Day 25: Crypto is the coordination business

The crypto conference circuit, put on pause during covid, is back in session. This week everyone is in Korea... next week they'll be in Singapore. Each new week brings a new blockchain week. It's a bit of a traveling circus. It makes you wonder what problem is this so-called industry trying to solve. Laser-eyed Bitcoin maxis will tell you that everyone is a bunch of degenerate VC-funded gamblers. But that's not the whole story.

We humans are social creatures and much of our power comes from our ability to work together with other humans. These organizations take many shapes and sizes. On the small side we have the married couple and nuclear family, extended families and tribes. And more recently we have much larger organizations like the joint-stock company and eventually the modern corporation allowed humans to voluntarily pool their capital and labor to tackle tasks that are too big for one person alone. And who could forget the nation-state which does something similar but adds violence and geography into the mix...think of it as a group that tackles large problems through using force to allocate capital and labor.

Crypto - bitcoin included - is also in the business of human coordination. While the corporation allows humans to tackle problems too big for one human and the nation-state does the same but with violence, crypto tokens enable humans to tackle problems that are too big for one corporation to tackle. When I say too big, I mean that they carry too much risk for one entity to carry on its own.

Imagine if Satoshi said he was going to start a corporation to separate the state from its control over money. His enterprise would have co-opted by the state...as happened to PayPal or shut down like Liberty Reserve.