Surprisingly, I’m Quite Optimistic About the Future

by Michael Krieger, Liberty Blitzkrieg:

To summarize, in just the last few years the world has invented a way to create software services that have no central operator. These services are called decentralized applications and they are enabled with crypto assets that incentivize entities on the internet to contribute resources — processing, storage, computing — necessary for the service to function.

It’s worth pausing to acknowledge that this is kind of miraculous. With just the internet, an open protocol, and a new kind of asset, we can instantiate networks that dynamically assemble the resources necessary to provide many kinds of services.

– From Adam Ludwin’s: A Letter to Jamie Dimon

I’m actually pretty optimistic about the future. I know some of you might be surprised to hear that, but it’s true. This might not be the case if I had only five years left on the planet, but assuming I’m fortunate enough to stay healthy for another few decades, I think the world will be a much better place when I leave it than when I came in.

The simple fact of the matter is this. For things to get substantially better from any situation, it’s always easier to start from a pretty bad place. When I write articles describing the U.S. economy as a rent-seeking, oligarch controlled swindle, I don’t do this to fill you with a sense of insurmountable dread. Rather, the purpose of those posts is to shake as many people as possible out of their slumber. There’s simply no way we can come up with appropriate and conscious solutions to our problems unless we can identify the various scams that govern so much of life around us.

The most lucrative scams are simultaneously extremely bold and well hidden. As such, there’s no greater scam on earth than the scam of the monetary system. A system where a small group of unelected technocrats (central bankers) are given power to create and distribute money at their discretion. The power that these people wielded during the financial crisis was historic in nature and dastardly in its results. Essentially, the monetary system was used as a weapon to bailout and further enrich those already entrenched in positions of power and wealth at the expense of everyone else. There’s simply no way Donald Trump would be President today had it not been for the extraordinarily lopsided “recovery,” which was a direct result of government’s extremely unethical and arguably criminal response to the financial crisis.

 

Having worked in the financial industry for a decade, I immediately saw the swindle for what it was. As such, I could no longer stomach working on Wall Street and resigned from my job in January 2010. The next couple of years were dark ones for me. I saw what had happened, and I knew the kind of society that was being institutionalized as a result of bailing out and leaving some of the most vile, predatory people in U.S. society at the pinnacles of power. I felt an overwhelming sense of dread and couldn’t see a way out. Then I learned about Bitcoin.

I don’t want to overly repeat stuff I’ve already written, but Bitcoin provided me with a sense of optimism I hadn’t felt in years. I saw that some genius had created a monetary escape route for humanity, and that we would now have the technology to start creating the world of the future. A world increasingly characterized by decentralization and grassroots action, versus centralization and top down command and control. It’s been five years since I started writing about Bitcoin, and I’m more encouraged than ever. Not only has Bitcoin captured the imagination of the world, but decentralized applications are taking off in all sorts of different ways.

To understand more about what I mean, I strongly suggest reading an article published by Adam Ludwin titled, A Letter to Jamie Dimon. Below are just a few select excerpts from this excellent piece:

To summarize, in just the last few years the world has invented a way to create software services that have no central operator. These services are called decentralized applications and they are enabled with crypto assets that incentivize entities on the internet to contribute resources — processing, storage, computing — necessary for the service to function.

It’s worth pausing to acknowledge that this is kind of miraculous. With just the internet, an open protocol, and a new kind of asset, we can instantiate networks that dynamically assemble the resources necessary to provide many kinds of services…

Centralized applications beat the pants off decentralized applications on virtually every dimension.

EXCEPT FOR ONE DIMENSION.

And not only are decentralized applications better at this one thing, they are the only way we can achieve it.

What am I referring to?

Censorship resistance.

This is where we come to the elusive signal in the noise.

Censorship resistance means that access to decentralized applications is open and unfettered. Transactions on these services are unstoppable…

Given how different they are from the app models we know and love, will anyone ever really use decentralized applications? Will they become a critical part of the economy? It’s hard to predict because it depends in part on the technology’s evolution but far more on society’s reaction to it.

For example: until relatively recently, encrypted messaging was only used by hackers, spies, and paranoids. That didn’t seem to be changing. Until it did. Post-Snowden and post-Trump, everyone from Silicon Valley to the Acela corridor seems to be on either Signal or Telegram. WhatsApp is end-to-end encrypted. The press solicit tips through SecureDrop. Yes, the technology got a little better and easier to use. But it is mainly changes in society that are driving adoption.

In other words, we grew up in the rainforest, but sometimes things change and it helps to know how to adapt to other environments.

And this is the basic argument that the smart money is making on crypto assets and decentralized applications: that it’s simply too early to say anything. That it is a profound change. That, should one or more of these decentralized applications actually become an integral part of the world, their underlying crypto assets will be extremely valuable. So might as well start placing bets now and see how it goes. Don’t get to hung up on whether we see the killer apps yet.

That’s not a bad argument and I tend to agree.

The above is just a small fraction the post, but packs a ton of important information. What Adam is saying is that with the advent of Bitcoin and other decentralized applications, we now have an opt-out to centralization (and hence censorship) in some very important aspects of life, with the most significant to-date being with respect to a hopelessly corrupt monetary system.

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