And here’s where cryptocurrencies make their unlikely appearance. It feels strange discussing crypto in an article about trust because, on the surface, crypto is maybe the least trustworthy thing on the planet right now.
Crypto has become a bit of an obsession of mine for the past few years, not because I think I’m going to get rich or destroy the US government or something, but because crypto lies at the intersection of the most fundamental social questions—questions of trust.
It’s almost impossible to find a level-headed discussion of crypto anywhere on the internet today. Supporters sound like a religious cult heralding the coming of an imminent utopia. Critics are in hysterics over exaggerated claims involving the environment, black markets, and inequality. And, of course, you have the usual hate that every new technology attracts—“it’s a scam,” “it doesn’t even work,” “it’s a fad and nobody will use it in 10 years,”—the exact same criticisms leveled at the internet in the 90s, television in the 50s, telephones in the 19th century, and so and so on.
People see crypto and interpret it based on what they already believe to be true about the world, rather than approaching it as something that could potentially change what is true about the world.
I believe crypto is so polarizing and messy because it is attempting to innovate the most foundational aspect of human civilization: trust. And because trust is so fundamental to everything we do, that makes crypto both insanely exciting and insanely scary.
Fundamentally, the technology undergirding crypto is an attempt to build a computational network that, through clever uses of cryptography and decentralization, is immutable—i.e., it can never be hacked, can never be corrupted, can never be lost or broken.
That sounds technical and highly abstract, but the implications are incredible.
Today, if you need a loan, you go into a bank. You sit with a loan officer. You talk and maybe hand them your credit report, your proof of employment, your tax returns, a utility bill or something to prove all the stuff you say about yourself is actually true—that you are trustworthy.
This lone banker is essentially verifying your trustworthiness on behalf of her institution. And to do so, she relies on dozens of other institutions who have verified your trustworthiness, mostly because you’ve proven yourself trustworthy through other institutions, such as school, employment, lack of debt, etc.
But these bankers, as well as the reports they collect from the credit agencies—or your landlord, your employer, etc., etc.—are just middlemen in a game of trust. They are there to verify that you’re not a bad actor. And there are millions of people in the world whose entire jobs are to simply do this: verify trustworthiness. Insurance companies, banks, legal firms, universities, regulatory agencies, and government programs have massive office buildings full of nothing but people doing this trustworthy verification thing, all day every day.
And they do this because we have no other better way to do it. And because these groups of thousands of people are required to do this, the process is corruptible because it is human.
The way Uber automated away taxi drivers, crypto will automate away millions of these trust verifiers. Maybe you think that’s an amazing thing. Maybe you think it’s a horrible thing. But you can’t deny—it’s a really fucking big thing.
And you can shake your fist and make pleas about job security and income inequality or whatever, but at the end of the day, you and I and everyone else will love it and use it for the same reason we love and use Uber… because it makes our lives a hundred times easier.
Because the current customer experience of dealing with human-led institutions to constantly verify trust is a never-ending nightmare. Getting that loan requires weeks of calls, meetings, and submissions of hundreds of pages of paperwork, all containing very personal and sensitive information.
Because institutions are human and humans are always corruptible and weak. All it takes is one pissed off guy at the DMV to literally prevent you from being able to legally drive. All it takes is one asshole banker on a power trip to fuck up your ability to buy a home.
Because the special interest relationships between big banks, insurance companies, legal firms, and government are both inevitable and corrosive.
Because, ultimately, privacy and freedom of expression do matter. A lot.
That is why I believe crypto is inevitable.
Inevitable. But messy…
To rebuild the world’s network of institutions from the ground up, you’re probably going to have to make all of the mistakes institutions have made over civilization’s 5,000-year history to get there. Venture capitalists often say that crypto is like “speed-running start-ups.” I say it’s more than that. It’s speed-running institutional history.
Crypto is market-testing hundreds of different types of governance models, security protocols, capitalization allocations, wealth redistribution, brand-building. What happened in 100 years in the real world happens in a couple months in the crypto world. And eventually, it will catch up. The governance systems will be better, faster, more reliable, more secure, and censorship-proof. But part of that market-testing is subjecting itself to hundreds of hacks, ponzis, rug pulls, saboteurs, scam artists, rip-offs, and dumb dog coins.
But they need to happen. Each one is an experiment. And each experiment’s failure moves the technology forward at a blistering pace.
My brain enjoys volatility and chaos. It also enjoys technology and money. Therefore, my brain enjoys crypto. I own a bunch and have for many years. But I also understand why many wouldn’t and many don’t. I also understand those who are terrified of its potential. After all, in order to automate and upgrade trust-verifying institutions, you must rebuild and/or replace those institutions. And those institutions are unlikely to go quietly.
If you’re a fellow degen like I am, I’m experimenting in the NFT space with a fractionalized launch of one of my books on the Ethereum blockchain. It will be the first of its kind and a way to share creative power with my fans and readers. If you want to learn more or get on the early-bird list to join in, learn more about the project here.
If you hate all of this shit and think I’m brainwashed or something, that’s cool too. But, guess what? I don’t give a fuck. I know, shocker. Hopefully, you at least found my musings interesting or thought-provoking.