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Formalizing and Securing Relationships on Public Networks, by Nicholas Szabo

For anyone who is interested in the future of information and networked society, I found this paper, written by a very early proponent of digital money, Nick Szabo, to be quite relevant. Szabo is most famous for his articles and blogs, which covered a wide range of subjects from history, economics, to cryptography–which may have influenced the development of Bitcoin. But to my delight, I have also found a First Monday paper written by Szabo on the rationales and approaches to digitizing paper contracts using cryptography, and social issues that we have yet to resolve.

This paper addresses what Szabo called the “smart contracts.” To quote what he has described as a benefit of smart contracts:

Control protocols, and the professions of auditing and accounting based on them, play a critical but ill-analyzed role in our economy. … Controls allow a quarrelsome species ill-suited to organizations larger than small tribes to work together on vast projects like manufacturing jumbo jets and running hospitals. These control protocols are the result of many centuries of business experience and have a long future ahead of them, but the digital revolution will soon cause these paper-era techniques to be dramatically augmented by, and eventually integrate into, smart contracts.

According to Szabo, “The basic idea behind smart contracts is that many kinds of contractual clauses … can be embedded in the hardware and software we deal with.” For example, when ‘company A’ sends money to their ‘distributor B,’ this transaction can be recorded digitally on public networks, but encrypted in a way that its details are only accessible by authorized persons, e.g., shareholders and auditors. That is, the public will know that company A and company B signed a contract, but the details are kept secret, as per standard business practice. This reduces fraud and increases accountability of companies; auditors will not need to rely on uncooperative (perhaps incompetent or dishonest) accountants to provide figures and thus more likely to deliver more accurate judgments on corporate performances. There are also sections discussing other forms of transactions, e.g., reputation, credit, and content rights management.

The paper may not be written in the best language, but for its raw merits in describing something truly revolutionary, I believe it has contents that will benefit information scholars.

Bitcoin In-use #4: Buying lunch

A Hong Kong food outlet has been accepting bitcoin for a while now, and is becoming a favorite among some local bitcoiners. Mr Bing, a Chinese crepe chain store, sells delicious “Chinese crepe” with stuffed ingredients. And I enjoyed their crispy and spicy Peking Duck stuffing most. Only their store in Central, Hong Kong, accepts bitcoin.

Central is the financial district of Hong Kong, and also the location of Lan Kwai Fong. the famous expats’ hangouts for drinking and clubbing. There are usually numerous people here who dressed much better and prettier than how they were born. To avoid the crowd, I went there in a Tuesday noon. Mr Bing is just about a ten minutes walk from Central MTR (subway) station. The store is nicely tucked round the corner down a side street. It is, however, difficult to miss its bright orange color.

This picture shows the store’s exterior, with a Bitcoin Group HK sign sticking on the top right corner. Bitcoin Group HK is a company that has just started installing bitcoin ATMs locally. Mr Bing has few sitting space inside the shop. I reckoned that most customers would buy and go. The cashier girl seems a little reluctant, so I did not take many interior photos.

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I looked at the menu and ordered my usual Peking Duck Crepe. The cashier girl entered my order and after I had asked for bitcoin payment, she started entering some information onto an iPad. It does take a minute or two at this instance. She held out the iPad with a large and conspicuous QR code in front of me.

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I expertly took out my phone, started my Mycelium app, and scanned the QR code. The payment amount, 0.0139 BTC, appeared on my app. I clicked “Send,” and the payment went through. The cashier girl inspected her iPad, and in less than 3 seconds, told me, “OK.” I knew the payment went through. Figure below shows my app displaying a payment of about US$5.07 being sent through the network, and also my receipt that indicated HK$49 was accepted through the bitcoin payment processor, BItpay.

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While I was waiting, I could clearly see a bitcoin ATM installed by Bitcoin Group HK, sitting at a corner within the store’s confined space, calling to be used.

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I chatted a little with the cook, a friendly Chinese senior age lady, who saw me taking photographs. She asked if I love Mr Bing. I said I do. I wanted to tell her I love bitcoin too, but paused for a while wondering if she would understand. Before I realized it, my crepe was ready!

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I love bitcoin, and the crepe as well!

Bitcoin In-use #03: Buying bitcoin in a retail store

There is a bitcoin retail store in Hong Kong! The store, operated by ANX, is tucked away in Sheung Wan, in an old Hong Kong district where you can still find trolley buses and colonial houses. The store, almost a hole in a wall, occupies a shop in an inconspicuous mall where you can find tenants like travel agencies, family owned restaurants, and a jockey club outlet (one of the travel agency actually accepts bitcoins). It is not the most glamorous of places, but it is very exciting for me! Have you seen any other retail stores selling bitcoin?!

This is how the store front looks like.

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I am aware of ANX retail store through their publicity effort a while ago, which was circulating in the Hong Kong community. Quite impressive for the nascent and highly global community.

There are two front desk assistants in the store, and let me call them Freddy and Jenny. The store was new when I visited. And Freddy had only learned about bitcoin for five days. Naturally, I sensed hesitation when I said I wanted to try buying HK$100 worth of bitcoin. Buy Jenny, having about half a year experience with bitcoin, quickly come to the assist. I waited as Jenny helped Freddy through the steps of verifying my account information. I would have needed to register for an account with ANX, with my id and all, but I had already done that with them online before I came visit.

In not more than five minutes, Jenny showed me the numbers, and she smiled for the camera.

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That is, for HK$100, they could sell me 0.01778354 bitcoins. This moment felt like a typical moment at a money changer, but with just slightly more paper work.

Freddy and Jenny then get back to the computer to confirm the trade, and handed me the receipt.

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I had expected that I will receive the bitcoins in my wallet. But instead, it will be deposited into my web account. The whole process took about 10 minutes, but can possibly be completed in 5 by trained hands. There was more paperwork than I thought is reasonable, as money changers do not require IDs if the value of the exchange is below a threshold. But it is the first retail store of a highly scrutinized artifact–so kudos to the pioneers!

How do governments keep getting bigger?

Milton Friedman had believed that governments have natural tendencies to get bigger, and bigger government means more taxes, but not necessarily a more efficient society. I am still pondering this idea while reading his book Capitalism and Freedom, and then I came across a blog post Theory Weary by a very accomplished CSCW scientist Jonathan Grudin. (And in that regard, I completely agree that HCI papers should be entirely theory-less and data-driven! –unless of course when they are framed under Activity Theory 🙂 )

I enjoyed reading the post, but I couldn’t help but keep revisiting one sentence in it, “With CSCW acceptance rates again down to around 25%, despite a revision cycle…” So we had just added more administrative work (something like a bigger government), but essentially having the same outcome? How uncanny that Friedman’s foresight seems to apply to HCI.

I have an interest in Bitcoin since years back. Bitcoin is a curiosity. As an electronic money, it can be transmitted through wires so space and time does not matter as much. As a peer-developed artifact, its codes are not governed by institutions. That way, it is valued by communities as many cultures have valued gold and silver.

Since April 2013, much have been discussed about Bitcoin in the media. There are already much heated debates out there; and I would rather not discuss whether bitcoin is a tulip or an innovation as big as the Internet itself. Instead, I would just like to use this space to discuss my own experience using bitcoin. Here, in post #01, I would like to talk about turning my phone battery bitcoin-ready.

Anything electronic has to run on gadgets. My bitcoins are stored with a bitcoin wallet app (Mycelium) on my Samsung S3 phone. When I am paying with bitcoin, I will need to activate that app. But how would I know I can use my phone when I needed to? My S3 battery had never lasted a day. On heavy use, e.g., navigating using Google map or Waze, it would be lucky to last 6 hours. Typically, I have a charge it once I arrived at my office. This makes me wonder if bitcoin is even a feasible payment medium in critical situations.

Last week, I searched on Amazon.com and found an interesting range of extended batteries for S3. The S3 stock battery is 2100mAh but extended batteries can hold a lot more charges. I picked one from Hyperion with about 4000mAh, or twice the normal capacity. The Hyperion battery is thick!

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The image above shows the Hyperion battery inserted into my S3, which had protruded out of the phone body. Check out the image below to get a sense of how thick the new battery is.

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However, when my phone is fitted with the new cover, it looks fine. I used it for a day and it fits into my pocket and on my hand quite well.

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On conservative use, the battery lasts a long time. I was not using GPS that much yesterday but was on WIFI most of the time. The battery now shows about 68% after 18 hours.

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I am visiting DC at this time, and I had used GPS and surf the web quite intensely as I navigated the city. Even so, the battery only went low (not dead) after one full day (1d 0h).

Technologically, phones can be designed to last an entire day. But why is it still commonplace for smartphone users to charge their phones in the middle of the day? Aren’t phones ubiquitous devices? If so, why aren’t sufficient battery life designed into phones’ features? An uneducated guess is that there isn’t really much at stake for the owner when his phone went dead. Smartphones are mostly used for Facebook, Twitter, Instagram, navigation, emailing, and so forth. These are not time critical tasks. But I would say that not being able to pay for food and parking tickets are pretty disruptive. To meet these needs, bitcoin wallets needs to be available for payment at all time. For me, an extended battery is currently the most direct solution.

For those interested in the subject of retail payment with bitcoin, other projects like Coinkite’s bitcoin debit card (https://coinkite.com/) and Trezor hardware wallet (http://www.bitcointrezor.com/) are interesting alternative concepts.

Resilience of (the idea of) a P2P Network

A peer-supported network can be enormously resilient. For those who are following story of The Silk Road, and how its owner, Ross William Ulbricht, was identified by FBI, you may already is aware of how Silk Road participants are planning a resurrection of the original Silk Road into many “Silk Road 2.0s.” (see Tech Crunch article, http://techcrunch.com/2013/10/04/deep-web-users-are-ready-to-launch-silk-road-2-0/)

While the Silk Road was often touted as being secure and anonymous, due to it employing a slew of crypto-encryption technologies in a purely peer-to-peer network, the identification of Ulbricht showed that it is still possible to find a person–if you try hard and long enough.

But what interests me most is how resilient (the idea of) the network is. Despite the arrest of Ulbricht seemingly marked an end of online drug trade, community members are already devising ways to further strengthen future marketplace.

“Sensorium: Embodied experience, technology, and contemporary art”

This week, I am exploring intersections between HCI and digital art research, and encountered this book edited by Caronline Jones, titled “Sensorium: Embodied experience, technology, and contemporary art.” The book was published in 2006 by The MIT Press. Some HCI folks may be delighted to find familiar authors such as Donna Haraway, Bruno Latour, and Sherry Turkle.

According to Jones (2006), the sensorium is “[t]he subject’s way of coordinating all of the body’s perceptual and proprioceptive signals as well as the changing sensory envelope of the self.” In short, it is an art’s research framework, which parallels HCI’s shifts from user-centered to actor-centeredness, to understand human agencies in a technological world. Human senses are taken as fundamental media in which we interpret our world. Many of the artwork described thus emphasized active participation through interactive multi-sensory media, rather than passive viewing (e.g., using a traditional painting).

Although I would like to see more of a societal purview in the framework, I find the sensorium approach in art refreshing. HCI is a field which emphasized the collection and analysis of empirical data, which contains past and preexisting patterns, and use it as indicators of future events. But there are shortfalls as I had more than often refrained from reading too much into the future as these are difficult to substantiate. “It is difficult to predict, especially the future,” as Niels Bohr warned. On the other hand, the sensorium approach provides much room for predictive experiments (which are also embodied and situated), which I believe is complementary to HCI’s more rigorous but retrospective methods.

“This Machine Kills Secrets,” a book on the people and culture behind megaleaks

This is not an academic book per say. But Andy Greenberg, a reporter specializing in data security and hack culture, had written the book with such details and organized forms that I find it quite useful even for my own research.

The gist of this book is this: While Wikileaks as an organization is on the decline, the infrastructure–people, technology, ideology–that created Wikileaks have remained. This infrastructure is already developing many more organizations which leak secrets.One key point he had made earlier, is that leaks are not new; there was Dr. Daniel Ellsberg’s Pentagon Papers before Manning. But today, the infrastructure has matured to make leaks easier. More importantly, the infrastructure behind leaks will not go away. Andy supported every bit of his claims with observations and interviews with both well-known and anonymous participants. Now we known that leaks are here to stay, what now?

I highly recommend this book to anyone who is interested on the subject.

“The Psychology of Art,” by Lev Vygotsky

I was apprehensive at first when I was reading this book, that was said that Vygotsky himself did not intend to publish. Nonetheless, I was new to art and I am reading books to get an understanding of art’s embodiments and meanings.

As someone who is already quite well acquainted with Activity Theory, The Psychology of Art struck me as an extraordinary work considering that it first appeared in Soviet Russia in 1928. Vygotsky, as he was sicked at the time of his writing, had no opportunity to perform empirical work. Yet his argument were made with such care that the lack of fresh data seems secondary to what we can learn from his analysis.

Vygotsky’s argument goes like this. Art was (still is to many of us) generally thought of as irrelevant to our reality. From this perspective, art is a expression of an emotion that belongs to the author. It is contagious, but not exactly useful. Yet, Vygotsky raised the question: Why are art works generally representing emotions that are lacking in immediate social reality? That is, why do we enjoy seeing paintings of nature in cities? Why do we need music of courage in the eve of battles? The reason, as Vygotsky argued, is that art works are antithesis of social realities. In daily life, whether at work or at home, there are much feelings we cannot appropriately expressed. For example, feelings of being oppressed or of morale conflict with work demands are better hidden from your boss and most co-workers. In life, there are even larger contradictions such as oppression of social classes, economic poverty, or loss of love ones. While art cannot lead to resolution of these problems, it is a carthasis, or outlet, of such feelings.

Vygotsky argument here, which leads well into his later work towards Activity Theory, is that art is not simply an emotion of the author. That emotion arises out of contradictions inherent in the social realities. These are contradictions that may be resolved, and usually would take a long time. But art may conjure emotions that ready people for actions. In this respect, art is a tool, just like language or hammer. It mediates future social actions. Thus, arts are not just artifacts irrelevant to our reality. It is the embodiment of our reality.

I highly recommend this book to anyone who wants to get acquainted to an Activity Theory perspective of the art.