 Blockchain technology is said to have a transformative effect on the very foundations of how our economies function. The study of this new form of distributed economy may be called token economics, also termed crypto economics. In this video, we'll present an overview to the relevance and the significance of this subject as motivation for the rest of the course, where we'll be dealing more with the specific workings of these new forms of economic organization. Economic forces are everywhere. They shape and structure our everyday lives in how we organize people, resources and technology to create and exchange value within society. During the modern era, those forces came to be channeled and structured within a particular set of centralized bureaucratic institutions based around the nation state and the enterprise. But today, the proliferation of the information networks is once again unleashing those economic forces. Given that the ledgers are the records of all value within economy, as these records of value move to a new system based upon distributed networks, some of the most fundamental rules governing our society are now, once again, up for grabs and open for redefinition. As advanced economies move out of industrial production and into a new form of global services and information economy, so too the economic model of the industrial age is becoming eroded. The once well established structures to modern economies are becoming redefined as resources start to flow through our newly formed information networks. This emerging global information and services economy will be coordinated through the internet running on an updated set of protocols that provide the secure and distributed infrastructure for these new forms of token economies. This transition built upon major trends that began in the late 20th century, which are today converging in powerful new ways. Privatization and globalization, financialization and the rise of online platforms are all converging as blockchain networks merge economics and information technology to take us into a new economic paradigm. Privatization opened up more spheres of activity to markets. Globalization expanded those markets around the world. Financialization connected up our real economy into an integrated information based financial system. The platform economy created new forms of user generated networks. The blockchain brings these previously latent disparate trends together in synergistic powerful new ways and a new economic system is being built on top of these previously disconnected building blocks. One that is truly global that reflects the underlying logic of services, an economic model that is for the first time in harmony with its underlying technology of information. These emerging token networks now offer the potential for unleashing a massive wave of creativity and innovation as vast flows of financial capital and supply chain information start flowing along these newly built channels. Trillions of dollars of securities are now about to migrate onto blockchain networks, equities, bonds, venture capital, not to mention the world's currencies. With trillions of dollars set to migrate to this global cloud computing infrastructure of the blockchain in the coming decades, the stakes are high. As financial and economic sovereignty appears to be slipping out of the fingers of nation states, the tensions are mounting. Are we moving into a lawless chaos or are we moving to a new level in the ever evolving history of economic organization? That will largely be decided by our capacity to understand this new economic paradigm coupled with our ability to actually design and develop these token networks. The blockchain is certainly a hugely disruptive force but disruption without redesign is a dangerous activity, particularly when applied to the most fundamental structures organizing our societies. There is a very significant need to rebuild economic structures, to realize the new possibilities now presented, really thinking how we organize economic production in exchange. It's one of the major challenges and opportunities that we're now presented with given this new technology. Token economics is an opportunity to revisit the foundations of economic organization and from that to reconstruct a new form of economy that is very different from the industrial model that we know so well. It is an exercise that is of critical importance to the development of a sustainable model to economic development in the age of information, globalization and billions of people wishing to join a formal economic system that is already showing major signs of stress. This is no longer about politics, policies or protesting, the technology is reaching maturity. We now really stand at a point where we can literally design economic systems from the ground up and the success or failure of those systems does not rest with the actors in the network but squarely with the design of the system. Possibly for the first time it is the case that if we don't like the economic system that prevails we do now have the option to design a better system directly through information networks. What is so powerful about this blockchain revolution is that it's not really driven by idealism or politics but rather economic incentives. The global economy will switch to being based upon distributed blockchain networks with each actor seeing it as in their economic interest to make that move. What is more, this revolution does not require large scale political coordination. Indeed it actually bypasses it all together instead employing a highly modular and granular transition. Specific parts of existing economic institutions can be upgraded in an asynchronous fashion. Indeed in many cases they may be backwards compatible interoperable with legacy processes and structures. We can only begin to scratch the surface when it comes to tracing through the implications and ramifications of such a profoundly disruptive transformation. Enterprises will be automated, whole industries will be upended by powerful new blockchain ecosystems and national governments will face mounting pressures from a global information services architecture. This new economic paradigm holds out the potential to build new forms of economic organization, networks that go beyond pure economic utility and GDP to incorporate all relevant parameters and value sources to capture, define and deliver what people really value. A distributed economy can be more open and thus inclusive, harnessing the efforts of the many instead of the few. It can secure property rights, reduce trade costs and integrate billions of people into the global economy in a more effective way. But still a huge infrastructure of information technology and economic organization has to be built to do that. And that's a project of blockchain networks and token economics.