True or false? That's the big question in 2023. With generative AIs (ChatGPT, MidJourney, Stable Diffusion...) now dominating content creation and everything seeming 'more real than reality,' it's becoming harder to know who to trust. The decentralized technologies of Web3 (peer-to-peer networks, Blockchains) aim to improve traceability and verify the sources of information to confirm its truthfulness. It's an admirable goal, but the outcomes are still controversial.
In our 'centralized' world, authority figures, represented by institutions and organizations, are seen as trusted references. These authority figures are necessary to correct information asymmetry in the market. In particular, reference media in the democratic ecosystem of Western societies can be seen as authorities offering near 'certified' information. Indeed, the reputation of the source of information plays a crucial role in how it is perceived and accepted. If we apply this logic to finance, rating agencies also hold this influential position, as their near-monopolistic character (Moody's, S&P, and Fitch hold 85% of the market) means the information they provide becomes the industry standard.
Today, the voices of authority figures, once raised to 'oracle' status, are being seriously questioned. There's no denying that our contemporary societies are shaken by crises of confidence, sometimes called crises of 'faith': fake news, malicious generative AIs producing content that's more real than reality, loss of consumer trust leading to changed buying behaviors... Current events keep fueling a climate of general distrust and doubt, gradually undermining the institutions representing authority. This raises ongoing public debate: who is right, who is wrong, who certifies truthfulness, and on what criteria?
Detrimental to society, this distrust casts a shadow over many players who, it's fair to say, were too slow to see transparency as essential. Now, these essentials have become imperatives. The economic system isn't immune and can't function without trust. The accumulation of scandals, from the manipulation of the Libor to the recent issues with Twitter and Elon Musk, has contributed to this erosion of trust. Furthermore, every centralized structure is inherently questionable, as it is run by human beings (who are by nature corruptible and fallible) and derives its legitimacy solely from its dominant position (both historical and financial).
This is where the 'decentralized' world steps in, especially Blockchain, which is the most developed attempt to counter discredited institutions. It ensures that information meets the expected protocol at each validating node, meaning the information is unique, tamper-proof, and non-fungible. However, it remains our duty to maintain our judgment and question the truth of the information before incorporating it onto the Blockchain. To illustrate, we can use NFTs as an example: digital works that can be bought and traded with cryptocurrency on a Blockchain. The Blockchain becomes authoritative in validating what's recorded in the ledger: the transaction, the work's URL, the date, the amount, the owner's address. However, if there is deception about the work during integration (plagiarism of an unlisted work), the Blockchain will not be useful in restoring the truth.
Furthermore, decentralization, which is the essence of the security principles championed by public Blockchains, is now relative. Bitcoin, the historical Blockchain, is in the hands of 'mining' consortiums in China and the Nordic countries, concentrating a significant amount of computational and mining power. This re-concentration of the Bitcoin network contradicts the plurality of validating nodes necessary to ensure the system's reliability.
The same goes for Ethereum, the other famous public Blockchain, which has recently switched to the 'Proof of Stake' validation system. This system requires 'staking,' meaning owning a minimum amount of cryptocurrency tokens as a selection criterion. The process is similar to poker: the more you 'stake' with Ethers, the better your chances of validating a transaction block and thus being rewarded... in Ether. In other words, this system is akin to plutocracy, as it gives more weight and authority in validation to the wealthier, who then become even richer.
The new decentralized technologies that underpin Web3 are therefore full of promise and contradictions. Perhaps it's wise to let these technologies (whatever they may be) stay in their place and reintroduce (critical) common sense. A trust relationship is built over time. Content from a source known for professionalism and honesty earns the receiver's trust (whether or not certified by an authority). This is good news for legacy and historical brands that have developed their narrative over time around a bundle of verifiable evidence.
