Is Crypto Bullshit?

Presently, the dominant blockchain/Web 3.0 application is decentralized finance, but I think it’s easier to see the value of where things are heading, and to allay worries about hype cycles, pyramid schemes and speculative bubbles, if we look past the purely financial stuff. Once you start to dig into some of the applications that venture capitalis... See more

The economic surplus generated by this kind of network is necessarily distributed to the community of miners, stakers, and users because that’s what brings them into existence, keeps them going and lends them value. The diffusion of economic surplus is part of the basic architecture of the system. Market structure, distributive principles, and defe... See more

Replicating everything AWS or Azure or Google Cloud can do on a blockchain isn’t redundant because the decentralized collective “ownership” and governance of blockchain networks supports security, privacy, stability, and scalability features that Web 2.0 applications running on centralized corporate clouds can’t replicate because they are centraliz... See more

In particular, I find the diffuse capitalization, ownership, and control of these kinds of networks extremely appealing. It’s this — not stupid ape avatars or hype about Bitcoin as “digital gold” — that gets me charged up about crypto/blockchain stuff. It’s also why think we need to be careful about regulation that could strangle the baby in the cr... See more

More fundamentally, if money is the end point, is it truly a game or just a gamified micro-economy where “farming crypto” is a core game mechanic?

Indeed, within my social/intellectual circles, the dominant view seems to be that Bitcoin amounts to climate terrorism in the service of tulip mania, that NFTs are a pyramid scheme, and the main crypto use case is crime-enabling asset concealment and money laundering.

This is when it really started to click to me. I’m not actually interested in fighting and breeding cute virtual creatures. But experiencing an in-game economy built to integrate with the real economy was eye-opening. Felix plays Roblox and loves to customize his avatar, collect pets, and special items his dude can carry around. He’d love to be abl... See more

The proliferation of crypto guilds, communities and esports leagues around these earn-first games are evidence that earning opportunities are key to these games. Guilds like YGG and Merit Circle (which just raised $100m+) only exist and are trading at large premiums because of the earning opportunities that are offered within the earn-first games t... See more

Think about who owns the Bitcoin or Ethereum networks. Nobody does. Nobody owns them. These networks are made up of many thousands of machines whose computational power has been allocated to the network because the network’s constitutive code pays the people who own the machines to keep them connected and churning away — and on super-reliable, code... See more