The Blockchain Disruption

Crypto will disrupt tech, just like tech disrupted everything else. There is overlap, but crypto is really a different sector down to the base level of how organizations are formed, monetized, and exited. Like the cloud and mobile transitions, it will take decades to fully play out.

Living through this incredible bottom-up revolution shows what one person with a computer can do. Satoshi Nakamoto changed the world’s financial system, established a new digital reserve currency, and shifted the thinking of the Davos elite with just a keyboard and the right ideas.

I would be far more bearish on the future if Bitcoin didn’t exist.

The terms "emoney" and "digital currency" are vastly better than "cryptocurrency" for quickly conveying what crypto is about. Just as email took the stamp away from mail, emoney holds the promise of eliminating the transaction fee.

If the internet was programmable communication, crypto is programmable money. Before the internet, you needed a deal with a telecom company to deploy information-transferring code. Before Bitcoin, you needed a deal with a bank to deploy value-transferring code.

New types of transactions are enabled by cryptocurrency: the very small, the very large, the very fast, the very automated, and/or the very international.

Those saying, “Crypto is just another asset class” sound like those who said, “The internet is just another media outlet.” They didn’t understand programmability, permissionlessness, or peer-to-peer, and they overestimated the robustness of legacy institutions. History repeats with crypto.

Crypto is more than an asset class because it transforms the custody, trading, issuance, governance, and programmability of anything scarce. It’s a new financial system, not just some ticker symbols.

The internet subsumed TV, radio, newspapers, movies, and created new kinds of media. Crypto likewise will subsume stocks, bonds, commodities, and create new kinds of assets.

Crypto is about digital property rights. By default, you should own your social media account. A platform that can seize it without due process is like a bank that can seize your money at will. Blockchains today protect you against the banks and tomorrow will protect you against social media platforms.

Blockchains provide the technical foundation for a new digital theory of property rights.

People will go from being internet influencers to crypto creators. The difference is crypto creators have property rights on their content. If you don't own private keys to something, you don't really own it. Like your social media account—you have conditional access to something that could get taken away.

When Trump got deplatformed from Twitter, whatever else you think about that, future historians will look at that as a moment “the most powerful man in the world wasn't even the most powerful man in his own country.” It showed that your social media account is not yours.

To truly be a creator, you have to be a crypto creator, not an internet influencer. The gap between them is the gap of digital property rights. And that gap is huge.

This is a huge unlock for billions of people on social media. Three billion people are on Facebook, yet nobody controls any digital property rights. Your social media is not just your tweets or your posts—it is your relationship to your friends and followers. It is your ability to earn money without YouTube taking a big cut of the revenue, or just turning it off. Why should this gigantic corporation be able to silence you or seize your assets at will?

It might take ten to twenty years, but as blockchains scale, every centralized service can become a decentralized protocol. Times have changed, and the economic terms of the agreement are changing. People are realizing they're not in control and they’re not getting a cut.

Crypto is a spinal transplant for the tech industry.

On disk → Online → On-chain. On-chain is like the third level of deployment. Files that only you care about stay on your local disk. Files that are important to others get put online. And files that are *really* important to others will get put on the blockchain.

When you put information online, you get distribution, sharing, collaboration, etc. When you put it on-chain, you get immutability, verifiability, monetization, etc. On-chain is not suitable for everything, just like you don’t put everything online. Putting something on-chain is a stronger version of putting it online. It lessens the impacts of link rot, stealth editing, downtime, format obsolescence, firewalls, and many related issues.

Blockchains also enable distributed consensus on questions like: Who wrote this? Who signed this? When did they sign it? What did they sign?

Over the next decade, financiers and engineers will use on-chain data more and more, because it’s the input to every smart contract…which is the basis for every investment decision in the cryptoeconomy…which becomes an ever larger share of the global economy. Because all value becomes digital, the entire economy will eventually become the cryptoeconomy.

The last era was big data. The next era is verifiable data.