Categories Crypto

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So the cryptocurrency industry has basically two products, one which is relatively benign and doesn't have product market fit, and one which is malignant and does. The industry has a weird superposition of understanding this fact and (strategically?) not understanding it.

The benign product is sovereign programmable money, which is historically a niche interest of folks with a relatively clustered set of beliefs about the state, the literary merit of Snow Crash, and the utility of gold to the modern economy.

This product has narrow appeal and, accordingly, is worth about as much as everything else on a 486 sitting in someone's basement is worth.

The other product is investment scams, which have approximately the best product market fit of anything produced by humans. In no age, in no country, in no city, at no level of sophistication do people consistently say "Actually I would prefer not to get money for nothing."

This product needs the exchanges like they need oxygen, because the value of it is directly tied to having payment rails to move real currency into the ecosystem and some jurisdictional and regulatory legerdemain to stay one step ahead of the banhammer.
There’s an old Zen koan that goes, “if you meet the Buddha, kill him.”

In other words, when something is self-verifiable or self-iterating, looking too heavily towards the originator can be a distraction along the path. Results speak for themselves.

Some folks have applied that to Bitcoin as well.

For example, sometimes there are debates about Satoshi Nakamoto’s original intent. Should block sizes be increased to facilitate “e-cash” or should block sizes be kept small for any user to run a node?

This is the type of problem encountered by engineers all the time: trade-offs.

A project can iterate or stay the same depending on what the market says.

Sometimes the successful product ends up being very different than the engineer initially envisioned. Sometimes it’s exactly like what they envisioned.

With Bitcoin, there are developer-vs-developer disputes, and disputes between finance-types and earlier users.

This is similar to natural selection, with “nature” as the market. Some creatures haven’t changed in hundreds of millions of years. Others have changed notably, or transformed into something else entirely.