Online currencies


While I interned in Shanghai, I did a lot of research on how mathematics (specifically graph theory) could be used in things like recommendation engines. A recommendation engine is simply some sort of addition to a social network which ‘recommends’ people, products or anything really. An example we’ve all seen is one in Facebook, the ‘recommended friends’.
I came across the following article The Bank of Facebook. It sounds a rather far fetched concept at first, but something I’ve often thought about is how we could attach weight or tangible value to social contacts. Money facilitates transactions, yet I’m suspicious of people who put a lot of emphasis on generating money. It doesn’t buy happiness, but it is the only form of capital that we as human beings have gotten used to. Social capital or cultural capital are more subjective things.
There are some rather scary things that people can infer from our habits on facebook, or our spending habits.
‘By analyzing even slices of this data, a wealth of information can be extracted and predicted about you. As a related example, Google vice-president Marissa Meyer was said to have claimed at this year’s SXSW festival that credit card companies can look at spending habits and predict with 98% accuracy, two years in advance, when a couple is going to divorce. Interesting. I wonder what Facebook is able to predict, and how that information can be served up to advertisers.’

This is a spectacular comment. Some of this scares me, it is concerning that people can predict these things. We like to believe though that we as human beings are better than statistics, we have in some cases what David Foster Wallace termed ‘idolatry of uniqueness’. Yet as I realized when looking at the mathematics of online dating websites, some things are tremendous indicators. Things like university education, shared interests, religion, all these things can make or break a relationship. In our age of libertarian beliefs, we like to believe that we are the best at making decisions. Yet I sometimes wonder if we are that good at predicting who we will have strong stable relationships with.
The article is fascinating I’m still thinking about the future of online currencies. I do predict that we will have to think in other terms than just money in the future. Perhaps we’ll get better at quantifying what exactly it means to be ‘well-connected’, or ‘of good reputation’.
I often wonder about why companies sometimes act unethically. Perhaps the truth is that there are no restrictions on them acting like that. If there is no price for instance on polluting the environment then organizations will take advantage of this.
Corporations will respond when they discover that there are consequences for their actions. Especially as we face the ongoing problem of Climate Change. We shouldn’t underestimate the social constructs that are necessary for human beings to change behavior. For instance in my area of Northern Ireland there was a culture of ‘drinking and driving’. It sounds irrational, but when ‘everyone in the country was doing it’ human beings sometimes behave in silly ways. It wasn’t just the law changing, it was also peer pressure which caused mass behavior change.
I’d love to hear more views on this.