Stay N' Alive

Innovative Growth Strategies
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Monday, June 2, 2014

I'm Writing Minecraft For Dummies, and This Time it's a Family Affair

Hi, my name is Jesse Stay - I'm writing Minecraft For Dummies and Minecraft Recipes For Dummies, and yes, I'm officially crazy (but loving it!). I guess you could say I'm now addicted to writing books.

When I first started writing my first book, I'm on Facebook--Now What??? with Jason Alba, I thought I was crazy. Then, I started writing FBML Essentials, and I thought I was even crazier. I then wrote Facebook Application Development For Dummies, then Google+ For Dummies, and following that Google+ Marketing For Dummies. We did a Second Edition of I'm on Facebook--Now What???, this time targeting marketers, and following that I wrote the Facebook Development section of Facebook All-in-One For Dummies. That's 7 books! At this point I think I'm a professional crazy person, and I'm getting pretty used to it.

That's why I jumped at the chance when talking recently with Wiley to write the full version of Minecraft For Dummies (link to come soon). I'll also be following that up with Minecraft Recipes For Dummies (also link to come soon), both scheduled to be finished this year. I mean, who can say they actually get paid to use Minecraft? That's definitely not crazy.

I'm joining up with  the fabulous Youtubers, Team Crafted, on this one, and will include sections from Jacob Cordeiro's (who I'm told is a very mature 15 years old!) Portable Edition of Minecraft For Dummies. What I'm most excited about though is my 12 year old son Thomas will be writing the majority of the book (his name will be on the cover with me, Team Crafted, and Jacob Cordeiro), with me filling in the gaps, and I'll also have my 10 year old son Joseph contribute little "tips" here and there (I'm going to suggest to Wiley we call it "Joseph's Corner"). It will be a book about a game played primarily by kids, written by kids, and an occasional blip or two from me, the adult (I'm also in charge of getting it all in a format consumable by the general public). I'm so excited to bring my kids into the process of writing books with me!

With a movie on the way, entire LEGO sets built on the brand, entire communities built around the game, mods for the game, and new updates coming out to the game weekly, it is a prime time to be publishing this book. Minecraft is truly taking the world by storm, and chances are if you have kids, or you feel like a kid like me, you're very familiar with the game!

With my previous books all being on social media, the next 2 books will be a fun break for me as I focus on my family, and finally make book writing a family affair. Expect to hear more for me here, as well as on Facebook and Google+ as I make progress! Also, I'm looking for schools and the like that are interested in learning about the book writing process as we write this book - please contact me at jesse@commercefuturists.com for further inquiry. I'm also happy to make Comic, Gaming, and Fantasy Con appearances (I can also bring my sons)!

I want to know though - what would you like to learn in a Minecraft book? Go ask your kids. What do they want to learn? As parents, what interests you? Please feel free to share thoughts and ideas in the comments and maybe I'll find a way to include them in the book.

Wednesday, May 28, 2014

Ford's Future Competition Won't be Cars - It Will be Software

Google gave us a peek into its future and vision today as it announced, and showcased new, Google-designed cars that are built entirely for driving on their own, without humans. The future indicates, to me not that Google is building its own cars as one would expect to be competition with companies such as Ford, Chevy, Toyota, and others, but that Google is sticking to its core strength and vision - software that makes the world more openly available to everyone. The future, my friends, for the automobile industry isn't cars - it's in software that gets you from one place to another - it's all about Google Maps, and competitors to it.

As I visited Silicon Valley recently with my wife as I attended Facebook's F8 developers conference, I had the opportunity to briefly stop by Google Headquarters in Mountainview. The one building that greets you, and says goodbye to you as you leave likely isn't noticed by everyone. It has a big, teardrop-shaped marker in the front, and a couple Google maps and other types of cars in front. It stands practically across from the Google Android building with all the dessert statues. That building is the home to Google Maps, and I'm now thinking it is not a coincidence that it is one of the first and last buildings you see on Google campus.

Google's Entrance Into the Collaborative Economy

My very smart friend, Jeremiah Owyang, as I've shared numerous times on this blog, is becoming well known for coining the phrase, "collaborative economy", a future (and now present) where people no longer just share virtually with each other, but in real life through things like cars, homes and places to stay, and even real goods. In Chicago recently I got on my phone, connected to the Uber app, and it showed me a host of normal operators using their own cars to give people rides from the airport to their destination. As I toured the city, a company let me "borrow" a bicycle from one of many "Divvy bikes" and get around the city where I was able to tour one of the tallest buildings in the world and see Monet paintings at the Chicago museum of fine art. Jeremiah is most definitely onto something.

Companies like Ford and Walmart and others are taking notice to this new trend, many starting to partner with the likes of Uber and AirBNB (a service that lets people rent out rooms in their homes), and others. Some even creating their own similar services to empower and encourage people to use their (the company's) products which those people own. The problem, I fear, is that in the end this is not the essence of where the collaborative economy is taking us. Google gets this, and I think we're seeing a hint of it with today's announcement.

Social Design in the Collaborative Economy

You see, the future doesn't matter about the product itself. It's about what the product can do for you. I've preached often about the concept of "social design" inside your product and even covered it in Facebook Application Development For Dummies. The idea is that you take the functionality of social networks and bring a person's close friends and family from those social networks into the design of your app or product (which is often entirely virtual but not always). The next iteration of "social design" is to build software that truly, and ubiquitously integrates the collaborative economy within the product itself. In a perfect, socially-designed product you can't distinguish between the "social", and the product itself. It's all one. Google is doing this with their self-driving cars.

In Google's world, no one will ever have to own a car. In fact, they won't even care if anyone else owns a car they can borrow. Google's key asset is information, not "things".  Where the cars come from won't matter. In the future you'll just say, "Ok Google, give me a ride from Chicago Midway to the Sheraton" on your mobile phone or Google Glass or desktop, and a Google Car will come, pick you up, take you to your destination as you get work done along the way, maybe even ask you if you'd like to stop for a bite to eat along the way (through a contextual, location-targeted ad by McDonalds, of course), and you'll never even have to pay for the ride. It's the collaborative economy at its finest, and the automobile industry may not even know what hit them when it does. In the end, information is always more valuable than tangible things.

The competition in the future for the automobile industry, I'm afraid, isn't the fact that people are borrowing cars from each other and taking public transportation more. Granted, that's part of it, but not the end result. The future competitor for the automobile industry is the same thing that took out many of the hardware companies of the 80s - it will be software, and the information it indexes. The key players will be software giants like Google, Microsoft (maybe?), Yahoo, and Facebook.

As the information industry makes its way into the collaborative economy, Ford, Chevy, Toyota, you name the automobile company - they will all need to develop competitors to Google Maps and others in the future if they are to survive, or at least remain as large as they are now. The big question is, is it too late? In the end, software still rules the world, and hardware just works for it.


Thursday, January 2, 2014

Growth Hacking: How to Know Who Has Viewed Your Facebook Profile

I shared earlier a method I came up with that allows you to target the subscribers (now called just "followers") of a public profile on Facebook (you know, the profiles with the "follow" button like mine at facebook.com/stay - not to be confused with a business page). It turns out that you can also use this to not just target ads to, but learn about the subscribers of those profiles as well. For instance, I can tell the approximate salary ranges of my followers on Facebook. Let me share how.

If you go to my previous article on the topic, I show you how to create a list of the subscribers of a profile. The same can be done for the friends of a profile, the attendees of an event, members of a group, and many more "groups" of people if you know what you're doing - do some research of what data is available (I have a book that can help), if you want to dive deeper. Go ahead and create this list, and then go to Facebook's Power Editor where you would have created your ad targeting these people.

Previously I only talked about targeting ads to these people. You can actually get very specific in targeting only sub-groups of these followers, allowing for much more targeted ads in the process. But you can also use Facebook's Power Editor to just learn more about your audience. This can be a great way to know what types of things the audiences of individual profiles in your brand are interested in.

For instance, if I go the Partner Categories (under "Audience" when creating or editing a new ad in Power Editor), and select "Acxiom", then "Personal Finance", and then "Income", I can select any income range. If I select the $100,000-$125,000 range, in the right column it tells me an approximate number of people amongst my followers that are in that range. As you can see, the majority of my audience makes less than $100,000! If I were representing a brand, this would tell me how to price any products I sell to my audience of followers.



You can segment it any way you want at this point, just as you would a typical Facebook Page. Find out how many of a public profile's followers/friends buy baby products. Find out how many of a public profile's followers/friends are Republican/Democrat/Independent/etc. Then if you follow the advice in my previous article you can target ads to these individuals!

Okay, I fooled you a bit with the title and you can't really tell who's viewed the profile, but you can tell at least anonymously those viewers that have clicked the "subscribe" button on your profile, or learn more information about the friends of any profile on Facebook. For brands with influencers representing them as public Facebook profiles, this can be a very useful way for those brands to allow those influencers to keep a personal profile without having to have a duplicate Facebook Page.

Previously, I showed you how to create ads using this method. The cool thing with Facebook ads is you don't have to create ads to get benefit. The ads interface itself, and in particular Facebook's Power Editor, is a great learning tool to get approximations of an audience, and to learn more about who you should be targeting and how to target better - use this to your advantage as a brand as you engage your employees to use Facebook more as ambassadors for your company (through tools such as EveryoneSocial). Then use ads, and your own products to prove those theories.

Have another good use of this? Share in the comments!

Let me help your brand! These little "Growth Hacks" are the core of our business, and how we excel against other marketers and firms in this space. If you want to get an advantage against your competition that other marketers can't touch, send an email to jesse@staynalive.com!

Oh, and like what you see here? Did it help your marketing strategy? Please consider sending donations to paypal@staynalive.com (Paypal), or send me Bitcoin!:

Address: 19AdCAbjshRuEFhx4py1Ny7i48s1d6RFi

Wednesday, December 18, 2013

Bitcoin Use-cases: Turning Bitcoin, Cryptocurrency, and the Blockchain into a Fully Functional Peer-to-Peer Internet

A lot of non-Bitcoin investors and people with little knowledge of Bitcoin are freaking out right now about the fall of Bitcoin's value in the last 24 hours due to China forbidding deposits into their main Bitcoin exchange. I'm actually kind of excited about it, because I think of Bitcoin as more a protocol than I do a currency. This means it has long-term sustainability. It also means my investment into it is a much more long-term investment into the future of the internet, as a whole. It means I now have an even greater opportunity to buy until the world grasps onto this concept. One of these use-cases is the possibility of completely replacing the internet as we know it. Let me explain.

DNS

Let me start with an example. An exact duplicate of the Bitcoin protocol with a separate blockchain, Namecoin (read all about it here), was created to prove some of the points I'm making here. Namecoin was invented to allow the use of its own Blockchain (remember, the worldwide, public accounting ledger for tracking transactions) to track ownership of domains on the .bit namespace.

Domains and DNS are in essence based on a peer-to-peer network of their own, with one major flaw. They rely on a central authority called the Internet Consortium for Assigned Names and Numbers (or ICANN) to tell other DNS nodes who owns the domain being queried. When you type in a URL into your browser, it likely searches your ISP's DNS servers (your computer is in essence itself a DNS node that knows to talk to your ISP and other DNS nodes on the internet). Those DNS servers communicate with other DNS servers and so on until they find out who the owner of the domain is. Once the owner is determined through ICANN, your browser knows to pull content from "X Server" and you are delivered a webpage from that server. With Namecoin, however, ICANN isn't needed because the ownership is recorded on the blockchain.

Namecoin, in essence, is replacing the need for ICANN in domain distribution for the .bit top level domain. They do it by storing the domain names in digest form on the blockchain (and suggest you can do this with other types of documents and text, as well), giving a permanent place to look up ownership with guaranteed authenticity. Currently they're integrating this with existing DNS architecture, providing translation of those blockchain records in a way ICANN can understand, but in the future, the DNS protocol could be updated to accept blockchain records as sufficient ownership as well. This could be done with something as simple as a browser extension or plugin on most current browsers that overrides the browser looking at DNS servers for ownership, instead looking at the blockchain for ownership.

This is a powerful concept, which shows one use-case in this potential "internet replacement". And it's already in place, and it's already working! You can invest in Namecoin now, and even convert your Bitcoin into Namecoin through exchanges like btc-e.com. (and guess what, the Chinese now don't have this opportunity, at least not to the scale they used to!)

Storage

So now we have a way to tell where to retrieve content on the internet through a peer-to-peer, Bitcoin protocol-based architecture. Now we just need a way to deliver that data in a distributed manner. What if you could use Bittorrent as the storage for a Bitcoin-powered internet? We're already headed there.

Recently, a bittorrent client called Frostwire announced they're working to integrate Bitcoin into their Bittorrent client, allowing seeders of Torrents (which don't all have to be illegal, by the way - Bittorrent, too, is just a P2P protocol, this one focused on storage) to pay and receive Bitcoin for files. I think this could go further though. What happens when you can associate something like Namecoin with an address of an HTML file on the Bittorrent network? Now, entirely server free, a document can be served (no server-side code required in this case - JavaScript has become quite powerful of recent on client machines, and could be extended even further to more powerful functions within the browser itself to embrace the blockchain and even bittorrent for more info) across a peer-to-peer network delivering documents to your browser at speeds potentially even faster than your current internet can.

As for a database, there are already distributed, file-based databases (see Hadoop, for instance). Instead of owning your own servers to store those files, why not store them across the P2P Bittorrent, or similar network? There are details to be worked out, but the technology is definitely almost there.

The Network Infrastructure

Now the only thing left is the ISP, and infrastructure for giving you bandwidth and access to your internet. What if we made this peer-to-peer as well? There are already many plans in foreign countries for "mesh" wireless networks. What if we took a concept like this, allowing anyone who wanted internet access to set up a wireless receiver of some sort, and that receiver would "pay" into the network to get access using Bitcoin or similar. These payments (this would be the equivalent of "mining" in current Bitcoin) would then go to those willing to provide longer distance wireless access using things like Ham Radio towers and the like to provide access over this entirely wireless, peer-to-peer internet. The bandwidth each node provides to the network would in essence "mine" new tokens and recycle those paid into the network in the process.

Of course, details of how all this can work still need to be worked out. Hopefully now you can see the potential though, and we're really not that far from something like this happening with very little needing to be done by any central entity (perhaps wireless laws in the USA and other countries would need to be opened up a little to the public). Many of these protocols are already being used. But once they're all put together, we have an internet that works without central authority, no need for ISPs, no need for server hosting. The entire internet experience is 100% controlled by the user, and companies will need to adapt to this.

This will all lead towards new forms of commerce. My friend Jeremiah Owyang talks about "The Collaborative Economy", which is already occurring. The idea is that the future of commerce is moving towards more social, consumer-to-consumer models instead of business-to-consumer. Businesses now become facilitators of these transactions instead of sellers of a single product that a consumer can buy.

In "The Chain" era it works the same way - no longer will we need DNS, hosting, or even storage. Ownership records will all be stored on "The Chain", all delegated to the proper owners of the content and storage and names. Businesses will need to start preparing for this in order to adapt to this new model - I'm actually seeing some of the smart ones do this now, which I'll talk about later on this blog.

Bitcoin is not just a currency as you can see. If you're seeing it as just a currency that goes up and down, you're looking at it wrong. Instead, you should be looking at it as a new paradigm. It's a paradigm shift in not just currency, but the entire internet as we know it, and you should be looking to hop on, pay in, and get on board. Those that do so now will be the leaders of this new era in the next 5 years.

My company helps businesses adapt to these new paradigm changes such as Bitcoin, strategizing new innovation and marketing shifts to gain an edge on their competitors. If you think we can help, contact us (contact@staynalive.com) - we even take Bitcoin!

Like this article and want more like it? Consider a donation! Here's my Bitcoin address:

Address: 19AdCAbjshRuEFhx4py1Ny7i48s1d6RFi


Monday, December 9, 2013

Growth Hacking: How to Target Ads to the Followers of a Public ("Follow") Profile on Facebook

I shared earlier on this blog the benefit of using a personal, "Public Profile" on Facebook over a Fan Page on Facebook to personalize the experience and grow your network. I encourage each of my clients to, when they have the choice, choose the public profile over the Fan Page for personalities in the company for the reasons I shared earlier. It personalizes the company better, and I think the opportunities to grow organically are stronger.

There has always been one downside though - you can't advertise to the followers of public profiles. It turns out there is actually a way to finally advertise to the followers of a traditional profile on Facebook with a "follow" button. It involves just a little Graph API knowledge (see my book to learn!), use of Graph Explorer, and a Facebook Page for your brand that you can use to create the ad. Here's how you do it - let me know if I can help your company or brand do the same!:

Using Graph API to Get the User's Followers

The trick involves just a little Graph API (the Facebook developer platform used to get data out of Facebook). To start, open up Graph Explorer from the developers.facebook.com "Tools" section.



Give your user the "user_subscriptions" permission by clicking on the "Get Access Token" button and checking the box under "User Data Permissions".



Now, type in the following path next to the "GET" drop-down:

jessestay/subscribers?fields=id&limit=5000



You can replace "jessestay" with the id of any public user. The limit=5000 lets you traverse through the more subscribers at a time. Hit "Submit", and a bunch of data will be returned.

Now is the part you need to figure out, and where a little programming knowledge might help (I may upload this as a tool on SocialToo.com at some point if it makes sense). Each page has only 5,000 subscribers listed, but there is a "next" link at the bottom that takes you to the next 5,000 subscribers. Your job is to traverse through this list, follow all the "next" links until there are no more, and extract a list of facebook ids in a text file (csv or txt). You can do this either manually or through an automated script that you create



This script took me about 15 minutes to write on my own, so it's not too difficult a task if you have a little programming knowledge. Of course, this is also a service I provide to my clients so let me know if I can help! Once you have this file, you're ready for the next step!

Uploading the Followers to Ad Manager

Now that you have your file, you need to upload it to Ad Manager as a "custom audience". This used to only be available to Facebook's Power Editor, but it's now a native piece of the Facebook Ad management experience.

Start by going to http://facebook.com/ads/manage and make sure the account you're using is selected (for those that might manage multiple accounts like me). On the left is a link that says "Audiences". Click on that.

Now, click on "Create Audience". A dialog box will appear - select "Data File" from the dialog box.



Now name your audience whatever you like, and choose the file you just created in the above section. If it's a text file that has a Facebook ID on each line of the file it should work. Also, make sure you select "advanced options" and "user ids" so it recognizes your ids as Facebook ids and doesn't try to read them as email addresses. Click "Create Audience", and now your custom audience should be created! Pretty quickly you'll start seeing the number of potential people you can target show up next to the audience stats on this page.



Creating Your Ad

Now that you've created your custom audience out of the user's subscribers, you just need to create an ad that targets this custom audience. This is where you'll need an existing Facebook Page for your brand (Not the user themselves - to me Facebook Pages are for brands. Facebook Profiles are for users!) if you want to do a promoted post. If you don't want to use another Facebook Page you can just do a right-nav ad that targets a URL and that will work too.

Start by creating a promoted post using Ad Manager, or on the Page itself (don't use the "boost" option!). You can make this visible or invisible to your fans - it's up to you. Include a link if you like, just text, or whatever you want. Maybe even put the image of that user in the post so it's recognizable to the fans of that user. Another option is to have your Facebook Fan Page share a post of that user, and then you can promote that!

Then in your targeting options, select the custom audience you just created. You can further refine the audience if you like, should the post be needed to target a specific subgroup of that audience (allowing for much stronger micro-targeting and perhaps even better results for less cost). Set all your bidding options, submit the ad, and now you have an ad targeting all the followers of a specific user on Facebook!



The great thing about this is you don't have to limit it to subscriptions - it works with any data your user has access to. You can access your friends, your friends' friends. You can target the attendees of an event you're going to. Or members of a group you participate in. You also don't need to limit it to your own user if you're targeting just followers. Because public profiles are public, you can target the followers of any user that has their profile marked as public!

Just a side-note: I did notice a bug in Facebook's Graph API that doesn't return all of the subscribers. I think it excludes subscribers that are subscribing to you through Facebook lists. It will return most though, which makes an ad campaign totally worth it!

So when you think you have to use a Fan Page because you can't advertise on a public profile, think again! You indeed can target subscribers of public profiles on Facebook, making the use of a public profile even more powerful, and something every brand should consider!

Let me help your brand! These little "Growth Hacks" are the core of our business, and how we excel against other marketers and firms in this space. If you want to get an advantage against your competition that other marketers can't touch, send an email to jesse@staynalive.com!

Oh, and like what you see here? Did it help your marketing strategy? Please consider sending donations to paypal@staynalive.com (Paypal), or send me Bitcoin!:

Address: 19AdCAbjshRuEFhx4py1Ny7i48s1d6RFi



Monday, November 25, 2013

The Blockchain and the "All for One, One for All" Demise of the Centralized Server

It's amazing how history repeats itself. Internet history began with the conception of room-filled mainframe computers and "nodes" that would connect directly to the mainframes relying solely on the power of the central mainframe to get their signal and perform various tasks sent to the mainframe. Then came the PC era - an era where every person could have their own computer, and the processing power occurred on the same machine as the display and input device. Following that came the Internet, or World Wide Web, which combined mainframes and servers with personal computers. With the internet, mainframes and servers could be used to connect PCs, all over the world, in a distributed network of various servers all communicating with each other, and relaying information back to the client, the PC.

With the Cloud, we're back to relying on servers, and we're relying more on central data storage and processing more than ever before, just like the days of the mainframe. The only difference is our current "dumb terminals" can also cache pieces of information and perform mini processes to reduce the need for internet bandwidth in the process. All of that is about to change though with "The Chain" era as I call it, cryptocurrencies, and blockchain type infrastructure. In this era, we're moving from lots and lots of servers all over the world, to one single server, distributed across multiple clients (or terminals) all doing their fair share of the processing.

With Bitcoin, I've talked previously about the power of "The Blockchain", a global, worldwide accounting ledger that gets audited over and over again by a massive network of peer-to-peer computers, or "miners" to verify the chain has not been corrupted in any way. This network, as I stated earlier, when put together as a whole, is more powerful than the top 500 supercomputers in the world, combined. The network was designed this way.

In Satoshi's whitepaper where he proposed the Bitcoin protocol, he suggests "as
long as a majority of CPU power is controlled by nodes that are not cooperating to
attack the network, they'll generate the longest chain and outpace attackers". As a result, it's to Bitcoin's benefit to have a very large pool of honest miners, preventing the possibility of another majority outnumbering the honest miners and providing a false version of the blockchain. This makes for a very, very large public "server", with lots and lots of computing power, that anyone, and anybody can rely on without the need for central companies, corporations, and even governments in many cases to provide that service with their own powerful servers. In many ways it means it's near impossible to "lie" or "spoof" inside this type of network!

Imagine the opportunities this opens up. Server resources, DNS, hosting, and even storage servers are no longer a necessity. Instead we can all rely on "The Chain" to access this information. If I own a domain, that record exists on the Chain and the Chain can verify I own it, and any IP information that comes with it when a browser makes a request for that domain. Perhaps IP addresses will no longer be needed at all with the Chain - after all, servers won't be necessary and I really believe this massive network could be used for storage as well. So maybe your browser also gets knowledge of another key on the chain that contains the content of the webpage.

Of course, all this is theory, but the implications are evident. I'm still weeding out how a lot of this could work in my mind, and so are many, many others. The potential is there though, and we already have the largest supercomputer on the planet that we could be using - the Blockchain used by Bitcoin - we just need to come up with new ways of using it (and many are), and identify the flaws so that we can either fix them, or come up with a new protocol without those flaws. One thing's for sure in my mind - centrally-controlled servers, in the future, will no longer be necessary. Instead, we will all rely on a massive, P2P network of some sort - be it Bitcoin and the Blockchain itself, or some other open and distributed cryptocurrency model adapted to allow this stuff.

The collaborative economy doesn't apply just to goods and services. It also applies to technology.  The future will be less of a "one-to-one" or "one-to-many", and more of an "all-for-one", "one-for-all" model where everyone benefits that participates, and there is no fraud in the process. In the coming weeks and days I'll share some potential use-cases for this Chain to further show some of its potential. What other use-cases can you come up with using the Chain?

Like this article? It's freely shareable and can be copied and distributed (or linked to) via Creative Commons Attribution license. Or, just send a tip via Bitcoin!:

Address: 19AdCAbjshRuEFhx4py1Ny7i48s1d6RFi

Friday, November 22, 2013

First the PC. Second the Web. Third the Cloud. And Now...The Chain - Why Bitcoin is Not Just a Currency - It's a Platform!

What if you could transfer stock to another individual, without a stock broker or stock certificate? What if you could sell your home, without a real estate broker or deed? What if you could sell your car without need for a title or vehicle registration? That's the concept of the technology behind Bitcoin, and why you need to be paying attention to why this is so much more than just a currency or investment, and why your brand could be disrupted soon if it does not adapt.

The technology behind Bitcoin, the currency that is making little-known software developers millionaires as the price has gone from less than $1 per Bitcoin to $800 per Bitcoin in just a couple years, has the potential to revolutionize the way the world authenticates human-to-human transactions within a matter of years. The technology, or protocol, is called "The Blockchain", and it has the potential to be so much more than just a currency-driven protocol. It's an entirely new platform. "The Chain", as I'm now calling this platform, is incredibly powerful, and I truly think it is a paradigm shift on par with the shift from the mainframe to the PC, the PC to the Web, and more recently the Web to The Cloud.

"Colored Coins"

I had the chance to sit down with some of these Bitcoin millionaires and soon-to-be-millionaires (I'm not exaggerating!) at a local event in Provo, Utah (organized by my friends from the upcoming documentary, "Life on Bitcoin") called a "Bitmob". The idea is this (in a nutshell): a group of Bitcoiners approach a local business and tell them they will bring x number of people willing to pay with Bitcoin if the business will be willing to accept it. It's a great way to get businesses to start accepting Bitcoin as a currency, brings a lot of new customers to those businesses, and overall improves the economy of Bitcoin as a whole.

It was at this meeting that my mind was enlightened that Bitcoin is not just a revolutionary, worldwide currency without central control, but it is so much more than that. A group of developers in the Bitcoin community have proposed an addition to the Bitcoin protocol (introduced by a pseudonomous developer named "Satoshi Nakamoto" in 2008, but with precedence in other standards and technologies prior to that), which allows each Bitcoin transfer to contain a payload of text. They call these "Colored Coins". This payload of text could be synonymous with writing on a $1 bill the words, "I'll give anyone who gives me this bill a car". Then, that person would be held to giving each person that gave them that $1 bill a car. However, attaching this to an encrypted digital transaction that can be guaranteed as authentic, traced between the sender and recipient (by code, not necessarily ID of a human - one fatal flaw in Bitcoin IMO), now you have an even more certain guarantee of that agreement that the entire world can audit and ensure took place. If it is dishonored, the entire world knows (instead of just the people that gave the individual the $1 bill). See this video to get a better idea of how their proposal works - it does a much better job explaining:


Bitcoin is Just One Implementation of The Platform (The Chain)

The power of why this is possible lies in a worldwide "ledger" called "The Blockchain", basically a ledger similar to an accounting ledger, that each bitcoin client has access to, can't delete, and proves the transaction takes place. Because the entire world has access to this ledger, there is no mistake in the transaction, and anyone can prove that the owners of the 2 sides of the transaction are in agreement with each other.

The power of Bitcoin is in a vast, worldwide network of connected computers that can all authenticate what agreements were made from which parties. Each of these computers performs computer algorithms to ensure the strength of encryption on each transaction, further ensuring its authenticity. I'm told that if you added all this computing power worldwide, it would equal the power of more than 500 of the world's top super computers. The number of trades on the network, today alone, outnumbered the number of transactions on Paypal, and are soon to outnumber the number of transactions by Discover Card.

The sheer number of participants in this worldwide peer-to-peer network, the value attached to each transaction (in Bitcoin - the Bitcoin-to-Dollar ration today is approximately 1/$700 and growing), and most importantly the openness of the network, the Blockchain, and the protocol behind it make this new network designed for commerce as scalable as the Internet, and perhaps even more valuable. As you can see, it can also be used for more than just monetary trade. One individual is using it for authentic transfer of files between individuals, for instance.

The thing is it's the idea of Bitcoin and the Blockchain that makes all this so powerful. There will be numerous additions to the protocol over time, and I'm sure other versions, making this concept more and more powerful. What's powerful isn't that Bitcoin exists - it's that this is the direction it is taking us as a society, and the technology exists today. For that reason this is a very large platform that will have many components to it, just like the web has HTTP and TCP/IP and MAC addresses, and even OAuth, and OpenID that all work together in one. We'll see the same with cryptocurrency and online commerce in ways that transform commerce and corporate structure as we know today. There are already other cryptocurrencies like Litecoin and Namecoin. Devs and businesses will create their own currency exchanges (I'll explain that in another post).

Bitcoin is Much More Than Just a Currency

For that reason I see Bitcoin as much more than just a currency. Bitcoin is an open platform designed for commerce. It is the architecture and Infrastructure for all transactions that Jeremiah Owyang mentions in the Collaborative Economy philosophy. Whether in "colored coins", or another standard, Bitcoin, and cryptocurrency in general, are the platforms that will power every guaranteed human-to-human transaction on the planet. It's already globally recognized. Each transaction has an intrinsic value (Bitcoin itself is limited in number, giving it rarity, similar to Gold). Each transaction can be proved, with 100% accuracy. And it's near impossible to forge, unlike traditional currency. And what's even better is this is all a platform which will evolve and grow, just like the internet.

Bitcoin is what happens when you apply digital and cryptographic principles to accounting. This is as big a change in technology to come to the world as the PC, the Web, and most recently the Cloud. We are entering a new era of human-to-human commerce where the brand, and the government is no longer "the middle man" in these agreements. Is your business ready to handle it? Are we pushing our governments to adapt? I'll do some articles shortly on ways brands can adapt, and what I'm telling my clients.

Want to know more about Bitcoin? This video will get you started!:


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