I'm done watching the crypto scene

I’ve been fascinated by the crypto world for years. It started way back when I first heard of Bitcoin around 2009. It was a really interesting idea. A distributed append-only ledger that anyone could write to. I hadn’t heard of anything quite like it.

I couldn’t really figure out what it was good for. It was slow, expensive, and hard to correct mistakes. I heard lots of arguments for it, but none of them were convincing to me.

• You can instantly send money anywhere in the world!
  • But you still have to deal with exchanging it for local currency.
  • And the instantaneous nature means there isn’t a way to reverse transactions so it’s going to become a magnet for fraud.
• You can have privacy and anonymity! Governments won’t be able to stop you!
  • Except that every transaction is public so anonymity only lasts as long as you can avoid having any identifying information tied to your wallet address.
  • And you’ll be identified as soon as you try to convert to fiat currency.
• It’s immune to government censorship!
  • Except we mostly have that censorship for good crime-prevention reasons!
  • There’s still the issue of turning it into real currency.
• It’ll become a way to give everyone a path to global currency exchange!
  • Except it relies heavily on electronics and internet access which can be censored.

So I watched as it slowly grew. I was amazed by how many people continued to think that the revolution was just around the corner. All I saw was a lot of speculation and fraud. Stories of people having their fortunes stolen with no recourse. Scammers using it to extort money from victims. Even major exchanges being hacked and drained belying the claim that it was all decentralized.

But it kept growing. We had loud proclamations that Web3 was here with very little definition of what it was. We had the NFT craze. Everyone was jumping on the bandwagon yet no one could really describe where they were hoping the wagon would go. Remember when Long Island Ice Tea Corp. changed their name to Long Blockchain Corp. and saw their stock jump 380%? Blockchain was going to be the solution to everything!

I started to follow Molly White’s Web3 is Going Just Great and later her Citation Needed newsletter. There was the excellent essay/documentary Line Goes Up by Dan Olson. It was pretty clear that this was all crazy, but it was fascinating. How did people get sucked into this cult?

There was one phrase that seemed to encapsulate the whole movement: Have Fun Staying Poor. It was directed at non-believers. It was repeated so often it was often abbreviated HFSP. It made it clear that the real driver was greed. This wasn’t about making the world better. It was about getting yours and sticking it to everyone else.

There was a moment when it seemed to recede. It was refreshing when FTX folded and Sam Bankman-Fried went to jail. There was a semblance of sanity and there were mechanisms to rein in the worst of the excess. I had hope that the craze would pass, the volatility would die down, people could safely start saving for retirement again.

It’s too real now

I was so wrong. Over the last few months the entire economy seems to have been taken over by HFSP mentality. Leaders in business and finance are happy to get theirs to the detriment of the rest of us. If you don’t embrace it, have fun staying poor.

• Sports gambling and prediction markets are taking off.
  • Sports broadcasts are now plastered with ads for gambling platforms and odds.
  • Even though about 43% of adults see it as a bad thing for society.
  • In response to an American soldier making over $400k on Polymarket we had the president of the USA say, “the whole world, unfortunately, has become somewhat of a casino.”
• AI is the ultimate in FOMO
  • AllBirds, the shoes and clothing company announced a pivot to AI and saw a 582% jump in their stock price in just one day.
  • There has been very little demonstrated value from most AI roll-outs.
  • There’s a rush to invest and spend without any concrete plan on how to recoup that capital.
• Companies are taking advantage of reduced regulation
  • The EPA recently reversed the endangerment finding, meaning that companies no longer have to consider the health costs of air pollution.
  • The FCC seems content to only go after enemies of the president instead of reviewing mergers that will reduce consumer choice and power.

All this in the broader economy means crypto news just doesn’t hit the same way anymore. I used to laugh, I now just sigh. I see the grift, the political dealing, the dropped indictments, the pardons.

I was right that crypto would not grow to take over the economy. I was wrong in thinking that the greedy mindset would stay contained. Now it seems like naked greed is the order of the day. We live in a grift economy. Everything is about taking advantage of others and there are few mechanisms to prevent it.

So what’s next

Crypto used to be a fascinating corner of the economy. I found it puzzling and amazing that some people could make so much money while so many people lost theirs. I couldn’t see the value in it.

The whole economy has become the same grift that crypto was. The mindset is everywhere, particularly around AI. Every week we get a breathless announcement about a new AI model or $100B round of circular financing.

I’m done with it. I have better things to do with my time, energy and emotions. I am going to continue to focus on building real connections with real people in a way that adds real value to their lives. I don’t need another distraction or the negative emotions. It’s time to focus on what I can do differently.