There is an electric excitement and explosive media buzz about crypto currencies, bitcoin and everything running on blockchain. Is it a movement that will propel humanity in a new tech driven tokenized economy? Or is it an overhyped bubble that will explode into a million token particles in a few months? Fact is that there are daily 500.000 new subscribers on token platforms, and the majority of subscribers that join the ‘get rich quick club’ have no idea what it’s all about. Governments are worried about regulation, banks scratch behind their golden ears and try to implement something neutral by composition in their by default biased pyramid structure. Is there something that can potentially survive the token gamble rally and become of real value to real people?
Most of the 900 crypto currencies that are ‘out there’ did their money raising round (ICO or Public Token Offering that is called) on a whitepaper, some good-looking team photos and their network. But no real value behind that. It tastes like the internet bubble in 1998, where every smart nerd with a DOT.COM in their startup was good for millions. Because there was simply the promise of internet. But after the initial ‘the sky is the limit’ euphoria and investors wet dream, all that was left was a financial wasteland with many dead dot.com bodies. The smart ones had exited already selling their promise of simple internet shops for vibrators, the next 100th search engine or something like pets.com, that sold stuff for pets. To give a hot-air balloon example: Petshop.com had 700.000 revenue in a year while spending 12 million on marketing. I guess you can call them dreamers.
Internet soon became a safe haven for porn and sex sites that made millions, from 56k modems and waiting for the tits to show up until the G-networks. And after a decade or 2, well we all know what came of the internet. The reality is that, despite the initial dream of neutral free information, it is dominated by some big-time monopolists in a pyramid structure. Google, Amazon, Facebook and a few others sit on more than 60% of data running in expansive super data centers. On the other hand, internet has brought us a wave of more efficient planning, organizing and connecting to the human field of expanding information. Life has become so much easier in the age of information. But it has come with a price, literally!
We are in a second revolution right now, powered by blockchain, and fueled by trust. When you don’t need controlling banks anymore as trusted third parties for transactions, then you can feel the potential of a revolution in the way we have set up our economy. In that system we have given banks the magic power to print money out of nothing and rule even governments. And the point is that they lost their trust status a while ago, so somebody had to come up with a better plan anyway to combine technical innovation with growing awareness and empowerment of people. And now we have the new kid on the block: Crypto’s. They started ruling the news headlines when bitcoin broke the 10.000-dollar barrier and did a runner up into the 20.000-dollar area at the end of December 2017 as a big X-mass gift for the bitcoin elite. It got back in the basket now around 12.000 per coin, but still. Bitcoin is the flagship of crypto currencies, but maybe only the tip of the iceberg of a new Tokonomy.
Almost 1 billion dollars is raised now by crypto startups. Similar as with the dot.com bubble, most of the startups have not proven their concepts yet, but there is the super excitement about the game-changing role of blockchain. This is comparable with the sense of coming freedom and expansion we felt around the dot.com bubble, when Internet itself was the promise. So, is this the crypto bubble? There are similar out of the box ideas out there in crypto land like the wank-coin, rewarding the amount of porn you watch. And there are more similarities. Dark web, tor and silk road caved out the road for criminal money to enter the blocks, using its anonymity. This is comparable with the first days of internet where dark monsters from humanity’s shadowy places thought they had found a digital safe haven to do exchanges. The bubble will pop at the moment that people lose trust in some of the crypto’s, or when some billionaires in China decide its more beneficial for them to let it crash. This will filter out the cryptos that actually give something to ordinary people, that are simply put: of use. Technological innovations are only that good in the way they really improve the life of ordinary people.
And here is when the utility token comes in to play: the crypto-currency that is backed up by something real and tangible. Investors will realize that it will become too risky to put millions in some whitepapers full of tech language, or the next fancy casino coin. They will wisely increase their diligence and move to a vision and believe that the world needs a change and technology will bring it. In fact, this can simultaneously happen bottom up! People are embracing the change, they are adopting new values, and by doing so they create a new culture. Bitcoin started off as a small community of believers and is now a worldwide accepted super token. The libertarians, cyberpunks and crypto anarchists are the founding fathers of a real movement to empower people. They invented the blockchain as a means to unblock the chains of a monopolized, hierarchically structured system of modern day slavery for which the failing banks stand as a symbol.
Utility tokens can do even better! They represent real value. They represent utilities that can be ‘mined’ in the future like green energy (www.wepower.network), data capacity for storage and computing (www.threefoldtoken.com) and even human working hours (human energy token). Still more than 50% of the world has no access to internet, and more than 60% has no bank account. For humanity itself it is time that we become more human, close the gap of inequality, move closer to our core and our heart. That means we stop stealing to survive, we can start giving to thrive. Maybe in some point in time we look back and we can clearly see that this mega redistribution was the start of the healing of our ecosystem, in ways that are beyond our comprehension. In tech thy shall trust!
Lucien Lecarme, 13 january, 2018