{"id":8975,"date":"2022-03-03T19:48:11","date_gmt":"2022-03-03T19:48:11","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/how-behavioral-tokenomics-could-facilitate-the-creation-of-a-circular-economy\/"},"modified":"2022-03-03T19:48:13","modified_gmt":"2022-03-03T19:48:13","slug":"how-behavioral-tokenomics-could-facilitate-the-creation-of-a-circular-economy","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/how-behavioral-tokenomics-could-facilitate-the-creation-of-a-circular-economy\/","title":{"rendered":"How behavioral tokenomics could facilitate the creation of a circular economy"},"content":{"rendered":"
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The Iota Foundation and Imperial College London recently announced the launch of a four-year distributed ledger technology, or DLT, initiative\u00a0designed to research and develop solutions to foster socially conscious, circular economic models and businesses around servitization.<\/p>\n

The Imperial-Iota-Infrastructures Lab, known as the I3-Lab, will operate within the Dyson School of Design Engineering and has adopted the tagline \u201cinfrastructure powered by Iota; analytics powered by Imperial; use-cases powered by the community; and impact powered by partnerships.\u201d<\/p>\n

Expected to commence this summer, the I3-Lab has been initially funded by a $1 million philanthropic grant from the Iota Foundation and will soon become a co-funded project following an\u00a0undisclosed contribution from ICL described as \u201csubstantial.\u201d<\/p>\n

Two post-doctoral researchers and five Ph.D. students, overseen by project leaders, will focus their efforts on five projects spanning an array of proposed subjects including tire emissions in the mobility space, ethical batteries in the energy industry, and an infrastructure project to develop the underlying technologies around digital twin and DLT, in addition to two open calls with the aspiration to engage the broader ICL community and attain internal funding.<\/p>\n

The lab, which is currently under construction, is approximately the size, if not a fraction larger, than a soccer field goal area \u2014 also known as the \u201csix-yard box.\u201d <\/strong>Architectural plans reveal intentions to construct a second-story mezzanine overlooking the ground floor, so as to provide ample space for the seven students and their necessary equipment.<\/p>\n

Cointelegraph\u2019s Tom Farren visited Imperial College London and spoke to Robert Shorten, deputy director of the Dyson School Engineering Design; Peter Cheung, head of the Dyson School of Design Engineering; and Navin Ramachandran, a member of the board of directors at Iota, about a wide range of topics, from tire emissions and the Jevons paradox to tokenomic incentivize models, Iota\u2019s proposed governance ambitions and the behavioral impact of coins in shopping carts.<\/p>\n

This interview has been condensed and edited for greater clarity.<\/em><\/p>\n

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GM from @imperialcollege<\/a> @ImperialDyson<\/a> @iota<\/a> <\/p>\n

Interview time! \u270d pic.twitter.com\/Fk8FxXWF02<\/a><\/p>\n

\u2014 Tom Farren \u262e\ufe0f (@tomfarrencrypto) February 16, 2022<\/a><\/p><\/blockquote>\n

Cointelegraph: What were the specific reasons for partnering with Iota on this project?<\/strong><\/p>\n

Peter Cheung:<\/strong>\u00a0The reason why we\u2019re so interested in Iota with the I3-Lab is because they are aligned with our values. It is a technology-driven area, but our department has the mission to make a difference in society and humanity. And this is a technology that we believe will have a significant impact in the future, and therefore, we want to invest in it.<\/p>\n

Robert Shorten:<\/strong> \u201cTraditionally, blockchain-type technologies have been used in fintech as a means of payment, or for tracking goods and services. We\u2019re really interested in exploring the behavioral intervention side.<\/p>\n

A big issue in the sharing economy is the idea of being able to manage risk. The risk of someone not doing what they said they were going to do. For example, if you\u2019re in a shared vehicle, it should be returned at a certain time, and if someone doesn\u2019t do that, then it undermines the whole sharing concept.<\/p>\n

\u201cThe idea of managing the risk of misusing of an asset, rather than managing the access to the asset, is very subtle thing but actually a really important part of the sharing economy in these new models of ownership.\u201d<\/p><\/blockquote>\n

CT:\u00a0<\/strong>How do you envision the way Iota\u2019s feeless structure could support these new models of ownership?<\/strong><\/p>\n

Navin Ramachandran:<\/strong>\u00a0When you\u2019re working in a feeless environment, how do you do it with fair distribution? The issue we\u2019ve had, and a lot of projects have had, is that things make sense from a research perspective, but when implemented, the algorithms are so complex that they break very easily or the processing takes too long and it becomes very heavy.<\/p>\n

PC:<\/strong>\u00a0Or it may not be scalable, so when you double or 10x the users, it breaks. Scalability is one of the most important factors, and one of the weaknesses of blockchain technology.<\/p>\n

RS:<\/strong>\u00a0The feeless aspect is something that attracted me to Iota because I\u2019ve spent years working in congestion control. And actually, I thought I\u2019d left it behind me before I met these guys! One of the things that I\u2019m interested in, and that attracted me to Iota, is designing cyber-physical systems.<\/p>\n

It\u2019s kind of a goofy example, but one of the great successes in humans interacting with technology is the coin in a shopping trolley. I remember when I was growing up in Ireland, there used to be shopping trolleys in every river. [To the room: I don\u2019t know whether you remember that?]<\/p>\n

NR:<\/strong>\u00a0Now it\u2019s electric scooters!<\/p>\n

RS:<\/strong>\u00a0Then, someone had this great idea of putting a one-pound coin in the shopping trolley that you get back when you return it. You can create digital forms of that idea with Iota because of the feeless structure. But you can\u2019t do that easily with other blockchains because every time you put down a deposit, a piece of your coin gets taken away as a transaction fee.<\/p>\n

We\u2019ve been using that sort of idea to do lots of work with electric vehicles, and in other areas to repurpose and reuse in the pursuit of circularity.<\/p>\n

Ramachandran\u00a0raised the point that phrases denoting the encouragement of artificial behavior change, such as nudging or incentivizing, can often be deemed to have negative, somewhat authoritarian connotations. But it was noted that it is important to distinguish\u00a0what\u2019s best for the collective and follow that with good intentions.<\/em><\/p>\n

Shorten\u00a0then continued\u00a0on:<\/em><\/p>\n

\u201cThe DLT part of that story is really interesting because it talks about digital identity, ownership and new ways of nudging people using tokens. It talks about new ways of assigning responsibility for individuals\u2019 actions and personalized types of interventions. That\u2019s all part of DLT\u2019s story. And it\u2019s all potentially very good, as well as being potentially bad.\u201d<\/p><\/blockquote>\n

CT: In our initial conversation, you [Shorten] stated that the higher torque and weight of electric vehicles leads to greater road friction and often results in particles entering the waterways or human respiratory system to cause potentially wide-ranging health concerns. How will the I3-Lab explore this area within the mobility project?<\/strong><\/p>\n

RS:<\/strong> Tires are probably going to be a big theme at the college, ranging all the way from understanding the tire abrasion process, particle size distribution, and the potential impact on humans and the environment, to the behavioral side and how we can develop new types of systems and ways to interact with mobility to minimize the impact of tire waste.<\/p>\n

A group of esteemed students known as The Tyre Collective from the\u00a0Dyson School of Design Engineering\u00a0side of ICL were\u00a0awarded\u00a0second prize for the international James Dyson Award and first prize in the United Kingdom for their acclaimed invention of a mechanism designed to attach onto the frame of tires and capture microplastics at the point of wear. This YouTube video illustrates the process in greater detail.<\/em><\/p>\n

Shorten, who is well educated on the evolutionary timeline of electric vehicles over the past half a century \u2014 and specifically, their reciprocal\u00a0impact on environmental progress \u2014 cited the Jevons paradox, a 19th-century observation on the impact of coal consumption following the invention and widespread adoption of the Watt steam engine.<\/em><\/p>\n

A visual portrayal of the paradox reveals that when the elastic demand of an environmentally centric product contributes to the increase of total supply, the aggregate value of energy consumption can increase. Quite simply, if the demand for electric vehicles rises considerably, there will be more cars on the road and, thus, higher emissions.<\/em><\/p>\n

<\/figure>\n

In our initial discussion, Shorten quaintly illustrated a disheartening societal truth that due to geographical and circumstantial challenges \u2014 on occasion enhanced by societal imbalances \u2014 \u201cPeople often make poor choices for really good reasons.\u201d Relaying that statement in person, he elaborated, stating:<\/em><\/p>\n

RS:<\/strong>\u00a0That\u2019s right. They can\u2019t afford to make the choices that society wants them to make. And you can\u2019t blame them, right? How could they possibly do that? So, trying to remove the up-front cost, I think, is a really important part of giving people access to good choices.<\/p>\n

CT:\u00a0<\/strong>Do you feel that our society is progressing toward a more servitized, renting economy in light of the emergence of companies such as Airbnb and Uber?<\/strong><\/p>\n

RS:<\/strong>\u00a0I think we are, and I think we have to. There\u2019s great opportunity to be much more efficient and responsible in the way we consume, but there\u2019s also an opportunity for people to misuse that.<\/p>\n

NR:<\/strong>\u00a0I think the younger generations are probably more used to these subscription models, whereas I think the older generations are much more used to owning stuff. But who knows what\u2019s right?<\/p>\n

RS:<\/strong>\u00a0In theory, it\u2019s a good idea, but there\u2019s a layer that we need to wrap around it to make sure it\u2019s done in a responsible way. That would be the caveat, or the qualifier.<\/p>\n

CT: Will the I3-Lab\u2019s findings be published in an open-source, transparent manner?<\/strong><\/p>\n

PC:<\/strong>\u00a0All our work is going to be open source.<\/p>\n

NR:<\/strong>\u00a0Everything has to be open source. And even in research, if you want it to be reproducible, you have to have open datasets. We don\u2019t want to make anything proprietary.<\/p>\n

PC:<\/strong>\u00a0That\u2019s partly why Iota\u2019s grant can be seen as a grant, not a research contract, because they will open everything.<\/p>\n

NR:<\/strong>\u00a0After Chrysalis and StarDust, we\u2019re going to be moving to an open governance model. There are going to be Ethereum Improvement Proposals, Bitcoin Improvement Proposals and Iota tips.<\/p>\n

Every idea will get proposed in the open where people can comment and revise it before it gets implemented. That\u2019s the way it should be going forward.<\/p>\n

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Everything we do will be freely accessible and open source. We also invite our dear #community<\/a> to participate in the Lab (more to follow on that). <\/p>\n

This will be the first of many philanthropic activities from the #IOTA<\/a> Foundation. <\/p>\n

Lets accelerate our impact, together.<\/p>\n

\u2014 Dominik Schiener (@DomSchiener) February 3, 2022<\/a><\/p><\/blockquote>\n

CT:\u00a0<\/strong>What\u2019s your stance on technological patents in general business practice, and specifically for the I3-Lab? Do you believe that a walled-garden, protection-first approach is sometimes required in these hypercompetitive industries?<\/strong><\/p>\n

PC:<\/strong>\u00a0For this project, I believe that we might patent, not because we want to profit but because we might want to prevent other people from profiting and violating our principles.<\/p>\n

NR:<\/strong>\u00a0I separate two things: one is the core layer of the technology, which I think has to be open source; and then second, companies building proprietary things on top of that. If it impacts everyone and it\u2019s core technology, then it should be open because anyone controlling that controls the direction of the network.<\/p>\n

PC:<\/strong>\u00a0We are not objecting to patenting because companies need to survive, be economically viable and make a profit.<\/p>\n

Shorten\u00a0showcased a physical example of a previously patented product from Imperial College \u2014 a Lego-brick device that extends the range of\u00a0electric vehicle\u00a0charge points and, in turn, encourages a daisy-chain model in which drivers can be incentivized to uphold the network via tokenomic rewards. This is the shopping trolley idea in digital form, they state.<\/em><\/p>\n

Following\u00a0on from this,\u00a0Cheung\u00a0noted:<\/em><\/p>\n

\u201cIf you have an idea, you\u2019ve got to patent it or publish it. If you don\u2019t do either of those things, somebody else will, and you might not be able to develop your own idea. And we wouldn\u2019t want to be developing ideas for the benefit of an individual company with everyone else excluded. That would defeat the purpose of it.\u201d<\/p><\/blockquote>\n

CT: How are you planning to measure success within the project?<\/strong><\/p>\n

RS:<\/strong>\u00a0We\u2019re going to form an external board that will evaluate the progress of the lab against milestones. They\u2019ll be externally independent from Iota and Imperial and will be people who will give a really honest opinion. That\u2019s the only way you can measure success.<\/p>\n

CT: <\/strong>What are your precedents for these milestones? Have quantitative targets been established as markers of success?<\/strong><\/p>\n

RS:<\/strong>\u00a0It could be new sustainable businesses that we stimulate, it could be engagement with policymakers. There are also all the usual things, like the number of patents and number of papers. A big metric would be how successful we are in leveraging the center to generate more income to build use cases in partnership with companies, as well as getting some of the ideas that we foster at the lab into industrial products.<\/p>\n<\/div>\n