Implementing Pain Tracing Blockchain into Organizations

I. Can We be Good without a Definition of Good?

Many people in society may have good intentions. Yet, protests as an outpouring of goodwill, such as demonstrations and signature drives, are not always fruitful.

Nevertheless, some believe that the protest itself is meaningful and the movement can change the reality by causing the politicians to care about it. But demanding the mental strength to continue activities without feedback, aiming at too distant goals and indirect realizations, is hard. It would be difficult to guarantee that the activities do not degenerate into a protest for protest’s sake.

It is hard for sporadic good intentions to produce results unless they are connected in some way. Although, there are histories of further tragedies (Nazism, massacres in the Soviet Union, etc.) in “revolutionary movements = organizational renewal” that centralize movements from the top.

Besides national and social organizations, we also belong to companies and local communities. The same problem of difficulty in reforming such familiar organizations also exists, though on a different scale. The first question is, what is the ideal state of an organization? Revolutionary movements in the past have been disastrous by defining dreams and hopes that are inherently unwritable as “ideals” and then ostracizing those who do not follow them in internal struggles or accusing anyone who refuses to bow to its favored interpretation as “reactionary.”

The problem is that we can only have a vague idea of what is “good.” It is difficult to define what is “good” for the community affirmatively, and when we write it down, it tends to become a skeleton. So, instead of seeking to gain something positive, what if we thought of reducing the negative? We want to consider “non-positive ideals (minimal ideals)” in a way that is different from a mere “ denial,” in which the boundary is gradually limited from the outside by stating “this is wrong” each time.

This article will define a condition that an organization should satisfy as “minimal ideals” and present the idea of “pain tokens” for a concrete mechanism toward its feasibility.

II. A Minimum Ideal for Organization, PS3

Let us assume the following four conditions as minimum ideals for the desirable state of organizations.

1: Sustainability: Efficient enough to be competitive with all existing organizational forms.

Even if an organization provides a "dream work environment" for its members (e.g., workers), its output will not be competitive if it is too inefficient or unproductive. The organization will eventually force itself into dissolution. The comparison for efficiency is with existing organizations that are producing the same product.

2: Pain minimization: Reduce the total amount of stakeholders suffering as much as possible.

Suppose an excellent efficiency is obtained. Nevertheless, if that efficiency is redeemed by the intense suffering of the organization’s community, then the organization is undesirable.

The reason for minimizing suffering and not maximizing total happiness (utility) is that in an organization with huge inequalities, even if suffering occurs, the total can be increased by some members corresponding to the “utility monster,” or only the utility of investors can be enhanced. In the past, many revolutionary activities have ignored this condition. Therefore, they forced “sacrifice for the organization (revolution).”

3: Scalability: Even if the number of members increases, other conditions can continue to be met.

It is common that a venture company with a good atmosphere starting with a small group, becomes a mere bureaucratic organization after it becomes a giant. However, since individual members' intelligence and cognitive abilities are limited, there is no way to avoid organizational growth, division of labor, and division of authority. Existing organizations often solve this problem by hierarchization.

There may be other ways, but none have been discovered yet. Also, simply decentralizing the organization will not solve the problem of cognitive ability. However, it is not clear to what extent managers and upper-level members of the hierarchy need to be rewarded with higher rewards. Hence, changing this condition may be possible.

4: Security: Less likely to be destroyed by malicious attackers

Consider a society where there are only good people. Suppose an organization is created that happens to meet all the requirements. However, if a single selfish intruder destroys it, the organizational structure is too unstable to be adopted.

Our history provides many examples of “revolutions” that temporarily create a “good system” and then break it all at once. So, not trusting all people? That will not work either. Ideally, an organization should be able to reduce the cost of security as much as possible. Of course, there is no way to know how to do this.

We call these “ideals” the PS3 condition (Pain, Scalability, Sustainability, Security) for ease of remembering. PS3 is incompatible with, for example, the position that “society values only the concentration of resources on talent and its creativity.

So it is not the ideals for everyone. However, PS3 defines the ideal of an organization only through the properties of the organization itself. In this sense, it is a “minimalist” ideal. It is possible to plugin such ideals as “freedom and equality (of members)” into PS3, but it is necessary to examine whether attached one will not destroy PS3. In this sense, PS3 is more like a “condition” than a normal “ideal.”

III: Empathy and Concern for Others in the PS3

As previously written, in the articles that follow, the conditions of pain minimization, security, scalability, and sustainability are referred to as “PS3” (Pain, Security, Scalability, Sustainability) and are assumed to be the basic requirements of governance (the minimal ideal).

PS3 is a negative goal. It is a restraint against bad organizational conditions such as bullshit jobs and does not positively depict an ideal state.

In addition, PS3 does not treat attributes that are unconditionally good, such as diversity of members, as positive in and of themselves.

For example, if “lack of diversity leads to failure to learn and over-adaptation to the environment, resulting in the organization losing its ability to cope with reality and becoming unsustainable (a violation of Sustainability) or causing increased suffering (a violation of Pain),” then we say, “That is not good.”

PS3 is similar to, but different from, a situation where the only thought is “follow the rules, and the rest is up to the individual. How is it different?

For one thing, empathy and concern for others, in a paraphrased form, are included in every item.

  • Pain minimization, as emotional or sensory empathy
  • Security, as concern for others with unfathomable intentions
  • Scalability, as the inability of institutions to be destroyed by being buried in the crowd of others
  • Sustainability, as the ability to continue to survive with others who have conflicting goals and beliefs

And so on.

PS3 is a working hypothesis postulated in thinking about the systematic possibilities of (autonomous) decentralized organizations made feasible by blockchain technology. In other words, it was hypothesized as a condition for thinking about “a way to keep the organization self-renewing without ideals or orders” in the search for the potential of a decentralized organization that does not exist in conventional centralized organizations bound from above by ideals, goals, and investments.

Minimizing suffering is useless if there is no way to track and evaluate it, and if that trust is maintained by entrusting it to a particular power, we are ultimately back to a situation where there is no higher level of the state centralization. It is very tough to convince humankind, which has gone through totalitarianism and realism, that the state is not dishonest only in tracking suffering.

However, now, with the blockchain, we can concretely imagine a way to technologically combine “traceability” (to suffering) with “decentralized trust” (without relying on centralized organizations and authorities). That is the pain token.

IV: What is Pain Token?

Philosopher Hannah Arendt called for a certain kind of courage, the kind of judgment that requires individuals to risk their lives to defy orders and maintain justice for humanity.

Courage is probably necessary. However, governance that relies too much on individual courage is not sustainable. The number of people with courage is small and unlikely to increase.

We can now create a mechanism (which was impossible in the past) to objectively tell people that we do not like something without courage.

Asaki Nishikawa, a member of VECTION, has proposed a simple system called “Pain Tokens”. It is a hypothetical right that assumes the following context.

  • It is easier to reach an agreement on pain than on happiness
  • Avoid believing that a cause (idea) or someone’s happiness naturally involves suffering
  • Make latent and invisible pain visible
  • Organizational failure can appear as a signal of pain, through which the organizational structure can change

Pain Tokens take the form of tokens (a unit of entitlement, like virtual currency) that are used in the network and operate according to the following rules:

  1. Pain Tokens are distributed to the organization’s members in fixed amounts over a fixed period of time
  2. Non-transferable
  3. Members decide how much to exercise each period
  4. Exercising is done anonymously
  5. The organization is obligated to attach to its output a traceable amount of Pain Tokens exercised in producing them

Pain Tokens are recorded in a public blockchain, and therefore cannot be tampered with, and are an anonymous, decentralized, change request authority for the organization.

Pain Tokens do not require any evaluation of the specific proposal. Moreover, it is unique in that it can anonymously express the fact that “pain” is occurring without knowing who is causing it or why it is painful.

So, how does an organization respond to the exercise of the Pain Token? For example, the following assumptions are possible.

The exercise of the Pain Token changes the organizational structure (the contribution of each member, authority, command, and the way resources to route).

The size and shape of the change are determined by a separately defined algorithm (without human intervention to prevent as much discretion as possible), taking into account the total amount of Pain Tokens exercised, the classified information of the exercised member groups, and the current organizational structure.

Pain Tokens are just a rudimentary example of a mechanism for tracing the pain signals of organizational members inside and outside the organization. However, if a similar mechanism can work successfully, it should be able to give a little more concrete substance to actions such as “Do not purchase products that are not fair.”

V: Changing the Organization through Pain Tokens (DAO + Pain Tokens)

For example, if a decentralized organization such as the DAO adopts pain tokens, we can consider the following changes in the automated organizational structure without the intervention of human will (politics).

Changing the organization through pain tokens
Changing the organization through pain tokens

N: A completely flat and decentralized network-like organization, tentatively assumed.

T=N(T): tree-like routing structure (= organization) formed by the environment and learning up to a certain point.

N(T) is a network that represents the same structure as T.

T´=N(T´): Another tree structure newly re-routed by feeding back the results of exercising the pain token.

N(T´) is a network that represents the same structure as T´.

N´: An organization with multiple inherent tree-like support structures as dynamic routing structures that can quickly switch to N(T) and N(T´).

a: The network N becomes a tree T according to the current task and situation. The necessity to make it a tree is because trees are effective in many cases in terms of division of work and speed of execution. However, the problem is that once the tree is in place, rigidity, concession, discretion, and control become a problem.

b: Use blockchain to trace the pain tokens fired as environmental maladaptation signals of T. This signal should use a public blockchain to ensure objectivity from intra-organizational politics. An automatic process that accounts for the pain token tracing will transform the tree T into T´. Then, run an algorithm to reflect the signals of these pain tokens to the organizational structure and routing in a human-free manner.

Since it uses a public blockchain, the trace results are externally referable. The total amount of pain tokens that the organization has produced through its activities will appear like gas emissions. In this way, we will attempt to counteract the opacity of governance in dishonest companies and the like. If the organization does not disclose the tracing results, it will have to face the question from the public as to why it does not.

The members themselves are the ones who operate the pain tokens, and since they are anonymous and the blockchain ensures objectivity, fraud in the information input part is highly preventable. Instead, the problem seems to be the politics of how the pain tokens reflect the organizational structure and the update algorithm. We plan to discuss this separately at some point.

c: Depending on the state of the environment, reconfigure the organizational structure as actions referring to past learning results. In the figure, N(T) and N(T´) appear simultaneously, but there can be many tree structures, and it is sometimes impossible to separate them clearly.

In this situation, heterogeneous tree structures live together in the organization, so relationships such as “boss-staff” reverse depending on the condition. If keeping such a dynamic structure has a higher adaptability and learning ability to the environment than a fixed tree-like organization, such an organization will have a robust competitive advantage. Since pain is subjective, it may be reduced by a free lunch (= consuming no physical resource), so to speak, independent of physical and statistical conservation, and therein lies the hope.

VI: From “Subject / Responsible” to “Pain Token / Distributed Change”

The use of AI and routing algorithms, described to illustrate the idea of pain tokens, is very conceptual, and realistically, it raises a variety of issues, especially around AI specification changes, such as lack of data, the impossibility of replication, unclear tasks, how to define rewards, and learning failures.

Considering these factors, routing change rules can be done mechanically, without the aid of machine learning, with straightforward rules whose meaning is obvious to everyone. However, in that case, the ability to adapt to the environment may be sacrificed. The point is to make it automated, decentralized, and explicit so that the responsibility and discretion of specific entities become as irrelevant as possible.

Then, if such a system were to work, the question might arise, “Who should be responsible if an organizational change occurs that is unfortunate for someone else?”

However, making a specific person or entity take responsibility is no longer effective in maintaining the system when it becomes complicated. It follows that the pain token is an attempt to replace the “subject / responsibility” pair with a “pain token / distributed change” pair.


Original idea and articles by Asaki NISHIKAWA,Draft written by Toshihiro FURUYA and Moya,Simultaneous editing by VECTION

This article is based on the “Blockchain and Revolution: What are the conditions under which decentralization can be a ‘revolution’?” and “r/place subjects and governance: Blockchain and interfaces that invite revolution.” We have extracted, added, and re-edited the parts describing pain tokens and PS3.

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