As cryptocurrencies rise and fall, there’s one number that just keeps going up. Whenever somebody loses money to a crypto scam or hack, the Grift Counter on Molly White’s blog, Web3 Is Going Just Great, spins higher and higher. Recently it ticked over $12 billion.
White started the blog in December 2021 out of frustration with the mainstream coverage of crypto, which she says paid too much attention to rags-to-riches tales and not enough to its dark underbelly. Her goal was to paint a fuller picture, to chronicle the thefts and failures, debunk the marketing spiel, and underline the risks in the process.
A software engineer by trade, White coded Web3 Is Going Just Great over the span of a few weeks. It was only a side project, designed to “entertain me and me alone,” says White; she never imagined it would gain any traction. But within a few months, the blog had become a viral hit, earning White a reputation as an authoritative crypto pundit.
Cryptocurrencies, NFTs, and all the related bullshit are nothing but pyramid schemes – MLMs for tech bros. I’m glad most of us and the wider world has finally come to the same conclusion.
I always hate when articles don’t actually link to the actual site they are discussing https://web3isgoinggreat.com Thom this isn’t a criticism of you but of Wired.
On a bright side, given the world we seem to be living in Molly White could possibly make money by turning her blog into NFTs and selling them. Those tech bros would just love them.
I would buy a web3isgoinggreat NFT just for the delicious irony of it. Hilarious idea!
I’m one of those annoying “no true Scotsman” pedants who think that cryptocurrency could eventually be a good thing, but the right design just (mostly) hasn’t been tried yet. The idea of wresting the power to create value-measurement-and-exchange tokens from the banks is a good idea in principle, I think, but Bitcoin just adopted so many of the old assumptions that it merely replicated all the old structures with a new set of people at the top.
The problem I see is that, with any currency that wants to use a store of value as a means of exchange, it attempts to prevent freeloading / forgery of value by making the currency scarce. Maybe it’s artificial scarcity (fiat currency + fractional reserve lending) or maybe it’s natural scarcity (gold) but the scarcity seems to matter to people, and I think I know why. Scarcity and freeloading prevention are orthogonal to each other, yet in the past the former has been the only way to enforce the latter.
I’ve totally drunk the David Graeber koolaid (see Debt: The First 5000 Years), but it seems that mutual credit obligations are a promising way to decouple scarcity from freeloading prevention, thus decoupling our means of exchange from power concentration. Sure, you can still accumulate power with mutual credit, but only by doing valuable things for others and accumulating unreciprocated favours that you can cash in later. IOW, the scarcity is about as natural as it can get — you can only accumulate credit if you can create value.
Ryan Fugger’s Ripple idea, before it got coopted by Big Crypto (RipplePay) and turned into a cryptocurrency, was an example of how this could be done differently from Bitcoin. It used networks of pairwise credit relationships: if Alice wanted to send currency to Carol in exchange for goods/services, but neither of them had a trust relationship yet, they could use their mutual trust relationship with Bob to do the exchange. (Obviously this is unwieldy without computers, and computationally expensive even with computers, which I believe is why RipplePay could step in as a credit clearinghouse — essentially they _were_ the mutual relationship between everybody, something like that?)
But with these pairwise relationships, you get the risk of creditors and debtors. There was another lovely idea created in the 1980s, LETS, a sort of ‘community mutual credit’ which shifted things by saying that when you receive goods, you’re not obligated to the person you got the goods from; you’re obligated to the marketplace at large. Back then the tech consisted of a phone answering machine and a computer with Lotus on it, and since then of course it’s become a web app.Tthe creator of LETS tells me he’s looking into updating it so there’s no central ledger — essentially letting the community itself run the infrastructure.
So I think “yes, peer-to-peer cryptocurrency is great, but it hasn’t been tried yet.” The advantage of cryptography is that it may let us build peer-witnessing systems that can scale up mutual credit from small, first-name-basis communities to massive economies without custodians running the infrastructure. Bitcoin, Ethereum, and Doge are not that thing. Blockchain probably isn’t either.
skeezix,
I feel that truly deregulated currency is a pipe dream. Not necessarily because it doesn’t have merit conceptually, but because anything of value will ultimately creates the same social power structures around it. Whether it’s diamonds, gold, fiat currency, bits on a block chain, etc doesn’t matter, those in power always seek to have it, tax it, and control it.
I don’t think that’s possible. Power begets wealth and wealth begets power in a positive feedback loop producing “billionaires” who are so far ahead that they become untouchable owners of everything that gets created while paying lower effective taxes than average employees. 30 some billionares today have more money than the united states.
https://www.entrepreneur.com/business-news/31-billionaires-are-wealthier-than-the-us-amid-debt/453141
P2P is fine for recording “IOU” transactions, but to take place of currency somehow you need scarcity, otherwise it will be abused by those who are dishonest. The only reason cryptocurrency works at all is that scarcity is built in. Without scarcity, how do you propose to make a currency that has value? Philosophically we might conceive of a system where we distribute some amount of currency to all of the world’s inhabitants, but technically this is nigh impossible without institutions to enforce nitty gritty details and compliance. There’s a lot that algorithms alone cannot do.
Any money system, will need the same protections against fraud we currently enjoy with our current banking system. Anything without those are not going to be good enough to replace what we have. Molly’s site is proof of it.
Read through Molly’s examples of fraud its full of stories of “we thought we could trust person X” but turns our they stole our money. That’s the real world telling you that trust relationships do not work in the real world.
I probably was one of the first couple thousand to read the bitcoin paper, I dismissed its naivety and saw that it could never replace currency on a wide scale. And I think I was right. However, I failed to consider how many people didn’t understand this and would pile in because they thought it would. So basically that’s my stance, I’m 100% percent correct about the absolute conclusions, but man people do dumb dumb things because they are greedy as f*ck. And as a non greedy person, I’m very bad at anticipating what they will do.
Bill Shooter of Bul,
Yeah, that’s the thing, there were a lot of us who knew this couldn’t scale as a currency long term. But even so people do make money in pyramid schemes if they have good timing and it was the same for bitcoin. It was never a good currency IMHO, but as a speculative vehicle wow was it one for the record books.
Not sure if we’ll see a repeat of it in the future, but people are very gullible to the “fear of missing out”, so it’s probably just a matter of time.