Unicorns are more important than blockchain.

I’m going to blaspheme blockchain. I’m not talking about its forgivable little blunders, like its inability to scale or even its inevitable forking block rollbacks and selfish mining problems. Instead, I’m going to question the moral-political fiber of the blockchain, and then run and hide from the inevitable burning arrows headed my way.

First off, let’s set the record straight: democratization and decentralization are not the same things. Democratization involves each member of the group having part control of the whole of a system. When I think democracy, I think casting my vote in a majority rules type paradigm. My vote gets counted up, but whether my vote is implemented depends upon the many votes of others as well. Reaching consensus is naturally slow — to use tech jargon, the output of such systems results in eventual consistency.

Decentralization instead involves transferring authority from a single central system to multiple local systems. Decentralization is much more common — right under our noses as it were. I think about this as any personal decision — what to eat, what to wear, who to date, what speed to drive, what sports team to root for. I don’t cast a vote and wait to hear back — instead I act as the dictator of my destiny, the ultimate local authority.

So what’s the blockchain made of? Democratization. Blockchain is democratized in the sense that all miners have the potential to govern a block (though, keep in mind that block governance itself operates as a serial dictatorship with quick turnover) and all members have access to a ledger which is theoretically immutable when all peers play nicely.

Because blockchain is democratized, it relies on eventual consistency. But — what if we don’t need eventual consistency? If I trade my friend a rhino beanie baby for a unicorn beanie baby, I don’t need to wait around for the wisdom of the masses to tell me that my friend indeed has unicorn beanie baby. It’s self-evident the unicorn exists (ha! the things I say sometimes…I digress). What if such digital currencies can create trustless systems of local self-evidence?

This would allow for a system in which the ledger itself is decentralized — with pieces existing here, other pieces existing there, but no ledgers frantically copying one another and saying “WAIT!!! I can’t release your 10BTC cryptokitty right now, gotta wait until we reach the magical six blocks later so I know that Alice and Bob are on speaking terms again.” How absurd, really.

So what does a decentralized, self-evident coin look like? Well, such a system would need to start with a set, immutable number of coins (sorry no coinbase here— no block for that matter). Each coin itself carries receipts of the transactions it’s been involved with. As these coins become heavy with transactional metadata, the work of hashing that data can serve as its own form of mining. This is sorta like that “Where’s George?” project, except that tracking the serial number (public key) is obligatory with each trade. This means that each coin carries its own history record straight back to its genesis.

Each coin then becomes a piece of an immutable ledger, with all the crypto benefits of being protected from double-spending. But, instead of being part of a democratized blockchain, it’s one small piece of a decentralized meta ledger. You could conceptualize this in two different ways: You could think of each coin as its own separate chain within a larger ecosystem of chains. Or, you could also think of the ledger as occurring within coins, as opposed to between coins. The point is a given coin’s history is really all that’s relevant for our purposes in a specific transaction.

We humans are decentralized by nature. When it comes to digital currencies, we really just want the freedom to make expedient and safe financial decisions. Let’s not let blockchain’s democratized consensus protocol get in the way of seizing life’s unicorns.

I am building out the censorship-proof infrastructure of the decentralized web with ERA. Want to know more about my controversial ideas for cryptocurrencies? Check out my article: Behavioral Cryptoeconomics: The Secret of Digital Currencies (or The Additive-only Future: Release the Banana Hostages!).

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Unicorns are more important than blockchain. was originally published in Hacker Noon on Medium, where people are continuing the conversation by highlighting and responding to this story.