From: Joi Ito < Sent: Saturday, April 23, 2016 4:39 PM To: Jeffrey Epstein Subject: Re: rough draft of a paper on accounting OK > On Apr 23, 2016, at 12:35 PM, jeffrey E. <[email protected]> =rote: > some good points.. " in search of certainty," could be its =ubtitle. . I suggest more drilling on " value " . on types of hacks =o current system. etc > On Sat, Apr 23, 2016 at 12:12 PM, Joi Ito < > wrote: > Super rough draft on something I'm thinking about writing =bout accounting and book keeping. > Tell me if you think it's worth writing and if you have any =dea or > suggestions... > — > Reinventing Bookkeeping and Accounting > Double-entry bookkeeping was deployed in its modern form in the 13005 =nd while minor innovations have occurred since then, the fundamental =tomic unit of tracking and managing value - our accounting system - is =till based on this 700 year old invention. With modern computers, =etworks and cryptography, we have the opportunity to fundamentally =hange one of the most important and empowering, but also limiting =lements of modern civilization. > Accounting underlies finance, business, the management of the =tate's resources and is the way that the world keeps track of =lmost everything of value. While companies will keep track of how many =idgets, contractual obligations, employees they have and many other =hings, the accounting system and the laws that support it, require us =o convert just about everything into monetary value and enter it into =ome ledger system using the 700 year old double-entry bookkeeping =ethod. > When you take, for instance, a contract that pays out a million =ollars if it rains tomorrow, and put it into your accounts, you will be =equired to guess the chance of rain - maybe 50% - and value that asset =t something like $500,000. The contract will actually never pay out =500 - it will either be worth zero or a million dollars in the end, but =f you were forced to trade it today, you'd pr