Let us first imagine how an ordinary real estate mortgage financing is completed under the new economic paradigm (8-dimensional capital is working to make this application scenario a reality, so stay tuned).

One day in 201X, Wang Wu, who lived in Beijing, planned to mortgage one of his properties for financing. After he posted this "financing tender" through an "online mortgage service provider", he soon received offers from lenders from many parts of the world. Wang Wu's "smart financial advisor"-Awa has conducted a detailed analysis of every valid quotation and gave Wang Wu several choices. Wang Wu finally chose to conduct the transaction with a Mr. Frenchis located in the suburbs of Paris. Let's see how this deal works out:

Frenchis also has his own "financial advisor" - Mafa. Frenchis has some living cash to invest, and he prefers home mortgages, so Mafa is constantly scouring the web for potential investment opportunities: it has contracts with many "online mortgage servicers" and similar institutions. Contract: The contract mainly stipulates that the service provider provides information on the needs of potential financiers and agrees on which "real estate blockchain" to use to complete bookkeeping and transactions. Mafa needs to fulfill confidentiality obligations, can query blockchain data, and promises to pay a certain fee to the service provider if the transaction is realized.

A few seconds after Wang Wu’s financing demand information was released, Fama quickly got this information and started its due diligence, evaluation and analysis work: performing a right confirmation analysis from the real estate blockchain registered by Wang Wu , call various resource databases on the network to analyze Wang Wu’s credit, and check some water and electrical equipment data, maintenance logs, etc. of the property from the Internet of Things; Fama uses Google’s augmented reality smart agent (VR/ER smart agent) , analyzed the internal conditions of the property and the image data of the surrounding conditions. After synthesizing all kinds of information, it carried out a valuation calculation on the property, and finally Fama made a consulting suggestion to Frenchis for the mortgage loan.

Frenchis was getting ready for bed. A reminder message from Fama popped up on his mobile phone: He was advised to make this deal with Wang Wu, and a detailed analysis report and consultant advice were attached. Fama has helped Frenchis complete many similar investments before, and he already believes in Fama very much. After looking at the main terms sheet of the contract provided by Fama, he pressed the confirmation button when he felt that there was no problem, and fell asleep.

After receiving Frenchis' instruction to confirm the transaction, Fama immediately sent Wang Wu the "tender" for this "financing bidding": using the smart contract version number GMLMA-201X-1.1.2 Criteria to complete this deal, offers and other key terms.

Wang Wu's "smart financial advisor" Awa is currently analyzing every "tender" received. Awa carefully evaluates the terms of tenders, analyzes lenders' information and compares the merits of each tender. In the end, Awa gave Wang Wu 3 choices including Frenchis. Wang Wu was having a meeting with the client in the conference room at this time. After seeing Awa's information reminder on his mobile phone, he consulted several of its suggestions. Wang Wu felt that it was good that Frenchis chose to use RMB to complete the transaction, so he confirmed it.

After receiving Wang Wu's confirmation instruction, Awa immediately had a "conversation" with Fama: We can sign the contract. At this time, Awa drew up a smart contract according to the smart contract standard agreed in the bidding, and sent it to Fama. Fama no longer needs to let Frenchs review the smart contract because it has received the authorization. At this time, it only needs to review whether the standards are met. After the review, Awa signed the mortgage financing smart contract with Fama, numbered GSC000101. This smart contract is actually a program script that can be automatically executed according to the terms of the contract. When executing this smart contract, it is actually executing this program script on a certain platform.

When the smart contract signed by Awa and Fama is executed, it will arrange the delivery of this transaction: Frenchis provides funds to Wang Wu; Wang Wu mortgages his property to Frenchis. Wang Wu's real estate mortgage procedures are carried out on the real estate blockchain. This blockchain was established by a coalition of government agencies in multiple countries: Wang Wu’s real estate registration procedures have been mapped to the blockchain by the earliest database of the Beijing Municipal Housing Administration in accordance with the blockchain alliance protocol. In this way, as long as the mortgage operation is made on the blockchain, the alliance blockchain will automatically update the data on the blockchain on the one hand, and on the other hand will update the database data of the Beijing Municipal Housing Administration in accordance with the alliance agreement, so that Keeping the state of the property is always in sync with the blockchain.

On the one hand, the smart contract completes the mortgage registration operation on the blockchain, and on the other hand, the funds are settled from Frenchsi's digital wallet and paid to Wang Wu's digital wallet. This completes the entire transaction.

The main purpose of the examples conceived above is to show how the convergence of various technologies can change the way we operate economically. We have seen how technologies such as artificial intelligence, Internet of Things, smart contracts, blockchain, and big data are integrated into one economic activity. We cannot predict exactly when such scenarios will materialize, but we are sure that they will come soon: all the basic components to build this new economy are already in place.

Let us think in reverse and see what kind of cyberspace structure can realize the application envisioned above? In order to realize such a transaction, the author believes that cyberspace should be "portraited" as shown in the figure below.

This diagram presents the economic topology of the next generation cyberspace.

The cyberspace structure can be divided into five levels, namely:

• IoT layer

• internet layer

• smart contract layer

• smart contract layer

• blockchain layer

There are standard protocols for conversations between layers and between layers, and each layer can be divided into several sub-layer structures. For example, the Internet of Things layer can be subdivided into "perception layer" and "cognitive layer". Let’s take a look at each of these building blocks for building a cyberspace economy:

The Internet of Things layer is the layer closest to the earth's geographic space. It is the interface and data interaction network of the "physical" connection between the entire cyberspace and the earth's geospatial space. Events in geographic space [5] can be "perceived" by the Internet of Things layer, and mapped to the "cognitive layer" in the Internet of Things layer in the form of data. The cognitive layer is supported by technologies such as big data analysis and cloud computing. , providing knowledge of these perceptions. And provide these cognitions to its users in various forms.

The Internet layer provides various connections needed in the network. It is the network we are familiar with based on the TCP/IP protocol. Its core function is to establish "connections". This connection takes many forms.

The artificial intelligence (AI) layer is a network that provides various intelligent agents or artificial intelligence services. Artificial intelligence will become an "infrastructure" like running water and electricity, and people can purchase various services it provides on demand. Each of us will have one or more artificial intelligence (AI) to assist and even help us complete some transactions on the Internet. These artificial intelligences will be able to provide a wide range of services from simple personal assistants to advanced financial investment advisors. It is foreseeable that almost everyone will have their own artificial intelligence assistant or advisor in the future to assist people in coping with increasingly complex and frequent economic activities in cyberspace. Artificial intelligence (AI) has become a must-have for people to carry out cyberspace activities just like today's smartphones.

The idea of ​​smart contracts first came from Nick Szabo. After later development, it has gradually become the basis of the contract management system in the network space to solve the massive, single small amount, and no trust center environment. A contract is simply an offer, a promise, and an act of value exchange. The technical concept of value exchange is consideration. While many contracts must be in writing, many do not. And, no matter what you call it, if there is an act of bidding, accepting, and exchanging value, then it is a contract. All contracts contain three basic elements: an offer, a promise, and an exchange of value (consideration). In most cases, contracts without a chosen jurisdiction will be exposed in multiple jurisdictions, which will lead to disputes, increased uncertainty, risk, time consumption and overhead.

Therefore, most economic activities in cyberspace are interregional, sovereign, and jurisdictional. It is therefore imperative to choose an appropriate legal framework, jurisdiction and adjudication process.

How to maximize the recognition of smart contracts in various jurisdictions? The simplest answer is: Include a written arbitration clause in every contract. According to the New York Convention (technically called the Convention on the Recognition and Enforcement of Foreign Arbitral Awards), commercial arbitration provides private judgments that can be enforced in public courts in more than 150 countries. The New York Convention requires member states to recognize and enforce most foreign arbitral awards. UNCITRAL adopted a "Recommendation" on July 7, 2006, which is intended to recognize the increasingly widespread use of electronic commerce and the enactment of some domestic legislation and case law on the formal requirements of arbitration agreements, arbitration procedures and enforcement. Arbitration awards are more favorable than the New York Convention.

The details of this convention and other enforceable law are beyond the scope of this article, but an effective arbitration clause must be: written, include the law and process chosen, define what disputes are (or are not) to the extent of arbitration, and can Necessary regulations in the applicable rules.

Why do these things? If done well (with any counterparty from one of those 150 countries), a local court must enforce the arbitration award. If we combine an arbitration clause with a well-executed arbitration hearing, the local court doesn't need to decide whether your smart contract is valid or who won. The arbitrator you choose decides matters related to your smart contract, including who wins and who loses. The arbitrator will then make a decision (also called an award), which is binding on both parties. If the losing party is unwilling to voluntarily abide by the ruling, the winning party can take the ruling to the local court where the losing party is located and say "please enforce this". As long as the arbitration is properly conducted, the local court must enforce the award without any challenge to the arbitration process.

Arbitration clauses allow you to tailor every aspect of the process: location, duration, language, medium (video or in person), etc. This further reduces uncertainty and allows parties involved in the transaction to have a better understanding of the process control. The smart contract realizes the uncertainty of disputes and reduces the risk to the minimum through the careful programming of these processes.

Due to the widest jurisdictional recognition and precise procedural control, the "smart contract" has become a contract that can be fully autonomously "performed" by the parties to the contract and their counterparties. : If the contract is performed, the consideration will be executed; if any party breaches the contract, the liability for breach of contract will be accurately arbitrated to one of the parties, and the non-defaulting party can obtain the compensation or exemption from liability obligations stipulated in the contract without spending too much time and cost.

Blockchain is an open autonomous ledger system. Due to the great advantages of blockchain, the advantages of adopting blockchain to bookmark economic activities in cyberspace are very obvious. We can even predict that bookkeeping standards and clearing protocols in the future cyberspace should be based on the development and evolution of the current blockchain technology. Economic activities in cyberspace will only be divided into two forms: "on-chain" and "off-chain". "On-chain" economic activities will be processed faster, better and more safely due to their core advantages; conversely, "off-chain" economic activities will require more time, more audits and Handle without additional safeguards.

The importance of digital currencies to economic activity in cyberspace is obvious. Payment, clearing, settlement in cyberspace and which digital currency is adopted will have very different impacts. At present, digital currency should coexist in two basic forms: the legal digital currency issued by the central bank and the digital currency issued by the private sector. The legal digital currency issued by the central bank still assumes the "currency" function of the traditional monetary policy framework, while the digital currency issued by the private sector is more of a "token" and plays a greater role in liquidation.

There may be more components, and other forms, of the economic topology of cyberspace. But the author believes that these items are the most basic and important basic components, and they have been able to build a completely different economic paradigm. It's like being able to construct very complex things with only a few Lego "blocks". Economic activities in cyberspace will develop rapidly beyond the cognition of our existing economic theories, and we are still unable to accurately describe its full picture.

We have every reason to believe that more economic activity in the future will "happen" in cyberspace rather than traditional geographic space. In the past ten years, we have seen a huge change in e-commerce from zero to gradually replacing traditional commerce. Correspondingly, no suitable theoretical framework has yet been established to analyze e-commerce, and research on the economics of cyberspace more generally is still at a very early stage. There is little research specifically on the economics of cyberspace.

"Spatial economics," pioneered by Krugman et al., has become one of the most exciting fields in contemporary economics. Spatial economic theory is regarded as the fourth wave of the revolution of imperfect competition and increasing returns.

In the field of economics, unlike time, "space" has not been successfully incorporated into the mainstream of economics for a long time. Why has the issue of "space" been a blind spot in mainstream economics? This is no accident of history. Due to certain characteristics of spatial economics itself, it is essentially an area that cannot be handled by the kind of modeling techniques mastered by mainstream economists. And this feature refers to the market structure problem when there is increasing return. Krugman believes that the reason why mainstream economics ignores the issue of space is not because the issue of "space" is not important in our lives, on the contrary, it is important only because economists do not have the necessary research tools. "Economists also don't study the spatial aspects of the economy because they know they can't model spatial factors," he said.

The spatial economics pioneered by Krugman and others has developed into a branch of mainstream economics. It examines where economic activity occurs and why it occurs there. Why is it important to study the spatial characteristics of this economy? Krugman explains three important reasons:

• First, the location of economic activity within countries is an important topic in itself;

  
  

• Second, in some important cases, the line between international economics and regional economics has become more and more blurred. For example, it is less and less meaningful to use the standard international trade paradigm to talk about the relationship between EU member states. ;

  
  

• Third, and this is the most important reason, the new trade theory and the new growth theory tell people a new economic world view, but it is difficult to find convincing evidence from the traditional trade, growth and business cycle theories. illustrate. This is how the world economy actually operates, but when studying the location of international and domestic economic activities, such evidence is not difficult to find. Therefore, spatial economics provides a theoretical framework of thought and evidence for new trade theory, new growth theory, etc. .

The basic problem of spatial economics research is also the core problem, which is to explain the agglomeration of economic activities in geographical space. Its core modeling strategies are "D-S model, iceberg cost, dynamic evolution and computer simulation.

Based on the principle of mathematical equivalence, if geographical space is regarded as "space" in a narrow sense, and cyberspace is regarded as a "topological space" of geographical space, then can we use Krugman's basic ideas of spatial economics to construct An analytical framework for the economics of cyberspace? Based on such assumptions and basic observations, the author believes that the core issues of cyberspace economics research should include the market structure of increasing returns in cyberspace; the agglomeration of economic activities in cyberspace; and the decentralized self-organizing economy of cyberspace .

Current trade and investment rules are based on geospatial economics. Within this framework, geopolitics dominates the formulation of these rules. Whether it is WTO, 3T, or Free Trade Area (FTA), all of them are products based on geographical space and geopolitical considerations.

We have seen that the cyberspace economy, while a topology of geospatiality, has greatly transcended traditional geopolitical frameworks. We need a brand-new perspective and theoretical framework to examine it, and based on this, formulate rules that are more suitable for its inherent characteristics. Some fundamental questions require us to find answers:

• Is there a need for Trade and Investment Rules in Cyberspace? Who will make this rule?

  
  

• What is the relationship between "Trade and Investment Rules in Cyberspace" and the existing WTO, 3T and many bilateral and changeable FTAs?

  
  

• When countries attach great importance to cyber security and regard cyber security as an important part of national security, how should trade and investment in cyberspace be included in these systems? How should these systems respond to the growing economic activity of cyberspace?

Through the brief explanation above, although it has not been very rigorously demonstrated, we can still see that trade and investment rules based on traditional geographic space (including WTO, 3T, FTA) are a continuation of geopolitics. The various rules evolved under this framework are a response to geopolitics in a certain period. Different from the constraints of traditional geographical space, the cyberspace economy provides a broader and unprecedented development space for various economies and individuals. Therefore, it is very necessary to study the economics of cyberspace and the rules of trade and investment brought about by many innovative technologies. Such research is especially necessary and urgent for China today.