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Building a New Economy: Data, AI, and Web3

By Alex Pentland

Communications of the ACM, Vol. 65 No. 12, Pages 27-29

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During the last 30 years, digital data and artificial intelligence (AI) to exploit that data have emerged as central to management of our society. At the same time, the development of digital networks and big computing centers has promoted centralization of data and digital systems, leaving individuals and communities outside of this new digital ecosystem and without the ability to control local finance, health, or governance systems. New distributed technologies, loosely described as Web3 and employing technologies such as federated AI, blockchain, Internet of Things (IoT), and others, have the potential to give back control of data, AI, and its benefits to individuals and communities. In addition to the many private efforts now being launched, some national governments are aggressively pursuing this new suite of technologies, but with much stronger government oversight. Consequently, there is an urgent need to develop standards that guarantee a Web3 economy that remains truly distributed and yet provides global interoperability along with adequate protection for individuals and communities.

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Power Grab

During the last decade, all segments of society have become increasingly alarmed by the amount of data, and resulting power, held by a small number of actors. But this concentration of data and control is not as new as people may think: from the 1980s onward, the first wave of digital technology made it cheaper and easier to manage diverse communities from a central database using centralized administration. The resulting concentration of information and financial capital led to more than half of the U.S.'s community financial institutions disappearing over the next decades, as did local hospitals, and neighborhood-level governments. Services became cheaper and more uniform, but communities lost their local institutions and the skills, engagement, and local knowledge that go with them. With the loss of community control came the loss of citizen trust and engagement as well as the ability to tailor solutions to individual communities.


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