like the world of technology in general, is largely a sandbox for white dudes. Take a look at the keynote speakers at the Solutions Conference. All seven are men. Six are clearly white. Among Blockland's nodal chairs, six out of 20 are women, only one is African-American: Calfee's lawyer, Halter & Griswold Teresa Metcalf Beasley. During the question and answer session, Ronn Richard responded to a commentary on diversity and inclusion by saying that there was a "better diversity" at the Blockland meetings than any other situation he had experienced in his 15 years of philanthropy in Cleveland.


I think if the leaders are serious about Clevelanders learning and embracing blockchain technology to evangelize on their behalf, they (the leaders) have to seriously study and deal with the potential effects of technology on the poor and the workers, which should specifically include black and brown people.

It is possible, for example, that Blockland may be malicious for "average Clevelanders", ordinary, with blue collar. The most realistic applications of technology seem to be aimed at the business and have been promoted on the basis of their efficiency (this despite the fact that the most serious and lasting complaint about the blockchain refers to its inefficiency. effects, the inefficiency is somehow infused into it, is the attribute sacrificed for things like security and decentralization.)

In the business community, however, efficiency is pursued without mercy and is achieved at the expense of workers.

Take a look at this conversation in Crain since March, before the first local meeting in Blockland and before Jon Pinney's June City Club speech that kicked many of these conversations into a uninterrupted march. It is a sponsored article – that is, a paid advertisement – by Benesch, the region's third largest law firm, which incidentally employs only five minority members out of a total of 83.

The lawyers of Benesch Sean T. Peppard and Michael D. Stovsky spoke about the blockchain to promote the commitment of their company with related problems.
Their goal was that blockchain applications in the business world had a lot to do with contracts.

"Imagine a manufacturing company that wants to use 3D printing suppliers from around the world to manufacture thousands of highly engineered parts," said Stovsky. "Rather than the inefficiency of having to negotiate face-to-face with hundreds or thousands of sellers, the parties can agree the specific terms of the contract in an electronic environment."

That electronic environment sounds very similar to an existing technology application much more efficient and more popular, namely e-mail, but anyway. Here is Peppard, who elaborates on what he sees as the impact on Northeastern Ohio:

"Imagine a situation where a large producer can reduce his capital expenditures in by growing production in 3D and 4D printers around the world," he said. "These are companies that can produce precision parts to better, faster and cheaper specifications – all while maintaining the integrity of the award process and the company's intellectual property rights in the specifications and in other materials supplied to suppliers ".

This is a hypothetical paragraph, but it seems that some Cleveland employees may be out of work in the scenario they expect. And if one of the applications of the blockchain will be to outsource the local workforce in an even simpler and cheaper way than it already is, this is a step in the wrong direction for the region's economy. (This is just a case, of course, but that is what local lawyers have found appropriate to mention in an advertisement on the subject).

Normal blue-collar Clevelanders are not unique in keeping with the fact that tangible objects are much easier to understand than abstract ideas. Even leaders are hampered by this inclination. This is one of the reasons they intend to build (or redesign) a technology center of ~ $ 150 million, 300,000 square meters to incubate blockchain companies, although they do not yet have incubated blockchain companies. Folks, this is outrageous. Many of them probably do not know LeBron James's blockchain, but may never have a boyfriend behind the building . The physical hub, or campus, is a key component of Blockland, and it's what seems to me to be the most potentially damaging. (Probably superfluous to declare it, but its damage, in my opinion, corresponds to its expenses).

First of all, building a blockchain campus goes against the very specific advice given to local leaders at the start of this year. The consultant and "startup whisperer" Chris Heivley, in his speech on TechStars in March, has denigrated the creation of objects in a list of defective strategies that cities pursue in their attempts to build an innovation economy .

"Let's build a center of innovation!" Heivley mocked in his speech (~ 17: 05). "Who has been to one of these? It's usually in some park outside of the city that nobody ever goes in. The place does not, we call it the strategy Field of Dreams . If you build it, they'll come … but they do not. "(You are invited to take a closer look at the Global Center for Health Innovation for local confirmation of slam-dunk.) It is honestly disconcerting that anyone can take a Blockchain Campus seriously while the Global Center occupies center, after years of existential crisis and restructuring, with ample space available.)

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However, a brand new or significantly redesigned campus is what is evidently being worked on. Jon Pinney provided the update during Tuesday's meeting. Co-chairs the "Place" node of Blockland, alongside Teresa Metcalf Beasley. Pinney said he hired an architect (Vocon) and reduced to three potential sites, which could include Tower City or not. Pinney said he would "grieve" for a few months to settle the negotiations and said he had plans to make an announcement to the Solutions Conference. As reported after the last meeting, the campus is designed as a booth, showers, apartments and event space, in the style of similar incubators in Paris and Chicago. On Tuesday, it was revealed that a K-8 school, dubbed "Genesis", is now also being worked on. Pinney said that some of the items – the treadmill benches, presumably – are only on the "wish list".

When asked about the Q & A from where the money came from, Pinney reminded the audience that he and his co-president, not to mention the Greater Cleveland Partnership and other nodal chairs, were all aware of the type of grants available for major development projects in Cleveland. (No kidding!) He referred to tax credits (both new and historical markets), Tax Incentive Loans, "to the extent that it is available", the Incentive Opportunity Zone, which will allow investors to give up tax on capital gains on investments in so-called "high-poverty areas" and investor financing.

"We built a preliminary initial stack," said Pinney, "and we are in the early stages, but we feel really good about where we are." In terms of feasibility, I would not allocate many resources unless I really believed it was feasible. Stay tuned, I promise you we can make it a pencil. "

Well, one of the ways they can "pencil" is to take away every last available incentive they can get their hands on and even dream of new incentives if the existing ones are not sufficiently attractive. Remember, these are experts. Most of them have been to this show of dogs and ponies, and are familiar with the ductility of the elected officials they control.

Since nuCLEus has dealt with the subject of a complete TIF, that provision should be considered permanently on the table. Remember that up to nuCLEus, Cleveland Mayor Frank Jackson had been uncompromising in his position that the TIF exemptions, which allow developers to pay off construction debt with taxes on the value added of a given site, only apply to taxes of non-school properties. He did not want the Cleveland schools to be changed. But nuCLEus has become creative, and it is a good bet that these leaders will try to catch something similar.

Akram Boutros, co-chairman of the "Political Environment", also said that the Blockland team met the full cabinet of John Kasich and that the cabinet was supportive. As far as we know, they are preparing specialized legislation that will give investors automatic discounts or discounts on investments made, for example, in "infrastructures for transformational innovation". (An automatic discount similar to 10% was prepared by the nuCLEus financial advisor and promptly drafted into law.) Moreno said that the Blockland campus will not entail a "large public asking" financially, but it is worth noting that these various tax incentives taken together, they represent a huge public subsidy. They will have to be closely monitored. Pinney said he would like the first phase (100,000 square feet) to be online within the first quarter 2019, that is, in a few months.

This definitely looks like a honeymoon, but it's a less adventurous (and certainly much less courageous) way, when all these leaders and investors are isolated from risk thanks to public dollars. If there was any doubt that Blockland should be painted in the same grand, inspirational tones as the moon landing, Bernie Moreno made it clear. He began his presentation Tuesday with a clip of the famous JFK speech.

"We have chosen to go to the moon in this decade and do other things, not because they are easy, but because they are difficult," Kennedy's voice reverberated through the Bar Association's auditorium. "Because that objective will serve to organize and measure the best of our energies and abilities, because that challenge is one that we are willing to accept, one we are not willing to postpone and one that we intend to win".

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