When I first discovered Bitcoin in 2011, I believed it would be widely recognized as an important and valuable technology within a few years. Now, nearly nine years later, it's almost painful to look back and realize how naive I was.
I'd like to briefly reflect on what I wanted to happen, what actually happened, and what I hope the future holds for open blockchains and cryptonetworks.
Early Dreams, Harsh Reality
In 2011, I wanted to see people questioning the existing monetary system managed by central banks and thinking deeply about the nature of money. I thought people would openly embrace the concept of "being your own bank," and gradually reduce the market power of commercial and central banking leviathans by "opting out" and using Bitcoin.
Instead, most people scoffed and ridiculed the experiment. When speculators inflated the crypto bubble to absurd heights in 2017, people with no interest in the technology or philosophizing about money succumbed to dreams of getting rich quick. Crowd madness drove people to take risky gambles, and newcomers got badly burned when the bubble popped. Misconceptions about Bitcoin and blockchains spread like wildfire.
When the IRS declared Bitcoin to be "property", they created a tax reporting nightmare for anyone who wanted to use cryptocurrencies as currencies. Corporations reverse-engineered open blockchains into more efficient and slightly less centralized private databases, while authoritarian governments twisted them into closed tools that will enable more efficient control and surveillance.
High Hopes, Existential Fears
I still believe open blockchains can help improve our decaying social institutions by making them more robust.
Specifically, Bitcoin and Ethereum can:
- Transform the global economy by providing more competition in the market for currencies.
- Create new saving and spending options for those who prefer using disinflationary currencies or monetary policy set by transparent "decentralized" digital banks.
- Help give the billions of unbanked individuals access to basic financial services while increasing the efficiency and inclusivity of the global financial system.
- Serve as the foundation for a new class of decentralized applications and decentralized organizations, giving users greater control over their data and digital identities and improving the ability of digital organizations to coordinate.
- Help those working on Decentralized Artificial Intelligence and ethical AI ensure we live in a world where essential AI systems aren't controlled by major governments and a handful of large corporations.
However, I fear open blockchains will suffer the same fate as the Web, and technically decentralized base protocols will support application layers dominated by oligopolies. I'm afraid governments will crush the technology's potential to improve lives with restrictive regulations.
Embracing Evolution
Open blockchains are no panacea, they’re just tools that can help improve the human condition if used wisely. It's been frustrating to recognize that the barriers to beneficial mass adoption were larger than I ever imagined, and humbling to grasp the fact that technologies are simply tools. Any innovation that possesses the potential to help billions simultaneously possesses the potential to harm them.
It's hard to change individual habits, and exponentially more difficult to consciously direct the evolution of complex social systems. If I could speak with "2011 Shingai", starry-eyed with dreams of peaceful revolution sparked by mass adoption of Bitcoin, I would urge him to exercise patience and caution and recognize that any long-term benefits from cryptonetworks must be evolutionary, not revolutionary.
These recent posts from Coinbase CEO Brian Armstrong provide a great summary of key developments in crypto over the past decade and some well-informed predictions for the next one.
