Crypto may change the world, but possibly not in the way you’re expecting…

A lot has been written about the crypto space, both now and in the 2017/2018 bull market, asking whether we're in a bubble. The obvious comparison is to the late 90's tech bubble, where anything with a .com in its name would moon, the same way adding "blockchain" to your name or random coins will moon these days. But in my view, while that's a reasonable comparison, there's a better analogy for the current crypto craze. It's one that actually happened coincidentally with the .com bubble, but has largely been forgotten… the Open Source / Linux craze.

Back in the late 90's, there was a lot of talk about Linux as a desktop OS. Each coming year was touted as "this is the year for Linux to take over the desktop!" Linux could do anything that Windows could do, but was a lot cheaper. People would claim that OpenOffice was just as good as MS Office (it wasn't) and way cheaper (it was). When asked about games, they would point to games like Quake III Arena and Tux Racer (which was a fun game, but only appealed to Linux fanbois).

The analogy should be pretty obvious: a lot of blockchain-based games are targeted to crypto enthusiasts. That's never going to enough. Games need to have mass appeal and crypto/blockchain tech needs to be easy to use for anyone. We're not there yet, and it's not clear we ever will be. It's the same with using crypto currencies like Doge or BTC or Nano as a daily currency to buy things. What are the advantages relative to using Paypal / Venmo / Cash.App? Virtually none, and price volatility is a significant disadvantage.

There are a lot of applications for crypto / blockchain tech that are being explored right now. That's good, that's innovation playing out in front of our eyes. But we should be prepared for most of those applications to fail, in the same way that Open Source versions of proprietary software largely failed…

Or did they? One could argue that Linux won the "desktop" battle, in the sense that many people use it today as their primary OS (Android is based on Linux, and iOS is UNIX-based). Open Source is here to stay — many companies are using Open Source tools and donating software back to the community. Both of these technologies changed the world, just not in the way that was envisioned 20+ years ago.

The same could be true of Bitcoin, blockchains, and decentralization. They may very well change the way people think and act, even if the way they do that isn't foreseen right now.

TL;DR:

Bitcoin could be like Linux was 20 years ago. Decentralization could be like Open Source was 20 years ago. Both technologies changed the world, but not in the way that was expected at the time.

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Frank Fingerman