Home' Technology Review : March April 2014 Contents 12
MIT TECHNOLOGY REVIEW
acclimated to it from many years of use,
it becomes a part of our own selves in
mind, body, and spirit.
This technology is only now becom-
ing available for large numbers of peo-
ple to use (see “Glass, Darkly,” page 70).
But it has already started to be banned
in some places. For someone who has
been inventing, designing, building, and
wearing such devices for more than 30
years, and who founded MIT’s wearable-
computing project more than 20 years
ago, being forbidden to use this tech-
nology feels like an affront to bodily
integrity. These devices are not simply
pieces of clothing or a variation on con-
ventional eyewear. They have profound
effects on how we see, understand, and
remember the world.
As more people grow to depend on
this technology in all facets of their lives
(for example, as a memory aid or face
recognizer), we must balance their rights
with the desire to allow other people pri-
vacy and confidentiality. It is absurd to
forbid people to remember things. Imag-
ine an elderly gentleman being asked his
whereabouts on a particular night, to
which he replies, “I was not allowed to
remember.” We can’t hold people respon-
sible for their actions if we prevent them
from doing what it takes to recall them.
My six-year-old daughter once asked
me, “Why do buildings and cars have the
right to wear a camera at all times, but
people don’t?” Our society has decided
that organizations and businesses always
have the right to use a camera for secu-
rity, but the right to wear a camera as an
assistive device seems less assured.
Let’s value people at least as much
as we do merchandise and elevate the
wearable computer to the level of a secu-
rity camera. We never forbid cameras
to protect five-cent candies. So let’s not
forbid people to protect themselves with
this same kind of technology. I have pro-
posed legislation to protect the right of
individuals to remember, computation-
ally, what they experience.
As wearable computers and cameras
become more widespread, we will cer-
tainly need to adopt new protocols and
social attitudes toward the capture and
sharing of visual information and other
data. But these protocols should not
include discrimination against users of
these valuable assistive devices.
Steve Mann is chief scientist at the
wearable-computing company MetaView
and a professor at the University of
The digital cash lacks most of the
features economists value in a
currency, says David Yermack.
Bitcoin became a sensation in 2013,
when the value of a single unit of the
virtual currency rose from $13 to more
than $1,000 and people began to use it
for daily commerce (see chart on page
18). Travelers toured the world subsist-
ing on bitcoins. A Bitcoin ATM appeared
in a Vancouver coffee shop. And a U.S.
Senate committee held hearings at which
regulators commented favorably on Bit-
coin and other virtual currencies.
Bitcoin is not issued by a govern-
ment or a business but by computer
code that runs on a decentralized, volun-
tary network. It has found users among
computer enthusiasts and opponents
of the banking system (see “Marginally
Useful,” page 80). However, economists
remain skeptical of Bitcoin’s staying
power because it lacks many attributes
of a useful currency. Money is supposed
to serve three purposes: it functions as a
medium of exchange, a unit of account,
and a store of value. Bitcoin arguably
satisfies the first criterion, because a
growing number of merchants accept it
as payment. But it performs poorly as a
unit of account and a store of value.
Bitcoin’s extreme fluctuations
undermine any useful function for it
in these roles. During 2013 its volatil-
ity was three to four times higher than
that of a typical stock, and its exchange
rate with the dollar was about 10 times
more volatile than those of the euro,
yen, and other major currencies. Bit-
coin’s dollar price exhibits no correlation
with the dollar’s exchange rates against
other currencies. Nor does it correlate
with the value of gold. With a currency
whose value is so untethered, it is nearly
impossible to hedge against risk.
Bitcoin also lacks additional char-
acteristics usually associated with cur-
rencies. It cannot be deposited in a
bank; instead it must be held in “digi-
tal wallets” that have proved vulnerable
to thieves and hackers. There is noth-
ing comparable to the deposit insur-
ance relied on by banking consumers.
No lenders use bitcoins as the unit of
account for consumer credit, auto loans,
or mortgages, and no credit or debit
cards are denominated in bitcoins.
Even if volatility subsides and the
currency finds a place in the world pay-
ments system, it has another fatal eco-
nomic flaw. Only 21 million units can
ever be issued, and a fixed money supply
is incompatible with a growing economy.
In a bitcoin-dominated economy, work-
ers would have to accept pay cuts every
year, and prices for goods would gradu-
ally fall. Such conditions might lead to
public unrest reminiscent of the late
19th century’s free-silver and populist
movements—an ironic consequence of a
currency known for its futuristic cachet.
David Yermack is a professor at the New
York University Stern School of Business
and director of the NYU Pollack Center for
Law and Business.
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