Blockchain Resource Management and Removing Our Ideological Justifications
The biggest benefit to blockchain technology is trust.
As a traditional career I have chosen to work in the mining industry. The core function of this industry is to ensure a sufficient supply of raw materials to feed manufacturing and services in other industries, as demand dictates. When demand is high the price of raw material values upward, which creates a level of scarcity based on sell price and increasing production levels which are meant to sell the maximum amount of the product at a maximum of the price.
Once production levels catch up to demand the scarcity will adjust, meaning demand is lowered and the raw materials value downward. Many miners are left with overstretched labor pools and budgets as production and operating costs are reduced to meet the new market prices for the raw materials.
There is a certain level of mistrust in this relationship as companies cautiously inch forward on increasing capital expenditures and asset acquisitions which are meant to grow revenue and increase return on capital employed. All of which is meant to align with the increasing market valuations. Investors don’t like companies which overextend themselves, and those who get caught are often acquired by other companies who better managed the environment of mistrust.
Every second or third I week I spend on a mine site in Northern Canada. The one particular site is a fly-in and fly-out operation. This means that I fly on a plane arranged by the mine company and stay in a lodge which is also operated by them. A picture of the room is provided below so you can see how glamorous my life is.
Over the last few years we have built an excellent team of mine equipment technicians, electricians, reliability engineers, and supervision to manage our operation on that particular site. We have built trust with one another and function as an extremely safe and efficient team of individuals with varying talents and shortfalls.
Much like industries and nations around the world have talents and shortfalls.
While interviewing and hiring one of the important questions we ask is “What makes a good team?” The answers are usually around good management and communication. Those are indirect contributors to what makes a great team for sure, but a great team is built on trust. Plain and simple. We trust one another to meet our own individual micro-accountabilities and keep each other safe from hazards while achieving our macro-accountabilities.
The raw materials industry, as in all industries, has a built-in level of distrust which is based on the fluctuating demand and scarcity factors outlined above. Building a team based on trust in an environment which is financially and operationally structured around the recognition and acceptance of distrust is challenging.
An added dimension of distrust comes into effect when we consider that industries are centralized around national currencies which are utilized in an international manner. The US dollar is such a currency, and up until recently, most raw materials were denominated and operated on the USD platform.
This platform has been promoted and secured through the use of American military prominence and its pre-negotiated mobilization to support allies and nations who agree to maintain the USD status-quo. This is how it has been for thousands of years. A strong caveman protected his small creek or pond, and built up a tribe of weaker subordinates who did his wishing so they could have access to resources.
But soon the caveman’s following became too large and he had to seek out other sources of water. The caveman, and the strongest of his followers, waged war against those who controlled the other creeks and ponds. Eventually those cavemen also came to accept his rule and went to work acquiring more resources for the growing group.
Inevitably at some point the caveman would develop an ideological justification for conquering other people and ensuring access to the resources which were located on the foreign land. This was all meant to address scarcity of resources and the fear of that scarcity. The strong caveman would eventually have more resources then were needed for him and his followers, while others didn’t have enough, or couldn’t afford to buy into the system which was designed to manage the perceived scarcity of resources.
All wars in the history of mankind can be explained through this exact logic.
Blockchain technology is based on the application of unquestionable trust which has been built within the structure of the system. One can almost state that the value of blockchain, and all process which utilize it, is based on the history of proven trust and efficiency within the technology itself.
Is it that simple? Is the value of blockchain a track record, or ledger, of seamless trust? Maybe.
Trust based network logic will expand to encompass all industries, from banking to mining. The improvements to resource allocation and the strategies which develop around ensuring access to enough resources, will have a large impact on how we have defined scarcity throughout human history.
Smart contracts which are based on the blockchain will lead to improved cultural and socioeconomic conditions across the spectrums of economics, academia, and governance. De-centralized governance based on trust is empowering for all of those who participate in the system. Much like our team on the mine site is empowered through undeniable trust amongst the group. We have no need for mantras, corporate values, slogans, ideologies, or propaganda, because we simply trust one another and promote the empowerment of the individual.
Smart commodities contracts and smart stock and bond contracts are coming. It will revolutionize the world and establish trust across all the financial and monetary spectrums. These smart contracts will not be based on the USD or any one national currency. These contracts will be based on the blockchain technology. The crypto method which one chooses to use while interacting with the blockchain will not erode trust in the system.
Do you see? The blockchain itself will be the reserve method. The blockchain is de-centralized trust. It will never be scarce. It can never be hoarded. It does not matter what asset or coin any individual, nation, or institution decides to use. The impact this will have on human warfare and the need for fear-based resource hoarding will be dramatic. Mankind is truly on the threshold of something wonderful. - JC
JC Collins can be contacted at firstname.lastname@example.org
This article is copyrighted by POM Media©2017. As non-Premium content it can be shared and reposted without further permission.
Please SUBSCRIBE to PREMIUM POM for more informative articles.