Bitcoin founder Satoshi Nakamoto identified

News from Pimlico is that Satoshi Nakamoto has been identified by writer, libertarian and comedian Dominic Frisby, although suspiciously you must buy his book to find out who it is.

The big news item was that Frisby reckons he has cracked the identity of the founding genius of Bitcoin, a mysterious figure who is currently only known by a Japanese alias. Who is he? Read my Bitcoin book, said Frisby. This will be available some time around late spring or early summer, and I will keep Samizdata posted.

The dwindling cost of transportation

Compared to the arrangements it replaced, [shipping] containerisation has damn near abolished the cost of transporting stuff by sea, which means that the economic significance of mere geographical proximity has now been, if not abolished, at least radically diminished. Regional trading blocks like EUrope now look like relics from that bygone age when it would take a week to unload a ship

Brian Micklethwait

From personal interest I can tell you that distance does still matter. If you, for example, manufacture something relatively perishable (e.g. 3 months shelf life) in China and ship it then you could save thousands in labour costs. The problem is the month spent waiting for the ship can seriously disrupt your sales process. And sure, you can unload a ship quickly, but those containers need to be sorted through and items re-united with their owners or their agents to be taken to the point of utilisation, which all takes time and money.

Delays like this mean it may be more affordable to pay for someone in the UK to produce your items, especially if your batch is small or product perishable. Of course, anything less perishable or higher margin and you’re onto a winner.

trans-asian-raliway-networkThey are not known for small batches, but HP have started shipping computers overland by train from eastern China to Germany. Getting the containers through the various borders and changes of gauge is a project in itself however they can shave off ten days compared to shipping, according to an episode of CNNs The Gateway . What the program didn’t cover is the fact that the destination in Germany was also well connected by sea. It would be nice to see that route fully commercialised, new tracks with standardised gauges, and a steady flow of traffic down the old silk road. Those ten days and potentially (even) easier loading and unloading times will help smaller manufacturers. There is a painfully slow UN process trying to do that politically as part of a big graniose scheme.

nepal-water-mill-mountain-stream-crppedAlso via The Gateway I found a much more modest scheme, though not short of vision, which is exporing the use of autonomous helicopters (drones) for the delivery of goods via a network of base stations. An “airborne internet of things”. The slideshow seemed to depict Africa as a deployment environement and mentioned that the scheme woukld allow them to leapfrog the building of roads in the way mobiles allowed them to leapfrog laying telephone cables. My immediate thought was that a mountainous environement would be a better use case. There are equally few roads, but more rich mountaineers would use the service for medicine and luxuries. Also you have ample water power available, which mountain some cultures already use. This might be cheaper to install and potentially better than expensive photovoltaics.

I’m happy to notice they are talking about using it for grocery deliveries in New Zealand. Happy days.

Project Meshnet

A couple of clicks away from Ven Portman’s call to arms, posted yesterday, is Project Meshnet. When I suggested we needed to help each other learn about distributed computing, this is the kind of thing I had in mind. I like how this video is produced, and I like what it’s selling:

One gripe though. The video explains it’s distributed architecture by making an analogy to a room full of people, mysteriously unable to move, but just close enough to be able to pass notes around. Well, what is wrong with these people? Did a crazy man nail their feet to the floor? Are we living in a horror movie? Real people move, they move all the time. They move on buses, in cars, on trains and in ships and on aeroplanes. In vehicles with built in power sources. If you are sat still, chances are you are not too far from someone who isn’t. People’s stuff moves all the time too, with ever greater efficiency.

My computer internals lecturer, on a tangent about networks, said “never underestimate the bandwidth of a truck full of tapes” if you can tolerate the lag, a truck full of tapes has immense bandwidth. I say “never underestimate the bandwidth of a 747 full of iPhones” and I’ve often wondered, from the perspective of a geek that never got into electronics, why a mesh style network needs to assume stationary nodes and treat moving ones as an error condition to be fixed. Surely a moving node, one able to exchange data wirelessly as it passes by other nodes, is a source of bit transport more potent, and harder to nail down, than cables.

Unfiltered : the missing liberal voice from the right

It goes without saying that I have many issues with the new proposals for default-on web content filtering. As many of you will have read, the proposals mean that network level filters for fixed-line broadband will be turned on until an active request is made to remove the filtering. There are so many things that could go wrong with the government requiring filtering for both legal and illegal content and I won’t go into the details here as many of you will know and believe the arguments. But what this, the latest media and political circus, shows is that a classical liberal argument on these and similar issues is still very much needed.

© kyz

© kyz

UK mobile phone providers already have default-on filtering with some success and some notable failures. Either way, in this current debate a conflation of issues is taking place to confuse, among others, the general public. First, child abuse images will be policed. This is something that has been and is already taking place. Reporting, blocking and removing these images should happen as a matter of criminal law. Second, filtering of legal pornography will be the default. This is, of course, outrageous in a free and democratic society, never mind the technically impossibility. And finally, child protection online is getting thrown into the mix because apparently the government knows better than all parents.

But the conflation of these arguments are politically pragmatic. It is clear that winning the votes of women and families will be of the utmost importance at the next election for Cameron and his tories to win a clear majority. Additionally, the lead MP on this issue, Claire Perry, is ambitious and a bit bloody minded. This is public choice theory in action – a political agenda created by those who are captured with greater interests.

The importance of the individual to make their own autonomous decisions for themselves and their family has been all but lost in this debate. So called “negative freedom” – the essential freedom of action that is the motor of society, has been sidelined in the news headlines.

A classical liberal voice on this issue would make all the current arguments, shared with much of the left, and then some. Our perspective is the only one which which can clearly articulate some arguments, including the absolute importance of autonomy in a free society. It continues to be a much needed narrative.

An argument lost

Letter from Sir Charles Macara

Letter from Sir Charles Macara

I found this 1913 article about Sir Charles Macara serendipitously when looking for the nearby article about the “suicide” of Emily Davison via Samizdata. It was on the same page of the original Times paper.

We know that the “employers” lost the initial argument over National Insurance and organised themselves after the event to fight for reform. They formed a Council and later an Association, and lobbied Parliament for reform to “the present measure”. That measure – the NI jobs tax – persists to this day, with the added problem of nationalised welfare provision.

For me this episode shows that companies have never enjoyed the strong position in the media they are sometimes thought to command. Okay, the Institute of Directors gets it’s fair share of quotes in the press but the debate seems to always go against big business. Enterprises need to watch for threats in arising from public opinion and watch what opinions are being fermented and spread by activist media. Forewarned, they should be able to organise in advance and may have a better chance.

This example from the Financial Times (discussed on the Silicon Roundabout blog) shows one future threat; the backlash against BigTech has only just started.


Time to go distributed

This article on TechCrunch, describes the centralisation of computing and data into silos like Facebook, Twitter, GMail etc, and shows how these developments were enablers of PRISM. The article calls for a new Prometheus to bring us the technology to stop this happening, to render centralisation unnecessary. I emplore any computer programmer to please go and read this article, it provides a clear explaination of why every computing professional should care about the design principles of distributed software design.

How did all that data get into the silos? The answer is through “web services”, which is a generic term for ways for machines to communicate. A machine here is an app, or a partnered web site. “Web 1.0” was about enabling data to flow out unimpeded to users. The era of “Web 2.0”, now drawing to a close, was about data flowing into applications from a wide variety of other stakeholders, especially users. The W3C and OASIS – two trade associations – were working on ways to make web services wonderful by applying the best academic literature to the problem. The arcane scripts of SOAP and XML Schema were applied to every protocol feature leading to an unintelligable soup of angle bracketed obscurity. These standards are fine for the people that understand them but represent a barier to the bulk of self-taught hackers that produce most web applications. For web services to get off the ground, the academic engineering approach evangelised by these two bodies needed to be superceded with another set of engineering guidelines without the arcane schemata. Some guidance was needed, SOAP was guidance, but that didn’t mean SOAP was getting done in large sections of the market.

Roy Fielding’s REST dissertation in 2000 made Web 2.0 a proper computing phenomenon, giving companies a way to build useable APIs cheaply, and flexibly. In truth Fielding merely enumerated the principles that made Web 1.0 work, but by doing so he articulated a software design style that destroyed the cost burdens of web services adoption. Simplicity won and the figures are pretty stark. In 2008 use of SOAP as compared to REST plummeted as a share of open APIs (the kind you can just rock up and use, as if hiring a power saw). In 2008 figures they plummeted again. Yet this was not people reengineering SOAP APIs into REST APIs, but was part of an exposive growth in APIs, mostly new REST APIs starting from about 2005. Important examples were EBay, Amazon, YouTube and Facebook, who did enough to prove this was a way to make money.

The explosion in new APIs for hobbyists and small businesses was important but the fact that this kind of technology had transitioned into an open market at all, with product catalogues and fixed prices was a fundamental economic change. It was to the economy as a whole what digital photography was to taking pictures. Before REST integrating with a digital partner was a year long project costing milions; afterwards the cost to dropped from millions to thousands, or just hundreds of pounds. The cost to invoke the partnership and process any given transaction is now measured in fractions of a cent, and it is now normal for API transactions to be given away for the first few thousand transactions.

With costs evaporating APIs blossomed, particulaly for social platforms (Twitter, Facebook) and productivity tools (Skype, Dropbox) and content flowed into these platforms from eco-systems teeming with little start-ups, hobbyists, and app developers. The obscure engineering principles of REST made social media happen, it gave Apple’s AppStore something to sell and what it sold was apps that put data in the Cloud – into silos. All the NSA has to do, is go to the silo operator and demand access. We put the data into harms way through REST, of our own accord, becuase REST made it easy to do that.

What if REST was not a client-server protocol – a protocol for end-user to shove data in silos – but a way to find a home for data that was private and secure? A means to put data in a lockbox safely? Well, it isn’t. We can only dream of a world in which everything we have now is available free of snooping and interference, instead it is simply available free of charge.

But it isn’t too late. There are tools and protocols in the distributed systems space. BitCoin, BitTorrent and TOR lead the way and provide inspration, but there isn’t, to my knowledge a vibrant commercial eco-system of development a common distributed infrastrusture. The problem is, I think, that the one thing that SOAP and REST had in common, the thing that made them both viable is missing from the distributed space – HTTP. HTTP allowed for URLs – easy ways to find the thing you wanted on the Internet, and for common operations – read, create, update and delete – to be performed easily on those things. SOAP and REST simple provided guidance about how to use HTTP to do more concrete things, like create an airline ticket etc. I have been doing REST style things for years, and can speak HTTP unaided, but I haven’t even heard of equivalent tools and frameworks for creating, updating, deleting and fetching things in a distributed manner, or indeed anything as univerally useful.

Recently, Adriana Lukas shared some ideas at the Rose and Crown that move us part of the way there. She articulated the equivalent of the law of gravity, or of thermodynamics, upon which engineering practices of every kind rely. This is a step in the right direction, but libertarian programmers need to help each other to identify or build the rest of the picture, to help us fil our iPhones with this new kind of App. To get data out of harms way we need an explosion of the kind Roy Feilding enabled with REST, but in services of a kind that keep us safe and free.




Video: Hacking at Hierarchy

Adriana’s talk offered less in the way of practical solutions than I might have liked and less perhaps than the write-up promised, but this did not diminish a fascinating talk by someone clearly absorbed in her topic.

The following write up is based, in order of importance, on her notes which were quite thorough and provide the bulk of words, my own thoughts and recollection, and from watching the video in the process of editing it. I could have simply posted Adriana’s notes, but wanted to provide a flowing readable narrative.

Adriana is fascinated by Networks – especially a particular kind, called “distributed networks”, which are special. Distributed networks have no centre that controls them. This puts them at odds with a common and mistaken mental model of networks as a kind of bicycle wheel with each node reporting to a centre. This is a mental model that gets in the way.

Rather than offering practical help, Adriana set out to point her audience in an interesting direction. Perhaps a little like Newton did when he described gravity. First, she noted that the Internet – a successful distributed network – offers a hint about the truth of organisations and social structures. This hint is much more obvious in distributed networks.

Who is Adriana?

Adriana was (is?) as well paid consultant specialising in disrupting companies. It sounds odd that people would value being disrupted, but her role consisted of going in, finding the talent and forming a new structure to get something done outside of heavyweight processes and conventional structures. Adriana discovered that underneath all the “flat departments” and “theory Y” management corporations and businesses are ultimately hierarchical organisations, and very good ones. Processes and rules she said do not empower nodes (employees) but rather act as an efficient implementation of authority.

She set out to discover if there are alternatives to hierarchies.

What is a hierarchy?

There are many ways of defining a hierarchy. Examples include the traditional family, monarchy, democracy, church, army, corporation etc, which are complex but the fundamentals still apply authority.

The mathematical fundamental – derived from graph theory – is a network with no peer connections. Whatever the node is (person, computer, device) each node is connected only to a node above and below. A node above another, by definition, is superior and possesses authority to command the lower inferior nodes.

In a corporate environment, this may not directly match your experience. Things may indeed get done without direct recourse to a manager. Does this observation falsify Adriana’s theory? No. Adriana pointed out, quite reasonably, that processes (I imaged examples like “Agile”, or “Petty Cash”) replace the need to constantly seek permission each time from superior nodes. This delegation or proxy for authority also allows a hierarchical organisation to function day-to-day in a reasonably efficient way.

Relative to the individual

Another way of defining a hierarchy, Adriana observed, is that in a hierarchy the individual is always subjected to the system. It does this by offering a faustian bargain. We think “collectives have benefits, surely?!” but in fact hierarchies don’t empower individuals, they confer power on individuals within the system but not autonomy. Neither a king or CEO are autonomous, but are dependent on the system that grants them power. The system’s grant of power (providing legitimacy) and the utility of directing other nodes (providing labour) are together essential to the leader.

Adriana went as far as to venture that, because of the above, any organisation is a hierarchy, and she says this is something she would like to justify through further research. She then drew on direct experience to point out that revolutions merely lead to other types of hierarchy, with different individuals and different processes.

Are hierarchies “hardwired”?

It sometimes seems as if hierarchies are pervasive and natural, that the evolution of a an order – however spontaneous or flat or whatever – was ultimately a hierarchy. Adriana used the talk itself and the meetup as an example of a hierarchy that had spontaneously errupted. This leads to me to mention my only objection to her talk which is that all the petty hierarchies (the non-state hierarchies) are accountable to an ultimate over-arching non-hierarchical structure – the market – and so the spontaneous order of one person facilitating a regular meetup does not feel like a hierarchical enterprise and certainly not like a problem. Ultimately, it’s me and my customers.

The point of mentioning this was, it seems, to demonstrate that hierarchies may indeed be hard wired into us. Adriana was giving the status quo its due credit, suggesting that the spontaneous way they can emerge and their prevalence is evidence that they are unavoidable.

Adriana proposed that it is possible to tweak hierarchies and that not all hierarchies are equal.We can observe that some are more or less desirable “in some respects”. Democracy is better than slavery or monarchy, for example.

She also shared an example from her quantified self meetups, where she tries to avoid placing people in a theatre or auditoriam style seating layout (speaker at the front, with rows of seats facing the front). She says that you never get a natural discussion happening in that layout, but that you might if you arrange seating in a circle.

Another situation in which hierarchies fail to blossom is on the internet. It’s ability to route around obstacles gives it connectivity, it’s lack of centre gives it resilience. I don’t think Adriana mentioned it specifically but I often think of this as an open network of “ends”, where all ends have equal connectivity, anyway, I think most of us know what the Internet is and know that it is really very much not a borign stifling hierarchy.

The existence of these examples shows, Adriana argued, that there may be an alternative set of structural norms that can work non-hierarchically. If we can work out what’s common to these examples then you can present an alternative and this is what Adriana did. She calls it a heterarchy:


n. – a network where each node is or can be connected with another, without central coordination.

The Five Laws of Heterarchy

These are the factors that describe what was special about the Internet and the other examples of social phenomena that work without hierarchies.

Adriana’s notes are very thorough in her laws, though they are what they are which is a statement of current research which is very much “in progress”. I will quote them directly:

1. Collapse of Function and Balanced Asymmetry

Collapse of functions at the individual node level, which says that for a heterarchy to exist and persist, each node has to be able to perform certain functions. It means there are no hardwired distinctions of role and functionality among the nodes.

In terms of three technologies and one online phenomenon that I found share the same heterarchical characteristic. TCP/IP itself, BitTorrent, public key cryptography and the blogosphere.

TCP/IP turns any server into an originator, relaying party or recipient of a message. The relationship between nodes is not symmetrical but each server can at any time perform any of the roles.

BITTORRENT is another technology native to the network. It was born out of scarcity of bandwidth but it uses the distributed peer-to-peer nature of the internet to share files among nodes. In short, once a user starts downloading a file, he/she is automatically uploading too.

PUBLIC KEY cryptography was conceived for communicating in a distributed network. The traditional symmetrical keys approach couldn’t solve the problem of how to communicate with someone you trust in an untrustworthy environment.

For the purposes of this example, public key cryptography also exhibits ‘asymmetrical balance’ where the recipient of the message is part of encryption. So Alice uses Bob’s public key to encrypt her message for Bob, thus making him part of the process. Again, this was necessary in order to solve a problem that arose from new type of environment – i.e. distributed network, a heterarchy.

2. Freedom/Ability to bypass nodes

This law is not dissimilar to what John Gilmore said about Internet censorship: “The Net interprets censorship as damage and routes around it. It is the freedom and ability to bypass an obstacle.

A very important law, it ‘dissolves’ any attempts at hierarchy as it makes it impossible to lock-in the nodes and the flow of information or resources into a particular situation or formation without their cooperation.

3. Decentralised and Distributable Resources

It is the difference between having to go to the post office to make a phone call and the ability to make a call at home, difference between making a call from home on a landline and being able to make it anywhere using a mobile phone. Another example, having to go to specialist shop to have things printed or copied and being able to print it at home from your own printer.

Both previous examples were taken from communication or information distribution but when we start looking at 3D printers, things get really interesting. This law is important as having to use a centralised resource, apart from restricting nodes’ autonomy, opens up opportunities for control of that resource and imposition of a hierarchy.

4. Abundance

… of resources or at least sufficiency of the most important resource that enables us to create and maintain the network. For internet its connectivity and bandwidth.

In other words, don’t try to build a heterarchy around a scarce resource as once that is controlled, heterarchy disintegrates. An example of an abundant resource would be information online, as digital format makes information [easy to duplicate] and therefore abundant.

5. Low marginal cost of communications

This is important because in a distributed peer-to-peer network it takes a lot more information exchanges to negotiate transactions. Think of trying to arrange a lunch meeting with a friend – agreeing on a day, then the venue, then timing, going back and forth because you are negotiating as peers, not top down… This of course, requires some information infrastructure with zero or low-cost communication.

[After] 20+ years of the internet – very few network native technologies based on its distributed nature. TCP/IP itself, BitTorrent, public key cryptography. There are more, BitCoin, TOR etc but only in niches.

And we are imposing hierarchies even there. Think of content filtering, large platforms like Facebook etc that mediate our access to other nodes.

Let’s put them to work

With explicit understanding of heterarchy, there is potential to build systems and technology truly ‘native’ to the internet as a distributed network. Which would be more robust, powerful and also disruptive. Just think of how much (positive) impact TCP/IP, public key cryptography and BitTorrent have already had.

There is a potential to find better models for operating in networks and in virtual environments. And finally, there is potential to come up with alternatives to our hierarchical organisational defaults. That would be a great news for all those trapped in stifling and disempowering organisations.

Common objections

Adriana dealth with a number of common objections to her theory about the superiority of heterarchy and to her implication that heterarchy is a better political order and organisational order. Again here notes here were thorough, so I will quote directly:


Hierarchy is the most common organisational model, people assume any order is by definition a hierarchy. Even if they recognise flaws of hierarchy they are equally worried about the lack of hierarchy leading to chaos.

OTHER TYPES OF ORDER, for example, ranking or POWER LAW.

Power law distributions tend to arise in social systems where many people express their preferences among many options. They became a popular concept during the rise of blogging when some blogs achieved ‘disproportionately’ greater popularity than others. Another example would be ranking twitter users by the number of followers or retweets or replies – there are people with more of each but that wouldn’t make such order a hierarchy (remember definition of hierarchy)

The important difference here is that while the popularity of blogs, for example, might follow a steep power law distribution, that popularity only offers an incentive to deal with that blog. Popularity does not confer power over less well-trafficked blogs, or prevent their autonomy.


“if you give individuals independence and autonomy, wouldn’t it all disintegrate into selfishness or even atomism?” On the contrary, hierarchies are far better configured for selfish people, they allow them to gain control over others, manipulate them for their purposes. And as for atomism, aren’t we supposed to be social animals?



Adriana had heared it claimed that “people need security and certainties that hierarchies provide” but argued that other people do not need such security and argued that it is equally valid to optimise for those people instead.


Adriana also dealt with the objection that societies and institutions have evolved as hierarchies for social, political reasons. This is arbitrary and there is no reason we should not continue to evolve them in new ways.


The last objection implicitly argues that we are hardwired and for a good reason. The claim was “human evolution favoured hierarchies because they optimised survival and efficient distribution of resources”. But the economy we enjoy today has moved beyond a state of scarcity and now there is an abundance of most day to day resources for most Western people. The need for this optimisation is gone.


The very fact that there are structural reasons for hierarchy and stories to be told about how to encourage heterarchical behaviours and examples of vibrant heterarchical systems is encouraging. Explicit knowledge of some of the underlying causes of that success can lead to efforts to build organisations and systems that exploit and encourage heterarchy.

…this means hierarchies may not be inevitable and we don’t have to resign ourselves to hardwiring them in our minds