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Bitcoin Opinion: The Long [Achievable] Road to Adoption

//Bitcoin Opinion: The Long [Achievable] Road to Adoption

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Why is the market crashing? What’s bringing it down? Who’s responsible for this calamity? When will it recover?

I, too, get haunted by all these questions as some of my personal investments are in cryptocurrency. However, because I understand these ups and downs are not only expected but a delicate part of the never-ending cycle of speculation, I try not to worry too much about price. After all, why bother?

So if you’re looking for an alternative topic to all this price talk, today is your lucky day. As for my goal, during the next couple of minutes, it is to try answering the following question:

What can we do to improve cryptocurrency adoption?

Don’t forget the ultimate goal of cryptocurrency is to increase decentralization and the distribution of power among users. As Jimmy Song so eloquently puts it:

“Centralized entities are by their very nature, fragile. Centralized entities can’t afford a mortal failure without jeopardizing everyone else that depends on it.

“Conversely, a decentralized network is by nature anti-fragile: individual failures affect a much smaller group, and thus, a decentralized network can afford a lot more mistakes. These mistakes, in turn, help all the other members of the network to learn what not to do. This, in turn, makes the network stronger.”

Chapter 1 — Fighting Power

-Bad is psychologically stronger than good-

When governments align their strategies to promote growth — to take cuts through taxes, increasing revenues — the strategies they employ imply that any measure deployed will have a sole focus ahead: to make companies more profitable.

Profitability means more jobs, more money, and more taxes.

Except macro analysis rarely takes into account how money is created and spent. Much like the velocity of money is a bad indicator to understand real trade — how is money being spent by people, companies, and governments — nearly all macro-trends do not give a clear view on what is causing certain things, hence, they’re not focused in finding solutions to problems.

I obviously agree that having more data is better than having less data. However, would you say a company is doing well or not based solely on cash flow indicators?

Of course not; it is an important metric, only when aligned with fundamentals.

I could then argue the key metric for growth analysis is not the actual delta, but instead, the optimization of growth for the weakest percentiles. This is a fancy way of saying maximizing wealth redistribution and growth opportunities.

The more we focus on micro trends, based on useful data like where money is being spent, by whom, when, and why, the more we’ll be able to optimize money allocation in-between communities and to measure how effective said money allocation is.

Why The Bashing On Capitalism?

It’s important to comprehend that I don’t dislike capitalism; I just think it needs a more libertarian approach.

Let’s take GDP for example. Why is it that our focus seems to be constantly in growing GDP, instead of maximizing its redistribution? How come are we not looking at the discrepancy between how much GDP is going to the top 1 percent and how much is produced by the other 99 percent?

We need to look at statistics that actually matter if we wish to create a more egalitarian society.

The problem with using incorrect metrics to evaluate the state of an economy is that you’ll only get a one-sided view of the picture. In this case, growth does seem to be the catalyst for promoting development, despite not being the main driver for social equality.

How Come Growth Doesn’t Spread?

Resultado de imagem para wealth concentration gif

There are many reasons one can study, which will shed some light on the matter. My approach is to link growth concentration to corruption, as it seems (to me) the main problem of capitalism.

The reason why people who have more money tend to get richer and people who have less money tend to get poorer (the vicious cycle), is because we do not care so much about redistribution of growth as we care about growth itself. Whoever gets to have more money will always find ways to protect said wealth, meaning the “rational economical man” does exist in some form.

However, this greedy behavior aligned with an opaque and nontransparent political system leads to bad policies being implemented, which promote growth but not growth redistribution.

So how can we aim at fixing this concentration of power problem? Is that even doable?

Chapter 2 — Finding Courage

-The only way to make improvements is by breaking stuff-

Currently, I see multiple paths ahead, some of which will bring positive outcomes to wealth redistribution and others that will have the opposite effect.

If our goals do change in time, and we start properly focusing on finding better ways to give people money (the easiest way to empower everyone), I argue we will eventually try to maximize wealth redistribution.

To me, the key driver will be courage, as our current system must break in order for a new system to take over. Understandably, stepping over decades, maybe centuries, of work and accumulated knowledge isn’t that easy to do.

We need to prove ourselves and that our model is a viable solution.

My Two Cents

  1. Technology is a key driver for change so let’s use it wisely. We can create products which focus on giving more to users, or we can create products which focus on getting more from users. We’ve tried the latter a bunch of times and, in the long-term, we always get to a point where power corrupts values (Facebook, Google).
  2. Money is an extension of us so let’s create more of it. What I’m suggesting is not that central banks start frenetically printing money, but that we find alternative ways to give money to people. Debt is just one way of creating value. Time, work, attention, and trust are just a few things we could start valuing more.
  3. Decentralization only has value if people are at the core. In order to rightfully apply tokens to business models, companies will need to focus on giving value to users. However, value can be granted in different formats, such as governance rights, equity rights, and purchasing rights, among others.

At the end of the day, the most elusive attribute we should be looking for in our crypto-leaders is courage, as they will face many challenges from those who have power and are afraid to lose it. A strong sense of moral values aligned with a courageous mindset is the right mixture for success in fields haunted by ghosts of the past — such as traditional capitalism.

Chapter 3 — Promoting Wisdom

-The news has been getting darker for the past 70 years-

Two important outcomes that centralization has brought are fake news and social media hype. It’s not surprising that large tech companies, ranging from Facebook and LinkedIn, to Amazon and Google, are now under heat for (a) misappropriating user data and for (b) aligning the wrong goals to data analytics.

Of course, we could also go down the path of complicated privacy policies and unreadable terms and conditions, to protect corporations from paying the piper.

The truth is that we are the ones in charge of our data and responsible for our data; meaning, if we do not look for ways to both protect ourselves and to value our data, those two problems won’t likely go away.

The Solution?

We can either wait for regulation to take a more aggressive stance, which seems to be an ineffective way of creating trust between users and platforms, or we can switch to decentralized alternatives.

At the moment, it’s easier said than done. DApps are still difficult to use, user-interfaces aren’t the best one could have hoped for and, generally speaking, blockchain-enabled technology is still primal and not so user-friendly. Just think the pain it would be each time you wanted to take some action in a given platform, a MetaMask pop-up would appear asking you to confirm some transaction.

Not a good idea.

What we need to do is to fix the issues brought by centralization:

(a) A mesh of different decentralized, open, permissionless and transparent base-layer protocols enabling easy-to-deploy infrastructure for applications. Users would always own their data (through transactions), not giving the underlying application any rights to your data, without due payment.

(b) The development and incorporation of private transactions, so that users can share data with providers without compromising their identities. By allowing for a higher degree of anonymity, it’s possible users can opt-in and out of certain platforms, without compromising any data which might have been shared among providers.

Conclusion

Currently, we lack a healthy system of incentives and rewards, which can definitely be the catalyst we’re looking for to promote a better redistribution of wealth.

Projects in the crypto-space need to be aware that it’s up to them to undertake the difficult assignment of changing economic paradigms, by developing new innovative ways to create and distribute value amongst token holders.

In the long-term, we’ll either walk towards a decentralized future, where users are the rightful owners of their data and are incentivized to make money out of it, or we can choose a different path and accept the institutionalization of technological corporations, as gatekeepers of information and managers of our data.

The clock is ticking.

The die are cast.

Hopeful about the future, are you?

Disclaimer: this article shouldn’t be taken as financial advisement; it represents my personal opinion and should not be attributed to CCN. I have savings invested in cryptocurrency so take whatever I write with a grain of salt. Do not invest what you cannot afford to lose and always read as much as possible about a project before investing.

2018-10-29T08:16:10+00:00October 29th, 2018|Categories: Bitcoin mining|Tags: |

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