The End of Crypto-Fanaticism

Why Blockchain is not going to be the next big thing?

I've been following the crypto movement closely and have wondered how my view of it might change, but I remain highly skeptical for multiple reasons. I could mention Ray Dillinger, one of the main contributors behind Bitcoin, who wrote an open letter explaining how the project has completely deviated from its intended purpose, or more recently, the reserve bank of India's assessment of crypto-currencies which considered them to be: “designed to bypass the regulated financial system” and “not amenable to definition as a currency, asset or commodity”, concluding that banning the entire ecosystem in India might be the most reasonable option.

But I do not intend to debunk or argue why X might be better than Y from a technical standpoint, as many people have already done so on many levels. Instead, I want to talk about the social movement behind crypto-currencies and why I find it scarier than inspiring.

A social movement can be defined as “a loosely organized effort by a large group of people to achieve a particular goal, typically a social or political one”, in the context of Bitcoin, the system has been introduced by crypto-anarchists/libertarians aligned with the ideology that money should be separated from the state. At first, it was primarily used by people wishing to circumvent government control and quickly became associated with criminal money as it was the preferred means of payment for darknet markets, until more recently, a highly speculative investment. It's very complicated to entirely grasp the crypto movement in a specific definition, as some may refer to fancy words such as “crypto bro” or “crypto-anarchist” to qualify people in crypto-currencies and, although the reality is more nuanced, I would define the crypto movement as a group of people against financial institutions.

Similarly, the Counterculture of the 1960s was an anti-establishment movement that also had its own “weapon” or “tool” to fight existing institutions, psychedelics... They became mainstream when substances such as LSD and psilocybin (magic mushrooms) were popularized by intellectual figures like Timothy Leary, a clinical psychologist at Harvard, who became well-known for his catchphrase “Turn on, tune in, drop out”, urging people to embrace cultural changes through the uses of mind-altering substances. Soon after, he was followed by Terence McKenna, a pioneering ethnobotanist and psychonaut, who had a significant influence on the counterculture movement by advocating responsible use of psychedelics while encouraging people to regain their sovereignty over societal conditioning.

“Psychedelics are illegal not because a loving government is concerned that you may jump out of a third story window. Psychedelics are illegal because they dissolve opinion structures and culturally laid down models of behaviour and information processing. They open you up to the possibility that everything you know is wrong.” – Terrence McKenna

In 1968, LSD was designated as a Schedule 1 substance, rendering its possession and use illegal across the United States, followed by the prohibition of psilocybin and other substances. Later, the counterculture movement began to lose popularity and finally came to an end after the resignation of Richard Nixon in 1974 and, like many “Anti” movements, failed or at least partially achieved its goal. Nevertheless, this does not necessarily mean that it did not have an impact on subsequent generations, as many artists were deeply influenced by the Hippie movement, (now called “New Age”). A few decades later, psychedelics gained popularity after being reauthorized in scientific research for medical purposes in the 1990s. Substances like MDMA and psilocybin appear to be more effective than traditional medications in treating mental illness in certain cases and have recently been recognized as “breakthrough therapies” by the FDA.

I am grateful that the counterculture movement existed, it gave hope for a better world and spawned a groundbreaking art scene, including “The Dark Side of the Moon” which indirectly introduced me to LSD in my early 20s. I would find it disingenuous to pretend that psychedelics haven't changed my way of thinking or my personality, but I remain lucid about the fact that they are dangerous and that, despite their potential therapeutic effects, they stay massively used recreationally by a minority of people who might benefit from them, or not. What is almost certain, is their future application in medical settings to treat depression or PTSD while being prescribed under the supervision of trained professionals and less likely by a pseudo-psychologist at Burning Man.

Unsurprisingly, I think that the crypto movement is relatively similar to the counterculture as it seems to follow the same patterns, the main difference lies in how they operate. Instead of social gathering, most interactions are virtual, as well as for the artistic scene, while psychedelics have been replaced by Blockchain, a technology that would disrupt the banking system, allowing citizens to reclaim their financial sovereignty by short-circuiting existing institutions. As expected, some intellectual figures have already seized the movement, applying sophisticated rhetoric to advocate crypto-currencies as a “one-size-fits-all” solution that would liberate us from inflation and future crises while polarizing people against the monetary authority, and ultimately, turning them into crypto-currency holders.

As I write this, Bitcoin is approaching its 15th anniversary, followed by thousands of alternative crypto-currencies culminating in a market capitalization of $2 trillion. Only, after all this time, why haven't most western countries taken any action against one of their “supposed” biggest financial threats? Where are the tantalizing promises of crypto-gurus? Indeed, crypto-currencies are still around, growing steadily, while most governments have not yet banned them, simply because they don't need to. They fully understand that it's virtually impossible to prevent a population from using cryptos as the fight against illegal downloading was pointless. Besides, making something illegal often results in people being drawn to it even more, as it lends credence to its cause. Instead, they opted for a different strategy, regulation, requiring crypto-currency exchanges to comply with new rules, making them no different from gambling platforms and, therefore, locking them into a sandbox. As a result, the crypto-sphere has come closer to being a parody of itself than to anything revolutionary, to the point of being advertised during the Super Bowl, broadcasting misleading slogans such as “Don’t be like Larry. Don’t miss out on the next big thing” or “I can’t tell you everything, but if you want to make history, you gotta call your own shots”. The whole movement seems so far removed from the original manifesto that it is slowly morphing into an endless hole, abducting people desperately seeking to be part of “something”, but what exactly?