Implications of a machine economy

How to decentralize – Part II

Is it possible to have distributed networks with the convenience of centralized services? Especially when centralized services seem the most practical option? Think of Google, WhatsApp and Facebook, but also institutions like banks and governments. Despite all the data leaks, micro-targeting, surveillance, and privacy intrusions, these services are pretty damn convenient to use. And they’re also easy in case you accidentally lose access. Right?

This is the second part in a 3 part series about decentralization. Read Why Decentralization – Part 1 if you haven’t already.

In an increasingly complex world, it is understandable to want comfort, and in return give up some control for that. But currently the balance is heavily skewed towards centralized monopolies. This reduces our freedom, and with it our autonomy. Autonomy is the capacity to make an informed, uncoerced decision.1 But more importantly, it reduces our ability to deal with unexpected changes. In this post we’re going to explore a model that can help correct that balance.

What to decentralize?

Decentralization sometimes seems like a quest for ideological purity. One vaguely defined and likely unachievable single point of perfection. Instead I’d like to think of it as a movement away from the current trend of increasingly centralized monopolies and oligopolies. Think of it as a counterbalance to the dark side of globalization. Decentralization can help put human values back into the ongoing mechanization process.

Decentralization: a spectrum of options, ranging from perfectly distributed to fully centralized.

Seeing decentralization as a spectrum widens our perspective. It allows us to choose where we get the best balance of resilience and efficiency, varying with different use cases.

The soft side of decentralization

The current narrative on decentralization is mostly technology driven. This is understandable, to some degree. We don’t have the ability to decentralize trust in a secure, scalable way yet. Beyond that, neither is it the most important part. Yes, it is necessary for some ideas to work. But building it technically doesn’t mean it will be used, or even useful.
To me, decentralization is as much a psychological question as it is an engineering one. Engineers produce code to benefit humans. So for the technology to work, we need to make sure it addresses the humans’ need. And this is where the plot thickens.

A model for harmonic decentralization

As said earlier: autonomy is the capacity to make an informed, uncoerced decision. To reap the benefits of decentralization, we need a solid foundation to build this freedom on.

Below you see an intuitive model to determine what to decentralize. It follows Maslow’s Hierarchy of Needs. The idea in short is that the lower parts should be more decentralized. That is, increasingly less dependent on people and events further away from us. This way we will have a safe base to explore from and return to, when hungry, hurt, separated from loved ones, or perceiving a threat.2 As we get higher in the pyramid, the need for decentralization is less. And the requirement for some form of centralization could actually increase.

Maslow Hierarchy of needs pyramid
Maslow’s pyramid shaped Hierarchy of Needs on the left, with examples of how to fulfill these needs on the right.

Safety as a premise, not an ambition

I’m working from the premise that if people’s basic needs are met in a resilient way – with the expectation that these needs will likely be met regardless of future changes – they will feel safer. People who feel fundamentally safe, feel less need to make unfair decisions. And with that, society will become safer and less prone to panic responses.3

Feeling safe allows us to fully develop ourselves, in whichever direction we feel like. It is possible to develop ourselves without fulfilling our basic needs first, but only for a limited time and with compounding future costs. 4

The dynamics of a hierarchy of needs

Maslow’s Hierarchy of Needs is not without criticism. Maslow extrapolated the observations of a single affluent group to a universal truth. His interpretation favored individualistic societies, not collectivist societies. It also assumed a rigidity in needs and their fulfillment. In reality the circumstances someone finds themselves in will influence the perception of their needs. War and famine tend to change your priorities, as does political persecution. But the circumstances don’t have to vary so dramatically. Moving out to college, moving in with a new partner, or having a child will change your needs.

But this criticism is where decentralization shows its utility. Rather than using the fulfillment examples as a default, the model should be seen as a framework for awareness of your personal hierarchy of needs. Decentralizing the model allows people to make up their own mind about what needs to rank under Physiological, Safety, Belonging, Esteem, and Self-actualization for them. Or when it does. Because needs are not rigid, but fluid. They change over time, and in interaction with each other.

The Decentralized Hierarchy of Needs: a hierarchy of what you need to live your life.

Understanding the subjectivity of needs and fulfillment

It is important to realize that fulfillments are also fluid. They are not chained to one category of needs.

For example most clothing serves a physiological need. However some clothing can be seen as a requirement to fit in with a social group. Or to stand out from the crowd, going towards Self-esteem. They can even contribute to Self-actualization, while at the same time providing Safety and Physiological protection. Mountaineering wear for climbing K2 is an example of this.
The same goes for food: we need it regularly to maintain homeostasis. But eating with friends requires food in a different fashion. And baking your own pie has little to do with the calories and nutrients food provides on a basic level.

The subjective part here is that an item can fulfill needs on multiple levels. And in the same way there are more ways to fulfill a need. A job can provide income to satisfy your Physiological needs. This makes a preference for job security understandable, but it can also hide other viable income options. Sufficient savings, investments, a business, or UBI5 can provide similar utility, resulting in the same fulfillment.

In short: needs are dynamic. They can be fulfilled differently at different times. And the way they are fulfilled can vary too.

This is all very murky. It almost seems like you need an education to use this. Well, you can’t have autonomy without awareness. To make informed decisions, you need information to start with. And thus for decentralization to work, you need to educate yourself about the things that are currently outsourced to centralized entities. With greater power comes a greater responsibility.7

The reason for this is that knowledge is developing so fast, that some information you learn in school is outdated by the time you receive your diploma.8 Because of this, we need to integrate more philosophy, linguistics, anthropology, and history into our curriculum. These subjects used to be “studying for unemployment”, but in the information age they become vital tools to filter the everyday bombardment of messages.

This bombardment of messages is not by accident. It’s a business model. A big critique against decentralization is the loss of economies of scale. It would be bad for business. But let’s take a look at what costs and benefits big business bring us.

Move fast and break things

Zuckerberg’s motto Move fast and break things characterizes entrepreneurial disruption. It sounds very cool when you’re young. It allows you to make tons of money – if you’re lucky. And it comes at no immediate cost to you. So now some of the brightest minds of our generation work to make us click and consume. They race to grow companies as fast as possible and become a coveted unicorn: a startup valued at $1 billion.

But these big companies are not advancing us on the whole as much as they abuse the commons for personal gain.9 Economies of scale don’t scale efficiently in perpetuity. Their efficiency is also not universal. It comes at the cost of something. In economics they’re called externalities. “The cost that affects a third party who did not choose to incur that cost or benefit.” Unicorns are depicted as a symbol of purity and grace. Unicorn startups are nothing like that. It’s not even magic. It’s just fancy accounting, trying to bank on a minimum viable product.

The accounting trick is simple. They trade near useless vanity items – likes, responses & shares – for things that were not valued before – autonomy, concentration span & your digital identity. These invaluables are then sold on the free market to the highest bidder. Much like slave beads between the 16th and 20th century. And the worst thing is: they’re taking from the commons, but are not feeding back into the system as much as they take. As a society, we end up poorer on the whole.

From bad to worse with IoT

This business model is becoming a fundamental problem now with the internet, but it pales in comparison to what will happen on IoT. The internet could cost you your privacy, money, and autonomy. In the near future, you might even lose your life. Because that’s what happens when the things that are there to make our life easier turn against you. And it doesn’t matter if that is through negligence from a profit oriented company, or malice from a hacker. Dead is dead. Game over.

This is a huge reason why we need to turn away from proprietary software, walled gardens, endless copyrights, and preventative patents. These are all tools to keep your information outside of your control, and your security in the hands of others. The point is that with enough information on you, you can be owned. And you will be owned. Big Tech10 is doing it now. And everyone who buys data from thousands of trackers can too. On top of nation states that have the means and motivation to track such information. We need start decentralizing this process and take control of our digital identity.

Rethinking centralization

Centralized services are easy when you lose access. The flipside of that coin is that access is equally easily taken away from you. 11 But centralized elements are not bad per se. Using too much of it is what is bad. And the type of centralization matters too.

A lot of centralization is currently in the hands of big tech companies. They derive their value to a large extent from some form of uniformity. “Everybody is on Facebook”, “you can Google everything”, “every computer uses Windows”, “available on Amazon”, “Think different12“, etc. We can achieve this uniformity in other ways, through open standards.

From proprietary technology to open standards

With the right use of open standards we won’t have to rely on businesses like Big Tech anymore. Not like we do now. Big business was never efficient anyway, only for the people owning it. We should reclaim the commons and reduce the grip these companies have on the internet, and by extension: on us.

Closed source vs. Open source
Closed source vs. Open source. One looks like a stranglehold, while the other depicts giving and receiving.
Based on designs by alvaro_cabrera.

Now, to be clear: open standards sound as intuitively clear as decentralization. But since we’re already a few thousand words into fleshing out the concept of decentralization and its meaning, you can probably guess where this is going. Open standards. “There is no single definition, and interpretations vary with usage”. And while there is a lot of variation amongst interpretations of open standards, one thing can be said: they are clearly distinctive from proprietary standards. And one way or another, they are the way forward if we want decentralization to work for us.

(This does not mean there is no room for businesses. Quite the opposite. Just not at the expense of anything and everything any more. And not in the too-big-to-fail category.)

Standardization should not mean uniformity

I’m Dutch, and have some opinions on the American healthcare system, the Brazilian rainforest policies, Australian agricultural management, and Chinese censorship to name a few. Plus some ideas on how to fix them. But at the same time I realize I don’t know enough about their culture, the reasons these problems grew this way, and if the locals even experience these issues as problems. Let alone about habits and rules that prevent change, or incentives that could motivate change. It’s not up to me to tell them how to solve that; that’s mostly up to them. Standardization should not be a tool of oppression. Instead it should be choice to adopt standards because it’s the most beneficial one for everyone on the whole.

IoT as a savior, not a threat

The reason I think right now we can practically implement decentralization is the emergence of an autonomous machine economy. Autonomous machines can do the heavy lifting here. If we then shift from using proprietary standards from monopolies to open commons standards, we can still profit from economies of scale. Interoperability from standards will allow diverse ideas to integrate relatively easy. (This is now a small paragraph in a series of long blogposts, but it will be the subject of a lot of later posts.)

How to keep it together when things fall apart

To have our cake and eat it is a theme in this website. We think a model of abundance is just over the horizon, without polluting that same horizon to get there. It does require a different attitude – one of availability over ownership – but even that can be seen as a benefit.13 We already have a lot of the concepts we need, like open standards. We just need to use them differently.

One of the key components still missing are open communication, data interoperability and an uncensorable exchange of value. A sort of glue to connect independent entities. It’s basically the same service centralized platforms offer, but free from third party interference. This superficially trivial difference makes them the exact opposite fundamentally.

The IOTA protocol will offer this functionality for both humans and machines, in a truly free and permissionless fashion. Read more on The importance of feeless transactions for decentralization, or the economics of free value transactions for decentralized energy grids.

Next: Decentralization as an answer to Life, the Planet and Everything

The COVID-19 pandemic is changing life as we know it. But the inconveniences are just a general rehearsal for the changes forced upon us from climate change. It’s not a question of if climate change will happen, but when. But in my opinion decentralization combined with autonomous assets can help us mitigate some of the mess we’ve been getting ourselves into. And maybe even help us come out better on the other end. Change is not the end of the world.

About the author

Bas van Sambeek

Communications strategist, specialized in the positioning of high tech products. I help innovative start-ups and fast growing companies in high tech industries clarify their story through positioning and storytelling.


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  • Another excellent, interesting post! I had not thought of incorporating Maslow’s hierarchy into a decentralized/centralized framework, but I can see the benefits of having the lower levels be decentralized.

    I think we are going to be hit with major climate catastrophes very soon–hopefully that will be enough of a stimulus to get us working together for the common good. There is a real opportunity here–is humanity capable of making the transition??

    • Thank you. I’m hoping that posts like this can make decentralization more tangible, compared to the binary should we/shouldn’t we. It’s a really complex issue, and cutting it into smaller pieces is the only way to deal with it. Maslow’s Hierarchy is one tool to keep the birds view over all the moving parts *and* look at the individual parts, but I’m hoping to discover more.

      In regards to the need for change from climate crisis, the next post will likely revolve this idea from Viktor Frankl: “Between stimulus and response there is a space. In that space is our power to choose our response. In our response lies our growth and our freedom.“

      We’re currently in a pandemic, experiencing what it is to be in a crisis.
      I see Frankl’s stimulus not as a singular event. Instead it grows over time until it passes a threshold to either irritate or inspire us into action. Our sensitivity is not predetermined, we have some control over that.

      I’m hoping to find a mechanism that utilizes the momentum from the COVID-19 pandemic into urgency for action against the effects of climate change. The bigger we can make the space between stimulus and response, the more we gain the ability to act instead of react. In my opinion that is the choice we currently have; choosing how to deal with the hand we’re going to be dealt.

Implications of a machine economy