Perhaps the most widely held misconception of our times is that technology is a neutral “tool”.   This fallacy is as pervasive as it is ridiculous, since all technology is somehow made in the image of its creator, endowed – perhaps I should say en-coded – with ideas and assumptions about the world.

The ubiquity of phones and wifi and retweets and digital has made it hard to remember the time when connected, always-on networks weren’t the normal or “neutral” state of affairs. Social networks are designed to connect everything and everyone, and to encourage more connection and sharing at every precious opportunity.  The internet itself is designed to be distributed, borderless, difficult to censor, public (the network needs your IP address to send information to your computer) and always routing for the quickest and most efficient connection. These ideas are deeply entrenched now: nearly all communists, Islamists, capitalists, anti-capitalists, and nationalists have bought into them. Silicon Valley has shaped our tools, and now they are shaping us.

These ubiquitous technologies and the new norms they silently create are starting to shape our cities, and how we live in them too. And that will create all sorts of new challenges for how cities are run. The rapid change brought on by digital technology will only quicken: the UK, and especially London and other big cities, will continue to lovingly embrace all things tech, especially in a potentially turbulent post-Brexit landscape. After all, most large cities look hopefully at start-ups and digital “hubs” as economic boons that create exciting jobs and growth. No city wants to be left behind: all rush to be a “centre” of innovation. This tendency, twinned with the fact that modern technology is usually first and most aggressively picked up by urban centres (it’s where the people are, after all) means that cities are where the effects of new technology are felt first, and felt most. Places like London will be the battlegrounds for how technology will shape our world. So what can we expect?

The early skirmishes are already visible in city-level tussles over the “sharing economy”.  Uber and Airbnb are the best-known examples of how digital technologies and smartphones can connect people with resources in fast, effective ways, and both have already changed London and many other cities in myriad ways. (Disclaimer: I use them both.) The “sharing economy” is a misnomer, of course, since people are paying, and companies are taking cuts. But the point is this: GPS plus smartphone is creating entire new ways of doing business. There are plenty of other examples: looking after pets, borrowing cars (RelayRides), daily tasks (Task Rabbit), lending bikes (Liquid), lending money (Lending Club), home wifi (Fon), clothes (Neighborgoods). There’s a flurry of tech startups in London and elsewhere scratching around for the next industry to be “Ubered”.

Sharing economy companies are extremely good for the user, which is one reason they’re so successful. And they can transform cities in exciting and unpredictable ways: Uber rightly boasts of how it has dramatically improved ride-sharing numbers, something cities have struggled with for years. It also provides transportation in places that public transport and private taxis rarely reach. These are not trivial benefits.

But such companies also very proudly disrupt entire industries, sometimes running into legal issues with regulators who aren’t quite sure what rules apply to them. Some “employ” – if that’s the right word – people on flexible self-employed zero-hours contracts rather than long-term fixed contracts with benefits. That works well for some people, but not for others. (In March, the High Court ruled that Uber drivers must pass an English language proficiency test, a decision Uber plans to appeal; several lawsuits are being lined up against Deliveroo.) A recent report from MPs looking into the gig economy expressed concern that the sector was forcing workers into self-employment. This means flexibility, but also fewer legal rights. Given that a decent chunk of London’s workforce is in the service industry, these regulatory fights will soon become a feature rather than a quirk.

The key task for cities embracing technology is to accept that this new “platform capitalism” creates losers as well as winners, and work out who they are. Sometimes it will be members of existing industries that these newcomers disrupt; at others it might be neighbours near to residential short-term letting sites. City governments need to determine how far they are willing to accept disruption in the interests of efficiency and improvement – and to what extent they will let the city’s character change as a result.

If the sharing economy is already transforming the city, blockchain – the latest exciting new thing – has barely started. This is the technology that underpins the crypto-currency bitcoin, and it has techno-wizards purring. Do believe the hype, since it might change the way information is stored (on multiple databases simultaneously), verified (by other people who use the system) and controlled (making centralised editing or control more difficult). Millions of dollars of investment are pouring in to develop blockchain tools for accounting and financial services and to enable the tracking of assets so as to prove ownership. There’s OpenBazaar, a peer-to-peer marketplace that is impossible to shut down, hoping to out-compete Amazon’s cuts and secretive algorithms; a decentralised Uber; decentralised file storage; a decentralised Web domain-name system. The most interesting of these applications are “smart contracts” –  basically lines of code on a blockchain that execute instructions. The German company Slock.it sells locks that are programmed to rent themselves out. When someone books a room, they pay for it in bitcoin (for example), and automatically receive a code that allows entry. When they check out, the lock can automatically order a cleaner, automatically transfer payment to the cleaner, and automatically send leftover funds to the room owner. It’s a whole, functioning company that doesn’t exist, except as a computer programme.

It’s too early to predict what uses this will be put to (imagine trying to guess how the internet would evolve circa 1995), but have no doubt that governments and big business will co-opt blockchain technology and work out applications that enable them to cut costs, increase speed, and improve trustworthiness. Cities must be bold enough to experiment with this technology, and look for ways of using it to improve asset management, administrative transparency, or even payment systems. Every city administration should have at least ten people working on this right now. Blockchain technology is not owned by anyone: it’s an open source approach to information management, and its evolution should not be left solely to the private sector. (The internet, after all, started life as a public project.) Once again, cities need to understand the trendy new devil they are dancing with, and be mindful of the radical roots of this grand blockchain project. It all started with a bunch of crypto-anarchists, who built bitcoin as a way to wrestle control of the money supply from governments. Blockchain’s design is libertarian: no central authority can control it or meddle with it, including democratically elected governments. And immutable records stored online forever, or smart contracts whizzing around, auto-processing, create problems.

While researching my new book Radicals I went to see William Knottenbelt, Director of the Imperial College Centre for Cryptocurrency Research and Engineering. He likes blockchain, and believes it is one of those revolutionary technologies that come along every few decades. But, William told me, if something enters the system by mistake – that someone else owns your house, or your credit card details, or a photo you didn’t want to share – there is no court or police force that can change it. Blockchain technologies will provide all sorts of brilliant possibilities, but underneath, the logic of the system will be a relentless undermining of centralised control.

The major technology on many people’s minds is artificial intelligence, which has jumped quickly from science fiction to reality. Forget rampaging robots: it’s the “machine learning algorithms” (a phrase that no-one had heard of five years ago) that are coming for you. Machine learning essentially means using examples to train software to do things as well as, and in some cases far better than, a human. This has the potential to be extrem­ely disruptive. Machine learning relies on data in order to improve, which creates a powerful feedback loop: feeding in more data makes it smarter, which allows it to get more data, which makes it smarter, which allows it to get more data, and so on forever. Expect some significant leaps in machine learning, and an increasing stream of stories about excellent machines doing jobs better than unreliable, unpredictable humans. It will start off with repetitive tasks (bricklaying, call centre staff, burger flipping), then move onto slightly less-routine, even very skilled work that takes years for a human to master (lorry driving, clerical work). Already, machine learning software can outperform the best doctors at diagnosing illness from CT scans, by running through millions of correct (and thousands of incorrect) examples that real-life doctors have produced over the years.

Whether this machine-learning revolution means fewer jobs, more jobs, or different jobs, no-one can agree on. But one thing is clear: at the very least, it will mean disruption for people, and sometimes for entire industries, with sudden shifts in labour and skills needs. For the cities that embrace all this, the challenge will be how to prepare for such potentially disruptive change, particularly given the glacial pace of reform in education and adult training schemes. The worst-case scenarios – a world of economically useless citizens – are probably exaggerated, but if (and it is a big if) artificial intelligence creates an economy that does not need quite so many jobs, and if it produces growing inequality between successful technology companies and everybody else, there will be costs.

Inequality, for example, creates other social problems – mental health, crime, housing shortages – the costs of which fall disproportionately on cities. It is surely no coincidence that the firmest response to these trends – New York in the case of Airbnb, or Austin, Texas in the case of Uber – has come from city administrations.

Whether they like it or not, cities are now the battleground for both the exciting opportunities and challenges presented by rapid change.

To assume that technology equates to progress is not, of course, a stupid thing to think. In fact, it is an extremely logical thing to think, because it so often has. No: the stupid thing to think is that it always will, and that the benefits will be evenly spread. Automation, AI, sharing platforms, and blockchain will be brilliant for many people, but not everyone. Centres of innovation – those digital hubs – are exciting and vibrant places to live. But they are also disruptive, and disruption comes at a cost. The disruptive power of digital technology is quickening, and city administrations have to quicken with it. They need to develop a corresponding capacity – especially internal know-how – to manage and direct change, otherwise they will be swept away with it. Simply to embrace the technology and let it roll over us would be short-sighted: cities must also face up to the challenges it creates. Embracing “progress” does not mean reneging on the duty to fashion a civic space to live.

This point is very easy to forget, but it must be at the forefront of every decision, because the great power of modern technology is the way it subtly changes norms and expectations. Take, for example, the way in which social media is changing people’s expectations of politics. One London MP told me recently that it is impossible to deal with the thousands of tweets and Facebook posts directed at him – and yet, failure to do so makes his constituents think he’s out of touch. That, too, is part of the philosophy technology wires into us: that technology is change, that change is to be welcomed, and that the arc of history bends towards progress. That is generally true, of course, but rarely without turbulence; and, as cities will soon find out, almost never without some nudging.