Find the Prologue and first chapter here.

Frank was almost done with his lunch, as well as with a quick scan of The New York Times web site. Huh. A blockchain article on the business page. That was unusual. The Gray Lady hadn’t paid much attention to blockchain yet.

The title of the article was Your bitcoin or Your Life.

A pop-up alert opened on Frank’s computer, interrupting his train of thought. It said it was almost time for his call with Vijay Patel, the guy he was replacing on the GFBS Foundation Board. Okay.

He went back to the article. Apparently, cryptocurrency thefts were no longer limited to virtual exploits. Now face to face robberies were occurring around the world. In each case, people indiscreet enough to brag about making a killing in a cryptocurrency, usually bitcoin, had answered their door to find armed men threatening to kill them unless they transferred hundreds of thousands, or even millions, of dollars’ worth of bitcoin to the thieves’ anonymous, untraceable, accounts. How about that. The perfect crime.

The ringing of his phone startled him. “Hello?” he said.

“Hi, Frank. Vijay Patel. Hey – thanks for taking over the GFBS board seat on so little warning.”

“Sure. No problem,” Frank said. “Thanks for calling to fill me in.”

“No problem,” Patel said. “So, let me give you a quick overview. Let’s start with how the GFBS project is run. As you know, there are tens of millions of open source development projects out there, the great majority of which are tiny or inactive. At the other end of the spectrum are a hundred or so big, important projects, most of them heavily funded by the largest IT companies in the world. Those big projects usually have a board of directors to take care of the business side of things, and a technical steering committee made up of software developers, which calls all the shots on the technical side.

“That’s the setup at GFBS, and First Manhattan’s a Platinum Member, along with fifteen other companies, mostly banks but also some technology vendors. The five hundred thousand bucks a year we pay for that level of membership buys us a guaranteed board seat. On top of that, we have to commit two of our best programmers to work full time on the project as well. All in, that sets us back about a million a year, after you take salary, bonus, benefits and travel into account. So, you can see how important the bank thinks direct, high-level involvement in this project is.”

“Any reason beyond the obvious one, that we want to make sure it’s good code?” Frank asked.

“Actually, yes,” Patel said. “We think there’s no doubt whatsoever that every kind of transaction in the future is going to take place on a blockchain. Depending on how those blockchains are designed, banks are either going to be sitting pretty or left on the sidelines. We’re only going to get one shot at this, and we want to make sure we get it right.”

“What’s an example of how it could go wrong?” Frank asked.

“Well, think what’s changing,” Vijay said. “If the blockchain solves all the problems of security, transparency, and speed, who needs a bank at all? All a customer needs are access to the blockchain, someone to maintain their wallet, and a transaction app.”

“Yeah,” Frank said, “But do you think everyone’s going to be comfortable with that?”

“Really?” Patel said. “Look what happened to stock brokerages. Before the Internet and mutual funds came along, everybody had to have a stock broker who gave you advice and suggested what stocks and bonds to buy and sell. The only thing that really made them necessary and special was the fact that they had seats on the major stock exchanges, and you didn’t. Back then, only people who were actually standing on the floor of an exchange could execute a trade. When they did, the brokerage they worked for charged you a hefty fee.

“But once the Internet came along, it provided an opportunity to replace old business models with new ones, and that’s exactly what startups like eTrade did. With no individual brokers, no brick and mortar offices and no research reports, their overhead was a small fraction of the traditional brokerages. All they had to build and support was an automated trading platform and some good software tools, and you could order your own purchases and sales of securities without ever having to talk to a human being.”

“So, I guess you’re right,” Frank said. “If I was launching a startup, I’d build a consumer app that looks just like the on-line banking software most people are already using.”

“Exactly,” Patel said. “So, we need to do to ourselves what eTrade did to the brokerages. We need to adopt the blockchain so that we can cut our overhead and our fees before somebody else offers the same services we do for much less. Luckily, we’ve got a lot of advantages – the customers, the IT departments, the regulatory expertise, the lobbyists – but if we don’t do it fast and do it right, we’ll be in big trouble.”

“Okay, thanks,” Frank said. “I get the picture.”

“Good,” Patel said. “So back to my overview. The directors control the overall functional design and constraints of the GFBS platform and make all the other strategic decisions, like how to promote the GFBS, and making sure the regulators don’t get in the way. They also have to take care of the nuts and bolts stuff, like approving a budget and making sure the bills get paid, and maybe most important of all, keeping the developers happy.”

“And are they?” Frank asked.

“Ah, well, that’s always an interesting question, isn’t it?” Patel said.

“How so?

“Hmm,” Patel paused. “So, you’re a developer, aren’t you?”

“Sure. Why?”

“So, how to ask delicately? What’s your opinion of the emotional maturity of some of the best developers you know?”

“Oh. Okay. So, you’ve got some personality issues on the TSC?”

“That would be an understatement. It’s a challenge keeping them focused on the current release instead of setting off flame wars and going down rat holes on things that don’t matter.”

“What about Schwert?”

“Oh, if it weren’t for him, we’d be sunk. The guys a rock. Always on message, always getting things back on track when they get derailed.”

“Have you met him?” Frank asked.

“No. I don’t think anyone has. In fact, I’ve never even heard his voice. All the interaction is on line. But that’s okay. The guy’s incredible. Anyway, let’s switch over to the Manhattan release. All the banks have been testing it on a virtual platform for a month now, and we’re satisfied it’s stable. At midnight this Friday, we’ll cut over to running live transactions on it, but in parallel to our existing processes. If all goes well through Wednesday, we, and all the other banks, will shut down our old systems and run solely on the blockchain.”

“That’s a big step,” Frank said.

“You bet it is! And it better go right.”

“But if we’re going to have a problem, better sooner than later, right?” Frank asked.

“Well, yes and no. Once we’re on the blockchain, it would be a nightmare to have to cut back over to our old systems. But that’s true any time a bank switches its platform. The beauty of the blockchain is that no matter what happens, we always could. Every transaction would be there on the blockchain transactional record, out in the open where anyone can see it, because the blockchain is open source and GFBS will be on computers all over the world.”

“I guess,” Frank said. “Still, it’s awfully new technology. Doesn’t that make you nervous!”

“Hell yes!” Patel said. “But it’s too late for that. Estimates are that one week from now, 95% of all international banking transactions will be completed on GFBS. And most of the domestic ones, too.”

*  *  *

Frank settled into his air shuttle seat and looked out at the Manhattan skyline.  There was a storm in the distance to the west, and a towering thunderhead soared forty-thousand feet into the air. The top of the column of clouds was gleaming white, but its nether regions were a dusky orange mass in which lightning flickered. He looked at his watch. If they didn’t take off soon they might not be able to take off at all. He looked back out the window and decided the jet-black silhouettes of the tall buildings against the fiery sunset suggested the towers and parapets of some medieval city, its gates barricaded against the approaching horde of a barbarian army.

That image matched his mood. Patel’s prediction earlier that day had stuck with Frank: 95% of all global banking transactions were about to start running on a technology platform that until a few years ago was chiefly used to complete illegal drug sales. Not to mention the number of hacks that had already resulted in hundreds of millions of dollars in bitcoin and other cryptocurrencies being stolen or simply disappearing – ten percent of all the cryptocurrency that had ever existed! What were the banks thinking?

Well, he’d found out the answer to that question earlier in the day. For five hundred years banks had grown fantastically wealthy by being the middlemen, always keeping something for themselves when money changed hands. Sometimes what they kept was substantial, too. When some poor immigrant sent home a few hundred, hard earned dollars to his family back in Guatemala, the middle man kept as much as ten percent of it. It was effectively highway robbery, but there was nothing anyone could do about it, because the banks owned the only highways there were. At least until now. With a blockchain, the same transaction could be completed by anyone for a penny.

The pilot asked the flight attendants to take their seats, and the plane began taxiing towards the runway.

The big surprise was that the banks were being more realistic than all of those other businesses that had done nothing and watched as their business models were destroyed. If the banks played their cards wisely, and had a good bit of luck besides, they stood a chance of hanging on to their central position in the financial world.

Well, so be it. Frank thought, as the plane swung around onto the runway. As usual, the banks would take the world wherever they wanted to, whether it was good for humanity or not. Would this precipitous move onto the blockchain be a good thing, or would Wall Street drag the global economy down with it yet again, just as it had in 2008 and so many other times before?

Who knew? Frank thought, as the plane rumbled down the runway, gathering speed and momentum until it lifted off and thundered into the troubled sky.

*  *  *

Author’s Notes for this Week:

This week’s and last week’s chapters were heavy on technical details, as well as details on how open source software is actually created – in this case, by a fictional open source development project called the Global Financial Blockchain Software Foundation. I’ve represented many similar entities developing all sorts of infrastructural software, including some of the largest and best funded in the world, and all of the details are accurate.

As of now, I’m not sure whether I’ll have a subplot that involves the developers and Board of GFBS Foundation or not. If I do, it will likely follow upon on the brief exchange relating to the relationship between the Board and the TSC (Technical Steering Committee). The Executive VP’s concern that Hohndel recounted to Frank last week – about top management not being able to tell its own employees what to do – is a real quote I heard during a board meeting. For those with a historical perspective, this represents one of the biggest reversals of management – labor bargaining power in history.

Also still to be determined is whether I’ll develop a subplot about the greed and tactics of banks. Since I start with only the briefest outline when I start a book, I give my characters substantial freedom to tell me where the story should go.

I also greatly value the input of alpha readers as well. Traditionally, my daughter Nora is the one who gives me the most detailed and helpful suggestions. This time, I’m hoping that you will as well. I’ve already decided to adopt one – Frank R’s suggestion that I develop the Cryptomancer into a character. My first inclination was to leave him as a shadowy presence in the background, but Frank R has convinced me that there are some great plot and dramatic tension opportunities to be derived from making him an active part of the plot development. My current thoughts include his launching social media campaigns to advance his strategy as well as to mislead Frank.

And looking ahead, my daughter Nora has me thinking about the possibility of introducing both a Russian as well as a US agent as well. Wrap all that together, and if you go back to Chapter 2, you’ll see that it now ends as follows:

Ryan Clancy set the report aside and stared thoughtfully at nothing in particular. So, First Manhattan had hired Frank Adversego to keep an eye on the GFBS. That was interesting.

Eighteen months before, the U.S. Federal Bureau of Investigation had appointed Clancy to lead a new [special investigations unit] in response to a growing wave of cryptocurrency thefts and fraudulent activity. His team had grown rapidly along with the number of investigations he was responsible for managing. He had over a hundred-people working under him now, from field investigators to programing and cybersecurity experts.

Should he invite Adversego in for an informal chat? Frankly, he could use all the help he could get. And yet…

He’d heard rumors inside the Bureau about some of Adversego’s prior adventures, not all of which had made the FBI look good. The guy had a well-known independence streak. And there were still unresolved questions regarding the conduct of his son-in-law in connection with the barely thwarted attack launched by the Caliphate.

He walked to the window of his office and stared out across Pennsylvania Avenue at the anonymous, neoclassical façade of the FBI’s old home, the Robert F. Kennedy Department of Justice building. Unlike the FBI’s new home, it was almost indistinguishable from all the other buildings in the federal triangle of the same era.

No, asking Adversego in wouldn’t be a good idea. He was still under a cloud as part of the [  ] debacle, and it wouldn’t do for Clancy’s calendar to show a meeting with him. But at the same time, the GFBS was too big and attractive a target. If it got hit, everyone would wonder how the FBI had allowed that to happen. Clancy wished there was a way he could know anything Adversego might discover before it turned into something serious.

He made up his mind. He could easily justify placing an agent on the GFBS project at First Manhattan. Of course, the bank would have to know. But there was no reason Adversego would.

*  *  *

The Cryptomancer smiled as he read the press release. So, the Great Frank Adversego has been recruited by the other side. So much the better. Without worthy opponents, victory would never be as sweet.

Still, having a skilled adversary increased the chance of failure. He would have to give this new development some thought.

Why Ryan Clancy? As long-time readers know, I like to have some fun with names. And I happen to be reading Tom Clancy’s masterful The Hunt for Red October at the moment.

So – that’s all for this week. Tune in again next time for your Weekly Dose of Frank.

Continue to Chapter 5 here