Enter your email below to get updates for
Markets are Eating the World:

Everyone won’t shut up about blockchains and Bitcoin. Is the hype justified? Should I invest in it? Why should I care?

How will blockchain affect me, my family and my community? How should I think about it and what, if anything, should I do to prepare?

As with any new major technology, Bitcoin and the blockchain will create winners and losers. Those that understand the technology and where it is going will stand to benefit while those who ignore it may live to regret it.

Countless books, think pieces and explanations have been written on blockchain, yet almost no one (except that hardcore Libertarian friend that won’t stop posting on Facebook about how he bought Bitcoin for $200 and you should have listened) really seems to get it.

Markets are Eating the World will give you a map to understand the logic of blockchains. It won’t tell you exactly what trail to walk down, but will give you the tools you need to evaluate how it will impact you.

Some explanations of blockchain look at it primarily as a new form of money, a digital gold that can be used to store wealth. Others look at it  as a new computing platform, Web 3.0, on which a new generation of decentralized applications, dapps, can be built. Neither of these is wrong, both are right in their own way, but they are both parts of a broader story: How Markets are Eating the World.

Over the last millenia years, we have seen the rise of a new and powerful force shaping our world: markets. Today, global markets are as Titans: the credit markets, the stock markets, the commodities markets, and the money markets seem to dominate our world.

But, it wasn’t always like this. Markets are a relatively recent invention in human history. The first description of how markets work was not written until 1776, two millennia after human civilization arose, when Adam Smith published The Wealth of Nations. What explains this rapid rise in the role of markets?

The answer lies in a little studied concept in economics: transaction costs. Founded by economist Ronald Coase with his 1937 paper, The Nature of the Firm, transaction cost economics looks at why some economic activity is organized within firms while other activity takes place in markets. If markets are so great, why don’t we just use them for everything?

The answer is transaction costs, the costs of using a market. In theory, a company could outsource every task to a contractor and pay them only for the work they did instead of paying them a salary regardless of how much they work. In practice, Coase showed, this is impossible because of transaction costs: the costs of finding the person (triangulation costs), negotiating the contract (transfer costs) and enforcing the contract (trust costs) on a task by task basis is so high that it’s cheaper to just keep someone on staff.

The ascendancy of markets then, is a function of transaction costs. New technologies from coins to clocks to the Internet have reduced transaction costs in different ways, opening up new areas to be eaten by markets.

The development of gold coins in Lydia reduced transfer costs by getting rid of the most difficult step in commerce: weighing and measuring of gold chunks. Out of this innovation was born a new type of market: the Greek agora, the ancestor of shopping malls and ecommerce sites today.

The Internet reduced search costs by making vast quantities of information from job boards to books to rental homes easily searchable and reduced trust cost by providing customer reviews. Out of this was born another new market: the online marketplace including companies from Uber to AirBnB to ad marketplaces such as Google and Facebook.

Historically, trust costs was limited by ones’ trust in a trusted third party. Investors prefer investing in the United States than Venezuela because they trust the U.S. legal and monetary system more than Venezuela’s. Consumers prefer to use credit cards rather than cash in situations where they aren’t sure if the merchant is trustworthy because they can always appeal to Visa. This system of trusting third parties to govern transactions works pretty good, as long as whoever is in charge is honest and doesn’t make any mistakes. Alas, humanity doesn’t have the best track record of that.

The key innovation of Bitcoin’s anonymous creator, Satoshi Nakamoto, was to develop a technology that made it possible to enforce rules and property rights without putting all the trust in a trusted third party that may or may not be honest and competent. In doing so, it reduces the transaction cost of trust. 

As gold coins birthed the agora and the Internet birthed online marketplaces like AirBnB, public blockchains like Bitcoin introduce markets into corners of society that have never before been reached. In doing so, blockchains have the potential to replace networks previously run by kings, corporations, and aristocracies.

Markets are Eating the World is more than just a book with some advice and history. It presents a new theoretical model for understanding blockchain, its impact on society, and how to prepare. My goal here is more than to simply publish a good book, but to establish a new school of thought. To carve out a corner of the blockchain space and plant my flag in the ground, to have this book discussed and sold decades from now as the industry matures. To do that, I had to build a framework for conceptualizing fits in the broader narrative. 

Drawing on blockchain’s cypherpunk roots like Nick Szabo and The Sovereign Individual, the book will be a success in the crypto community, capturing the history, how the technology works and the potential implications. However, it’s engaging narratives, accessible examples, and actionable takeaways give it a much broader market potential.

Backed by both academic research and engaging historical narratives, this book will help readers feeling left behind and show them how they can turn this new technology into their biggest opportunity. As the blockchain space continues to grow, this will be the book people recommend to their friends, colleagues and students looking to understand what’s going on.

Enter your email below to get updates for
Markets are Eating the World: