Discover more from Economics Design Newsletter
EP 2: It's Coronanomics
Evolution of viruses and your business
We can learn so much from biology and how it adapts to changes in the environment. Taking the lesson from Coronavirus, I'm keen to figure out the mechanisms in which viruses adapt and mutate as a result.
In this episode, we want to answer 3 fundamental things:
What drives evolution?
What role does the environment play in evolution?
How can we apply this to designing complex evolving economic systems?
Biology Crash Course
Before we get started, let's have a quick crash course on biology.
Genes are the basic unit of hereditary information. They are the language that nature uses to build, maintain and repair organisms. It keeps information and data to build proteins, so we can function normally, like you listening to this podcast.
In simple words, genes are basically ingredients and herbs. They follow a recipe to cook a delicious meal. then we can eat that meal.
Initially, I wanted to talk about DNA and its evolution since the beginning of homo sapiens. But that takes hundreds of thousands of years, so I'll focus on the evolution of viruses instead. They evolve faster. Specifically, coronavirus.
About Coronavirus and how it evolves
Coronavirus is the hot topic of this period. It's the cause of common cold. Now, this strain of coronavirus is different because it is able to transmit from animals to humans, then between humans. This is part of the evolution that we will discuss today.
There are many types of coronavirus over the years. It spreads from animals to humans and between humans.
SARS: bats → civets → humans
MERS: camels → humans
nCoV: bats → humans
Virus Evolution and Mutation
There are 3 ways viruses can change: mutate, pseudo-recombination, recombination. In this episode, we will focus on mutation.
Virus can mutate in 2 ways, either mutating the human genome or to change its own genome. This coronavirus that we are focusing here changes its own genomes.
Why? Because mutating human genome is hard whilst changing its own genome is easier. It's like changing the entire recipe instead of replace specific ingredients to cook your meal. Swapping out butter for oil is easier than changing from baking a cake to cooking risotto.
Mutation is a Norm
Fret not, virus always mutates. It is a natural part of the virus lifecycle. And that is alright because there are plenty of errors in mutation and it is not dangerous. For mutation to become more prominent, multiple genes have to agree to the mutation and mutate. That means these decentralised genomes have to decide that they want to change and coordinate that change.
This mutation is helpful for us to understand how virus travels and changes.
As the virus evolves, it mutates in its genes structure. This new genes structure binds to human proteins, replicates and spread to other humans.
Let's look at the example of dumplings. It has a general structure, as in flour wrapped around meat. It mutates and changes according to the various country's culture and environment. E.g. India momos, Polish perogies, Japanese gyoza, Chinese jiaozi or even Italian ravioli.
These country specific dumplings have binded to humans. It replicates, spreads and becomes the new norm of cultural food in that country.
RNA vs DNA Crash Course
This virus is specifically an RNA virus.
Crash course on RNA vs DNA:
DNA is like a top chef, say Gordon Ramsey. He has all the recipes and methods in his head. To cook a dish, he has his recipe book or all the recipes in his head. Ramsey has tons of experience cooking. He has the master blueprint. DNA is also the mater blueprint. It has all the information like genetic data inside.
RNA is like me, amateur chef that learns after watching 1 youtube episode. It's easy to follow and you just copy whatever Ramsey does. I'm basically translating the specific recipe into steps, so I can follow.
He has so many recipes. I'm not going to translate or transcribe all. I'm just noting the specific recipe I'm interested in, for today's meal.
But sometimes, I forget a step or ingredient. And I missed it, or cook it in the wrong way. I don't have all the data at the back of my head. So I make these mistakes. RNA doesn't have all the information, unlike DNA. It just takes the information it needs.
Covid is an RNA virus. That means it is easier to make mistakes, mutate and change. Long story short, the virus binds with ACE2 to initiate membrane fusion and enter human cells.
So think of it as me having make up and wearing Gordon Ramsey's clothes to pretend to be like him and cook in his kitchen.
Why is it important to determine if it is an RNA virus? RNA-based viruses like the coronavirus or the flu tend to mutate around 100 times faster than DNA-based ones. That means we are racing against time to understand the mutation pattern of the virus.
Listen on Spotify
Fundamental issues relating to evolutionary patterns and driving forces
Let's now unpack some fundamental drivers to virus evolutionary patterns:
Mutation occurs as part of the evolution. But it doesn’t always last. Biologically, 87.6-95.6% of mutations are removed by negative selection. The mutation just does not survive because the mutations are not beneficial. The mechanisms of evolution is where the organisms that are better adapted to the environment survives. That means we have to adapt as evolution happens, and not demand the environment to adapt to our changing needs.
Network effects of mutation. Mutation depends largely on its environment, not just how warm it is, but also how close people are. We call this network effects. There are 2 strains of coronavirus, L and S type. The transmission rates are different for the strains. The L-strain is more dominant due to its ease of spread and how close people are to each other. Hence, policies are in place for people to stay at home, reduce network effects and flatten the curve.
Proper resolution mechanisms: The increasing numbers of viral sequences has led to unprecedented observation of viruses as they evolve, we now have better understanding of the factors that lead to the virus' evolution. Research is designing new strategies to govern the viral evolution and control the threats.
Modeling: virus evolution can be informed by computational modeling based on experimental data. Shoutout to CADCAD when we are looking at modeling the economic design of virtual ecosystems!
How to apply these lessons to designing economic systems
Understanding the speed of change and mutation over time. to estimate the clock and track spread. It is useful in times like this, where we see how DeFi systems react, or engage beta-testing to understand the models. Why? So we can better manage it when shit happens (again).
Understand breaking points, eg when a virus/bad actor messes things up. How long can it be deployed successfully before a resistance-breaking (virulent) strain of the virus emerges? There are multiple factors, including the virus resistance mechanism, the number of mutations sufficient to generate virulent/aggressive variants, and the effect of these mutations on virus fitness; all can contribute to an estimate of resistance durability.
Build resistance when shit happens and estimate duration of how long that can last. (Points #2 and #3 work hand in hand.)
Blockchain is like our genomes, specifically pathogens. The pathogen’s job is to evade the immune system, create more copies of itself, and spread to other hosts. It's similar to blockchain copying the same data to every peer. Hence, it's important to ensure that genome is making copies of the right data, before it spreads to other hosts.
DNA is a more stable molecule than RNA. Hence, DNA viruses do not mutate as much. Stability is an important aspect of the make up of our DNA, as in the design of en ecosystem. The more stable it is, the less prone to rapid changes from the environment. With time and slower changes, the cells and RNA learn to collaborate and grow into a harmonious unit.
If DNA is the master blueprint for our cells that defines our body, being and lives, the design of economics systems is the DNA for virtual systems. It is the master blueprint for our system that defines the business model and revenue of economic systems.
Like viruses, ecosystems will continuously undergo co-evolution over a long period of time. Sometimes, a benign relationship develops and the virus does not cause a negative impact, aka disease. Other relationships are negative, aka causing serious disease to the human body.
The 2 main factors that changes the characteristics of organisms are the blueprint for ecosystem and the environment itself. And agents determine the make up of the ecosystem. We define the blueprint via governance and design. And we can coordinate the agents, hence the importance of community feedback, forums, company updates, etc.
This shows how countries who were prepared, with stronger epidemiological authority, education on hygiene and social distancing, and early detection and isolation, didn’t have to pay with heavier measures afterwards.
3 discussion takeaways worth pondering
Should we have a homogenous ecosystem? It runs counter to evolution and natural selection. We need mutation and variation to enable a company or ecosystem to evolve over time. Most companies present 100 years ago don't exist anymore.
Who is to judge what ecosystem or actions are "good" and "bad", which we will promote via the incentive mechanism designs?
Should we limit or encourage greater divergence (via decentralised governance mechanisms) as the ecosystem grows?
How coronavirus mutates. Molecular biology simplified: RNA vs DNA. Cross‐species transmission of the newly identified coronavirus 2019‐nCoV. How virus mutates differently in various countries (not peer-reviewed). On the origin and continuing evolution of SARS-CoV-2. Mapping the spread of a deadly virus. Viral Evolution: It Is All About Mutations. Policies in place by various government and how it flattens the curve. Animal to Human transmission.