Posted on 11/29/2015 6:33:21 PM PST by Another Post-American
A week ago I was in Belgrade watching a panel on "blockchain."
The makeup of the panel was typical: a young, plugged-in VC, an older banker guy and a crypto-anarchistic dude in a T-shirt. It was like watching a movie called "Bitcoin is Good And Bad" for the 50th time. I knew what was happening but I couldn't look away.
The panel started normally - VC guy said he liked the blockchain specifically but was iffy about those bitcoins, the older gentleman said bitcoin was bad, but then the anarchist dude was quiet. He let the banker talk. The banker said that bitcoin was untraceable. It was a fad. The crypto guy let him talk. bitcoin was a tulip bulb, said the old dude. It would never work, he clamored.
And the anarchist stayed quiet. Then the old dude was done.
The anarchist calmly explained what the future of bitcoin and cryptocurrencies held. He made cogent points that he had practiced many times. While the banker chortled at his own jokes, the VC talked about the blockchain and the audience grunted.
The anarchist won the discussion through reasoned argument.
'Bitcoin in a suit'
This is the face of bitcoin discourse in late 2015. It's a calm discussion where the craziest people in the room are the ones who are against bitcoin. We've won.
I asked the anarchist, Aaron Koenig, what he was thinking on stage. He said:
"I've been through this many times."
He was used to that line of questioning. He knew how to handle it and how to ignore it. In fact, it's the folks who don't understand cryptocurrency and the folks who don't understand bitcoin that seem the craziest these days. It's a fascinating flip.
We're basically seeing the dawn of bitcoin in a suit.
Just as Red Hat turned Linux into something an IT department could use to replace Microsoft, the new bitcoin users are turning crypto into something that a person can use to replace a bank.
The accretions of a dozen decades of banking tradition have convinced those inside the big institutions that their way is right and will be right forever. Those outside, the scrabbling sea monsters trying to figure out a new way to walk on land, know that isn't true.
There's an old quote I love, written by Wilhelm Stekel but made famous by Holden Caulfield in Catcher In The Rye.
"The mark of the immature man is that he wants to die nobly for a cause," Stekel said. "While the mark of the mature man is that he wants to live humbly for one."
The true bitcoin believer needs to take this to heart. We've already won. We've moved past the era of raving lunatics howling in the wilderness about digital gold and the end of governments.
We're in a position to make real, meaningful change in the world and to do that we need to listen more than we speak.
Malaise among investors
In my time as a bitcoin entrepreneur, I've seen a certain deep malaise rising in the investor class.
They've met too many wide-eyed Jeremiahs fresh from the desert with a plan to put our DNA on the blockchain.
They've seen investments crash quicker than HSBC after another scandal. They've been burned by guys who write banking code in PHP and host it on public servers. Now they're doing technical diligence and they're offering objections to every claim.
But there's one thing to remember in every investment scenario: objections are a buying signal. Say what you want about short-sighted folks stuck in the past: investors know that something is brewing.
In 1995, you'd have been hard-pressed to convince anyone that email was anything cooler than a way for scientists to tell each other where to point a giant telescope in Peru.
Then came Hotmail and the utility of email became obvious. The same happens with any previously complex technology: the objections die when the technology becomes part of the white noise of commerce, communication or reproduction.
Embedded in banks
So let them howl. Let hem hoot. Let them say you're doing something wrong. None of their objections are real.
They're simply trying to raise your hackles, to get you to react, to get you to fight. But the fight is over. Bitcoin is nearly embedded in every bank (they call it "blockchain research" in the banks but it's really two bitcoin people sitting in cubicles sending each other news articles from CoinDesk) and there are investors who are ready to invest in actual product.
That's right: pie in the sky ideas aren't going to cut it. You have to build. But when you build, they will come.
As we move forward we're all going to find new problems to solve and new business to build. It's inevitable. Eighteen years ago I remember sitting in an airplane listening to a guy who needed millions of dollars for Sun Servers to launch a website for a movie theatre.
Now, thanks to Linux and a bunch of work on the front end, that movie theatre can use Squarespace. It will get easier to use the Internet of Money just as it got easier to use the Internet itself.
It takes time and it takes quiet concentration. And, eventually, the people we remember as being so vocal about the dismal future of bitcoin will be the ones who use it the most.
Disclaimer: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, CoinDesk.
*Ping*
“a young, plugged-in VC”
Viet Cong?
Venture Capitalist.
I’m waiting for true digital anonymity. It will be the end of the nation state.
Not when ultimately nation states control the networks required to conduct a digital economy.
Yeah a lot of those VC probably did become venture capitalists. :-)
yep
Bit coin will never be anything. Because, countries can’t exist if they don’t control the currency. Bit coin people always argue that bitcoin has more merits than the dollar and other currencies. But that does not matter. Whether it has merit or not is not important.
When there is liquidity and widely accepted value, bitcoin will be something. But just like gold, if that were to happen, countries will just buy up most of the bitcoins. Then bitcoins will be no different than dollars.
But the important point is that there is no reason why one currency is truer than another. The question is, which currency do people believe in. The answer is, the currency they can use. If they can get paid in a currency and then walk to a store and buy something, pay rent, save it in a bank then its valuable. If not, at best its a new form of S&H green stamps.
Ping.
Here’s a little joke that those who have studied monetary history, monetary policy, and especially the history of America’s very own central bank known as the Federal Reserve may appreciate:
What’s worse than a fiat currency?
A fiat currency that is digitally maintained and used so that whoever controls the digital medium can shut down the currency with the press of a button.
Fun stuff.
How you gonna keep them on the tax plantation once they’ve seen the block chain?
For every force there is an opposing force. It’ll take awhile for the block chsin economy to take hold.
...and unlimited seigniorage to rebuild Babylon.
The problem with buying up all of crypto currency is what do you do when they multiply? Today it’s bitcoin. Tomorrow it’s doguecoin, the day after that it’s litecoin, etc.
Besides, the more they buy up, the higher the price goes up on the remainder, to infinity. I’ve been HODLing my bitcoin and intend to do so no matter what kind of price spike it may see, so no government can take my bitcoin (legally).
As someone pointed out on bitcointalk, you could run the entire world’s economy on one bitcoin, since we can just soft-fork the current divisibility of bitcoin from 8 decimal places to whatever was needed.
And you’re right, if some government did try to corner the market on bitcoin, we’d all just switch to litecoin or dogecoin or dash or piggycoin or the hundreds of others.
Money is simply an efficient mechanism for barter between parties. If people put their faith in fractional reserve banking systems over-leveraged to the hilt with a small percentage backing it and the promises that governments will backstop any crashes, then crypto-currencies are not that much different. It just annoys the banking class that they don’t get to control it and lose their first mover advantage on creating debt/wealth by adding electronic zeroes.
For the skeptics in the crowd, the crypto-currencies are right out of the sci-fi books and are here to stay. Anytime a group of people decide to place their faith in one for more efficient transactions, they now know how to do it. It will be like stamping out pirating on the internet. The best bet is to embrace it and regulate it.
On a related note, for the Freepers that are donating computer time doing the “distributed computing” science/medicine projects “Folding@Home” and “BOINC”, check out the cryptocurrencies “Gridcoin”, “CUREcoin” and “FoldingCoin”. Get some reimbursement for your electric bill that was increased by “Folding” or “BOINC’ing”!! ;-)
http://www.gridcoin.us
https://www.curecoin.net
http://foldingcoin.net
I have done all three...if you have any questions. Gridcoin seems like the most profitable option right now (price per coin has increased steadily lately).
https://coinmarketcap.com/currencies/gridcoin/
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