Thoughts on cryptocurrency as a technology
As the market crashes, I'm scattering a few relatively uninformed thoughts on cryptocurrency. Not much here is new. Would love to hear your perspective.
- The worth of crypto/blockchain as a technology is somewhat unrelated to its value as a speculative asset. When Bitcoin goes up it gets more adoption, which does help the technology, but what is more exciting than a few people getting really rich is the possibility of banking the unbanked, and technologies we can't even anticipate yet.
- That being said, I think crypto long-term is a buy. I think we will see a drop to $5k or lower, then slow growth. In the long term this is a technology that is exciting.
- Ultimately the reason many were excited about crypto is because it challenges governments, so it's not surprising that we are seeing a lot of regulatory action. I believe that coins which work well alongside governments will ultimately be supported, and coins which don't will see a lot of struggle, perhaps leading to ultimate dominance.
- I hope that Bitcoin isn't the coin that wins out. Its governance structure is messed up, a few Chinese miners have outsized power, it's slow and expensive, and bad for the environment (until some changes are made, which may or may not happen.) There are other coins that purport to solve some or all of these things.
- New coin looks a lot like old coin. Oligarchy seems to be the natural state of things and promises of decentralization have been overblown. Ultimately, people with power and capital have been able to control and manipulate the networks. While I believe it may be possible to create a technology that subverts this, it's not on the horizon. I am also curious / concerned about how users will hold those in power accountable when these people are semi-anonymous and on the other side of the world. With governments we have voting/democracy/threat of violence, and for this reason it makes a lot of sense to me to correlate power and location.
Will we see crypto unions? Crypto cabals?
- The truly exciting uses of blockchain are for running software and AI. Once there are stable platforms that allow stable non-global blockchains connected to global blockchains, we'll see an explosion of truly useful blockchain tech. (Example: you can't run machine learning on the Ethereum network, but eventually you'll have something like AWS on which you can.)
- That being said, there is something truly terrifying about a world computer that you can't turn off. AI built on top of something like Ethereum can't be shut off unless the entire network agrees to do so. Blockchain is the perfect platform on which to build the singularity."