By Mark Smalley (This post originally appeared on

Economical Forks

We are nearing an important epoch in economical evolution that has the potential to be forked forever! The financial institutions that we know and recognize today are standing at the edge of their own demise.

The spin-doctors have been getting rich at our expense, in-turn crafting an intricate concoction of bull-shit fabrication such as quantitative easing, which when fueled by the never-ending pursuit of the American Dream has led to an accumulation of physical assets that derive their value (to the next schmuck) from the institutions that continue to suck us dry from our hard-earned cold and currently traceable cash… I’ve had enough and want to do something about it. Fortunately, for once, I’m most certainly not alone…

With a market-cap now exceeding US$2 Billion and twice as much value as the whole of Maldives, Bitcoin is a force to be reckoned with. For more information on Bitcoin, please see an introductory presentation I gave at WebCamp KL (getting 26K views in 2 days).

However, I’m not here to dive too deeply directly into Bitcoin, but I must admit that it has re-confirmed previous suspicions that I once had. Data is most certainly a commodity, so it goes without saying that BIG Data is currently the most valuable digital commodity available, or at the very least, it is the most easily quantified “digital” commodity that the vastest majority of people can all agree has value.But if we already accept that quantifiable user-centric information has value, how valuable does that information become when it is also tied directly to the process of that same user’s financial transactions? Who currently owns that data?How does the power of that ownership differ from those printing our fiat currencies and what they use it on…?

It’s a well known fact that the most valuable commodity Facebook owns is you, and your personal data. If they are valued at over 60 billion dollars, and just hold information about your cat, imagine what other institutions such as your bank and credit card agencies hold.

” Although the future of Bitcoin may well be clouded, especially with the current strain of acting as both a commodity and a currency, the future of digital currencies and decentralized banking is just about to begin … ”
John Mayo – CEO of DC Bank Asia





And it’s this very subject that Perfectsen wanted me to cover, perhaps because of Brett King‘s tweet:

@BitCoin is being called a bubble, but it’s still the fastest growing currency in the world!



You may ask why this is such a big deal, who’s Brett King…? He wrote Bank 3.0 and is heavily invested into the re-imagining of banks. He recently launched Moven and has built his career upon a series of insights as to how the banking industry needs to change. The thing with BitCoin and any other decentralized currency is that they are not here to help the banking industry. They are here to replace it.

This can only happen (at the moment) if it is not only decentralized, but unfortunately, it also needs to be based on cryptographic proof.

Potential Impact of Cryptographic Currencies on Current Financial Institutions

In a nutshell, our current financial institutions are fooked, but this is a good thing…

BitCoin has set a new standard and proven that a decentralized digital monetary system can work – in fact, it being decentralized is the only reason it is currently working. Other digital currencies have come and gone, but none have ever been decentralized, and that is what makes this new era of economy so interesting. For those still a little uncertain as to what a BitCoin really is, take a look at this video:.


Best case scenario is that our current financial institutes finally have to act upon what a piss poor job they’ve been doing, get the strength to pull their fingers out of their greedy ring-holes and actually look to help us.


Best case scenario is that our current financial institutes finally have to act upon what a piss poor job they’ve been doing, get the strength to pull their fingers out of their greedy ring-holes and actually look to help us.Worst case scenario is that something comes along that changes everything, and gives new hope to new generations, in-turn causing a collapse to our current economy and kick-starting a new one.Both sound good to me, and either way, in some cases, when things get really bad, a total system-wide reset is the only way.Just ask Noah and his two giraffe :-)

If it’s good enough for the Winklevoss twins, it’s good enough for me and despite it’s recent crash, Silicon Valley VCs are placing bets.


90% of financial transactions are performed online and yet banks allocate less than 5% of their resources to IT departments and online services, with the majority of innovation being outsourced!



But where is the value of data derived from…?

In all honesty, the real reason I finally found myself making time to write this was because whilst sitting at KFC three days ago, I suddenly came to realize Bitcoin had reached mainstream status. Two days before that, my mum had sent me an email about them. The first email I had gotten from her in over a year. That very morning, I had also received an email from my brother and my wife about them and getting emails from them was a regular as my mum. Ten minutes before that my dad had Tweeted about them, and right now, in this moment of revelation, my 3 year old daughter was jumping up and down yelling Daddy is a Bitcoin, Daddy is a Bitcoin!

My father sent me another email this morning, where he admitted that his only concern was that he could not understand from where the value was derived. Like any data – it’s true value is predicated by those using the data and the value of what they are using it for…

When we track online user-behavior, click rates, measure A/B tests and perform other analytical methods to give specific value to data, we use resources to do so. More hardware to hold the data, more engineers to massage the data, and more specialists to make sure everyone is doing their job correctly. Making use of this data has a cost – as does the creation of a Bitcoin, which is undertaken by miners.

Value comes in many forms… For drug-dealers and prostitutes, the benefits of a potentially untraceable method of transaction that is not regulated or taxed are quite obvious. For those living in developing countries who do not have the same luxuries as those in the west, such as functioning payment gateways, the benefits may not be quite as obvious, especially for those that have options other than PayPal. For the rest of us, it provides hope and allows us to play on the same international stage as everyone else.

If you’re looking for a little perspective, just ask someone from East Africa how they feel…



For example here in Rwanda, virtually no one has a Visa or Mastercard. If you think getting a Visa card is hard in Rwanda, getting a merchant account so you can accept Visa payments is a whole different story.



” The amount of energy used to mine Bitcoin right now is the same energy needed to power 30,000 homes and this is part of the intrinsic value story … ”
Max Keiser


Q). What does this have to do with BIG data…?
A). Isn’t decentralized data the biggest data of all…?

The intrinsic value of BitCoin helps to illustrate that even decentralized digital currencies have underlying costs, not to mention a whole host of value that is derived from different people in different ways. They are merely the underlying costs, and provide a basis from where each of us choose our own value in the same way we do with any data.

Now imagine if we combined the creation of this currency with something noble such as the search for extra terrestial life:



Imagine if the numbers that miners were crunching had value outside of their speculative state. Real world problems solved, with the left-over byproduct waste and (or) confirmation of its creation acting as a source for currency.

Perhaps this is why Google started Spanner :p

Need I say more…?

Real value is a delicate term, but one thing we know for sure is that collecting and processing data is not cheap, but printing money is, especially when you simply print more to cover the costs of actually printing it in the first place… Bringing us to our illusions

The Illusion of Wealth :: Governmental Love Affairs

If you’re not entirely sure what kind of trickery this quantitative easing is, have a quick read of Ellen Brown‘s blog first, or Michael Snyder‘s article on the Business Insider. Essentially, what’s really happening is that society’s current grasp of wealth is in most common cases directly linked to physical assets and a series of regulations put in place by the people who also tax us.

If we’re really lucky, we might even own some land, but deep-down, surely we realize the truth?

And then there’s what real investors call wealth. It’s a lumpy shiny rock that looks kind of pretty once buffered-up…

I think they call it Gold…?


I see a future where the amount of data we own reflects our wealth, and it starts with our own personal data – or the personal data of others. This is something that the BBC briefly touches upon, which is further and more clearly defined by Jason Kolb:

One of the reasons I love data is because there’s so much potential for mining real value from it, especially when you combine it with other, new data sources. In fact it acts a lot like a traditional commodity such as copper or wool in that someone produces it, and then someone else buys the raw material and makes something new from it.







How can we mine value from our own personal data, and what will it take for that data to be exchanged into legal tender…?

Tirath of Acunu and lead-organizer of Big Data Malaysia believes we may be closer than we think to such a reality:

It may not be too long before the respondent panels that are the bread and butter of market research firms today are replaced. Switching from survey questionnaires to passive data feeds could allow users to agree to have different areas of their lives tracked at specified times or conditions by some universal API that market research companies could bid on in real-time, making each user’s personal data a commodity that may be economically valuable…








Until then, we look to place all our trust into the governments that have promised to protect us.

At what cost does that protection come and who really benefits…?