Wednesday, August 8, 2018

The Big Difference with Software

This difference is simple - in the Hardware Economy, people try to hide what they are doing. In Software, they try to explain what they are doing. Two different kinds of people are involved.

Let's start with Hardware. You are planning on building a Railroad, for example. You keep all information about this Railroad you are planning as secret as possible. Everyone wants this Railroad to benefit their property - and a lot of money is involved here. You want to make as much money as possible - so you keep this information a secret.

You keep everyone, as ignorant as possible. Only a select few will be in the know, and able to profit from this information. Everyone else will benefit, in theory, due to the dribble-down effect - a few crumbs will fall from the Master's table. If you are lucky!

Let's take another example - the Erie Canal. This was no secret, but thousands made money from it - building towns close to its area of influence. That was huge, but only existed in people's minds.

About this time, the early 19th Century, Banks appeared everywhere. They printed as much money as possible - and quickly went out of business. It became obvious that they had to be regulated. Honesty had to be enforced, or everyone suffered.

Much later, this same principle applied to Software. Once Software controlled everything - everyone had no choice, but to be completely honest - in fact, over a Century later - nothing else existed!

Understanding Ethereum Smart Contracts will explain what I mean. Be prepared for a complete change in contexts.

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