if you want to know whether a given crypto project is a scam, there’s a very reliable heuristic, which is to assume the answer is yes. but suppose you want to actually not discard the one occasional good idea.
there is one very simple rule to determine if a crypto idea makes any sense whatsoever. crypto makes sense as a solution if you can’t trust anyone. not the government, not some institution that is bound by laws, not a majority vote of some set of reasonable people. (but also you think civilization won’t completely collapse, e.g the internet will keep working). removing the need to trust people/institutions is the only advantage of crypto. for this one advantage, we pay dearly in terms of everything else. crypto will always be slower, less efficient, less usable, less scalable than the obvious centralized solution.
this is a completely self consistent threat model. but the set of things you can trust in this world is extremely tiny. you can’t use anything tradfi, because those ultimately rely on visa/Mastercard and banks and such to not fuck you over. you can’t live in a house you own unless you have the arms to defend your house, because your ownership of that house depends on the government having a record somewhere that you own that house, and its willingness to use police to defend your house. you can’t really invest in anything except physical assets you can put in your house, because any stock is just a digital record at the DTCC. you can’t really rely on any food or water from the outside world to be safe unless you are testing it yourself or producing it yourself.
there are people who genuinely live in a world like this. especially in certain politically unstable countries. but this is a very small subset of people, and the vast majority of crypto projects will never ever be used by any of those people. (and there will almost always be a better way to help them.)
this is a completely self consistent threat model. but the set of things you can trust in this world is extremely tiny. you can’t use anything tradfi, because those ultimately rely on visa/Mastercard and banks and such to not fuck you over. you can’t live in a house you own unless you have the arms to defend your house, because your ownership of that house depends on the government having a record somewhere that you own that house, and its willingness to use police to defend your house.
This is a strawman argument. There are any number of legitimate scenarios where:
Society has not collapsed.
You would like to do something that traditional finance would not allow you to do.
Most obviously, since this was both one of the original intents of cryptocurrency and one of its primary modern use-cases, you can transfer funds to individuals and institutions that have been “deplatformed” by traditional finance. Beyond the use-case of selflessly sponsoring dissidents whose views lie just outside the permitted Overton Window, there is also, of course buying pornographic materials and drugs in places where they are banned[1].
“I can benefit from trusting this person with some tasks and some information, but not with other tasks and other information” constitutes the majority of my interactions. I would assume that this is true for almost everyone.
there are people who genuinely live in a world like this. especially in certain politically unstable countries. but this is a very small subset of people
if you want to know whether a given crypto project is a scam, there’s a very reliable heuristic, which is to assume the answer is yes. but suppose you want to actually not discard the one occasional good idea.
there is one very simple rule to determine if a crypto idea makes any sense whatsoever. crypto makes sense as a solution if you can’t trust anyone. not the government, not some institution that is bound by laws, not a majority vote of some set of reasonable people. (but also you think civilization won’t completely collapse, e.g the internet will keep working). removing the need to trust people/institutions is the only advantage of crypto. for this one advantage, we pay dearly in terms of everything else. crypto will always be slower, less efficient, less usable, less scalable than the obvious centralized solution.
this is a completely self consistent threat model. but the set of things you can trust in this world is extremely tiny. you can’t use anything tradfi, because those ultimately rely on visa/Mastercard and banks and such to not fuck you over. you can’t live in a house you own unless you have the arms to defend your house, because your ownership of that house depends on the government having a record somewhere that you own that house, and its willingness to use police to defend your house. you can’t really invest in anything except physical assets you can put in your house, because any stock is just a digital record at the DTCC. you can’t really rely on any food or water from the outside world to be safe unless you are testing it yourself or producing it yourself.
there are people who genuinely live in a world like this. especially in certain politically unstable countries. but this is a very small subset of people, and the vast majority of crypto projects will never ever be used by any of those people. (and there will almost always be a better way to help them.)
This is a strawman argument. There are any number of legitimate scenarios where:
Society has not collapsed.
You would like to do something that traditional finance would not allow you to do.
Most obviously, since this was both one of the original intents of cryptocurrency and one of its primary modern use-cases, you can transfer funds to individuals and institutions that have been “deplatformed” by traditional finance. Beyond the use-case of selflessly sponsoring dissidents whose views lie just outside the permitted Overton Window, there is also, of course buying pornographic materials and drugs in places where they are banned[1].
“I can benefit from trusting this person with some tasks and some information, but not with other tasks and other information” constitutes the majority of my interactions. I would assume that this is true for almost everyone.
(the latter is often considered a bad thing for society, but there are nonetheless lots of people to whom it would be useful)
No, it’s most crypto users, cf. Scott’s Why I’m Less Than Infinitely Hostile To Cryptocurrency