Big data and the Future of Money (World Big Data Congress 2013)
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Transcript of Big data and the Future of Money (World Big Data Congress 2013)
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BIG DATA AND THE FUTURE OF MONEY
Daniel Austin,
Principal Architect
PayPal, Inc.
2nd World Big Data Congress
London, UK
June 27 2013 v1.3
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Today’s Talk
Big Data is King
Big Data and Money
The Future of Money – Three Predictions
And the usual disclaimer – these views are my own and not necessarily those of my employer.
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Ben Chaim - fotolia
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BIG DATA MAKES ALL THE DIFFERENCE• The real Big Data problems are only now becoming
evident – in Media, Finance, & Administration• It’s not an accident that these problems are surfacing
now, just as we are able to bring the tools online to solve them
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BIG DATA LETS US ASK BIG QUESTIONS• Are you a Big Data problem?
–How much data will you generate over the course of your lifetime? (~ 5 petabytes)
• How much of human behavior is predictable?–At what scales?–The answers may make us
uncomfortable• How much control can we have over the
Big Data about ourselves?
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BIG DATA + BIG MONEY = BIG CHANGES
We can know more about what’s happening now
We can store it and manage it for a lot longer
This allows us to know more about the past
in order to better predict the future
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MONEY IS A MEASURE OF ORDER• We add order to the
system by doing work on it – adding value by opposing entropy
• Big Data is a means of imposing order on large volumes of data
• Taking the friction out of payments increases their value
• Predictability also contributes to stability
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Monetary Digital Encoding Methods
Bitmint• A means of digitizing the
value of money (in existing currencies)
• Respects the sovereign currency system – transparent and credible
• Allows for digital storage and transfer of funds
• Focused on cryptographic security and associated metadata
• Reduces anonymity
Bitcoin• Virtual standalone
currency• Lies outside the
sovereign currency system
• May be subject to instability
• Irreversible transactions offer high levels of anonymity – but at high risk
• May not enjoy the trust factor associated with nation-based financial systems
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CURRENCIES AND CURRENCY OVERLAYS• Commercial services offer a ‘currency
overlay’ facility– Allows for the free flow of digital money while
preserving the distinctions between currencies
– Reduces ‘friction’ in payments, accelerating the flow of money globally and locally, perhaps at different rates
– Big Data facilitates this ability, allowing us to manage these flows in a secure and stable way
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PRIVACY & SECURITY AS COMMODITIES?• Our ability to process Big Data problems
will open the door to recording a great deal of personal information
• As the value of security and privacy goes up, they will naturally come to be sold on the market
• How much of the data about your behavior can be kept truly private, given our ability to collect and manage large data systems?
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EVOLUTION: MONEY AS AN APPLICATION • Digitally encoded currencies are only the
first step• Need to add application functionality
– “Object-oriented Money”– Encapsulate data, business rules – May include its own models – Allows for indeterministic behavior
• Conditional Money– Tied to a specific purpose or intent
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SELF-AWARE MONEY?
What if you wanted to send $1000 into the future, say 1,000 years?• We need a means of preserving and
transferring value across longer timescales than existing currencies allow
• By giving money autonomy and conditionality we could enable action on our behalf over long periods of time.
•
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PROGNOSTICATION - TIME HORIZONS 2
5-50 years
• National currencies become fully digitized
• Acceleration of money leads to acceleration of development
• Long-term autonomous financial instruments
5 -10 years
• Money as an application
• Monetary flows accelerate exponentially
• Privacy and Security as commodities
• First self-managing funds and financial models
36-60 Months
• Mobile payments continue to surge globally
• Evolution of digital currencies
• Big Data begins to blur the line between money and information
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3 PREDICTIONS:THE FUTURE OF MONEY
• Big Data and (digital) Money will become more tightly coupled as the line between money and information blurs
• Our ability to control the Big Data we produce about ourselves will be limited
• Money will evolve toward becoming an application, with autonomous, self-managing long-term behavior
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BIG DATA AND THE FUTURE OF MONEY
Daniel Austin,
Principal Architect
PayPal, Inc.
2nd World Big Data Congress
London, UK
June 27 2013 v1.3
Thank You!
[email protected]@daniel_b_austin
The future of money?