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April 19, 2013


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Paul Peters

What if the mobile cloud, BitCoin and BigData mix and every trade transaction can be registered and processed in real time? Say, if every trade would generate a tweet. How much data would that be entire daily volume? Visa processes 82 billion transactions per year during 2012.. if we overestimate that with a factor 100 to correct it for a global system then we have a daily volume of some 25 billion transactions. With a twitter sort envelope that is a daily volume of 25 terabyte. The costs of a terabyte Solid-state-drive is less than 500 EUR. So, with a bunch of graphical processing units for vector processing and such disks, for some 100.000 EUR you'll have the hardware to build a system that can process every financial transaction in the world in real time. High-frequency trade in an information rich Keynesian world.. where every item acts like its own security. So, if such a network with instant mutual valuation or several of these come into being, at what level of complexity would such a decentralized model replace the role of money, or at least move it away from the use of currencies and/or banks? At around 2020 your mobile phone can deal with terabyte scale memory.. in 2030 it can deal with a factor 1000 more.. Information processing is catching up with the processing of value, and it is taking over. This is clear on localized supernodes in the network, such as the Chicago stock exchange... but what is going to happen with the two merge? When it is not just information /about/ trade anymore, but the information processing and the trade and the processing happen without a noticeable delay and the whole world is one big interconnected bundle of self-describing derivatives without the need for any centralized processing anymore?


Of the businesses that deal in retail, banks are typically the ones most divorced from their customers. This is in part because the product at its core is so solid and definable that it doesn't need an understanding of the customer to work. e.g. money. It's also in part because of the oligopoly subsidy structure of the industry - banks don't need to know to survive.

But consider that once upon a time, know your customer meant that the branch manager actually knew every customer in the bank. Personally, and he would meet frequently. These days it means something completely different, something to do with data, and people know their call center with angst. Consider also when supermarkets start doing banking, this makes sense to customers but no sense to banks. Who's right?

Social media is just what people do -- this decade. The problem isn't being involved with social media, it is being involved with people.

Paul Peters

it's not just "social media", it is big data mixing with mobility which gives decentralized business intelligence where processing power is such that for every geo-location at any given time bartering systems can be valuated and exchange quota can be generated for any combination.
Money is its own "adjacent possible".. it is a local maximum of interchangeability but it derives its value from its level of entanglement with local trade networks.. and so it is an intermediate good. With mobile allowing for big data (and big function?) to be everywhere at the time needed, the need for money as such will increasingly disappear in favour of enacted procedures.

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