This is post is a bit of a personal rant. In our recent conversations around the Valley we have noticed a distinct gap between believers and detractors of Bitcoin and all things blockchain. One thing in particular that has stood out is that this divide is somewhat age-related.
Many, but by no means all, of the leading lights of the blockchain world are young, in their 20’s and 30’s. Which if you do the math means that most of them are too young to remember the ’90’s dot.com Bubble. This has resulted in a strain of utopian-thinking from some that strike those of who were working in the 90s as naively familiar. If you scan the blogs and tweets coming out of the blockchain world, you will find people predicting that this new technology will lead to a more just and fair world, with the tyrannies of the ancien regime disrupted by this new decentralized shining light of the blockchain. Somehow blockchain is going to cure many of the ills of the world. If your working life began in the middle of the Great Financial Crisis, you can understand this impulse a bit. However, if your working career began in the middle of the dot.com Bubble, it sounds like history repeating itself.
This was the exact same thing said about the Internet in the 1990’s. And hearing this wrankles those of who remember hearing the same starry-eyed predictions. You would think that the latest headlines around social media, privacy, Internet censorship and all the rest would cause today’s young idealists to think a little more clearly about the amoral nature of all technologies. But of course, the people saying these things were 5 years old when Pets.com and Webvan were somehow democratizing the world. The great irony is of course that many of the entrenched special interests that the blockchain idealists are railing against were once viewed as the disruptors and social saviors of the day.
On the flip side of this, we remain surprised that so many long-time industry participants are so adamantly narrow-minded of the potential for blockchain applications. As we have noted in recent posts, we regularly speak to people who have no interest in blockchain seeing it as just one more over-hyped technology that will soon fade away.
Their arguments tend to break down into two categories: cryptocoins are all scams; and blockchain is just not that useful. In fairness, it is clear that many ICOs have led to some dubious outcomes with the a large number of outright frauds and an even larger number of overhyped token sales. But at this point, can you really argue that Bitcoin is worthless? There is clearly demand for a decentralized digital currency. Bitcoin and by extension many other crypto-assets, are fulfilling a real demand.
The other argument holds that blockchain and de-centralized ledgers are not useful, or are merely highly energy-wasting alternatives to perfectly adequate existing technologies. Here again, we think the critics are over-looking the utility that blockchain can provide. Admittedly, much of what we are seeing today is experimental. As an industry, no one is quite clear yet where blockchain makes sense, but that is a far cry from a blanket indictment that blockchain is useless.
We strongly contend that there are going to be many use cases and industries that can be transformed by application of some form of blockchain. Denying the enthusiasm around blockchain is to deny that there are many very smart people doing very interesting things with blockchain today, and many are just scratching the surface of utility.
So as annoying as some blockchain proponents can be in their claims about the Glory-that-will-be, simply dismissing the whole movement strikes us misguided, if not downright curmudgeonly. So while it is clear that cryptoassets have been heavily over-promoted, and that there is a lot of junk in the system, it is also equally clear that there is important work taking place in the blockchain world today. We think that much of this work will ultimately make important advances.