This is The Block
. Today’s big read
(article linked below as well) is about rethinking the way we think about Bitcoin, ignoring the price and focusing instead on the utility (a return to core principles, how intriguing). The thrust of the argument goes like this: Bitcoin isn’t a currency; it’s a protocol, in the same way that email isn’t a letter-sending service but is a protocol for moving information quickly across a wide-spectrum of networks. In the same way, Bitcoin is a means of transmitting information, or value, across the network. In this scenario, holding onto Bitcoin in the hope it will be valuable is the same as holding onto email in the hope that one day it will be valuable.
While the metaphor isn’t perfect, it’s an interesting way to think about this technology in a way that removes the dollar-value investment thinking about Bitcoin, which can be stifling and blinding.
Email and Bitcoin are both mechanisms for transmission rather than storage, and if this is true, what would this mean for innovation in this space? After all, email has more or less remain unchanged since its inception in 1972, and has resisted efforts to “improve” it through “client-side” approaches. The protocol itself has been remarkably resilient, and we use it much the same as we did when we first began using it.
On the flip side, email is a mess. It is awash with spam, phishing attempts, forged headers for hacking, and recently even an obscure encryption schema was found to be compromised. Is the Bitcoin of the future going to be just as easily compromised and broken? Will the blockchain be awash with discarded remains of Nigerian prince-style scams? Most of them would be unsuccessful, but a few might work. Entropy and human ingenuity for schemes and bypassing the law will no doubt take its toll.
Is Bitcoin on a similar path? Will we even using Bitcoin at all in twenty, thirty years? If so, what will that look like? It does seem unlikely that Bitcoin use will look and feel like it does now. But assuming it is used, perhaps thinking of it like email could help spur progress in approaching it as a quick-trip information exchange rather than a store of value.
How can we think ahead and head off the opportunities for graft, for scams, for illegal activities of all kind, while still keeping to the core ideology that brought Bitcoin into the world?
The technology is still young, but it is maturing quickly. We need to think about this stuff now, while there’s still time to ruminate on all the possibilities, good and bad, and if possible, do something about them.