“WE LIKE lists because we don’t want to die.” What Umberto Eco, an Italian writer, said about human beings applies even more to the institutions they create. Without lists that keep track of people and things, most big organisations would collapse.
Lists range from simple checklists to complex databases, but they all have one major drawback: we must trust their keepers. Administrators hold the power. They can doctor corporate accounts, delete titles from land registries or add names to party rolls. To stop the keepers from going rogue, and catch them if they do, society has come to rely on all sorts of tools, from audits to supervisory boards. Together, list-keepers and those who watch them form one of the world’s biggest and least noticed industries, the trust business.
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Now imagine a parallel universe in which lists have declared independence: they maintain themselves. This, broadly, is the promise of the “blockchain”, the system which underlies bitcoin, a digital currency, and similar “distributed-ledger” technologies. If blockchains take over, as fans are sure they will, what are the implications of the trust business migrating into the ether?
It would not be the first time a novel form of list-making changed the world. More than 500 years ago a new accounting technique, later known as double-entry book-keeping, emerged in northern Italy. It was a big step in the development of the modern company and economy. Werner Sombart, a German sociologist who died in 1941, argued that double-entry book-keeping marked the birth of capitalism. It allowed people other than the owner of a business to keep track of its finances.
If double-entry book-keeping freed accounting from the merchant’s head, the blockchain frees it from the confines of an organisation. That is probably not what Satoshi Nakamoto, the still-el...