US regulators just zapped Kraken for staking crypto for its US customers.

Some say this is heavy-handed, nonsensical overreach by a cabal of well-coordinated anti-crypto zealots at the highest levels of government.

Maybe, maybe not. So what? Anybody can stake crypto on their own. That’s the whole point.

Death by any other name . . .

Since May 2022, the biggest crypto lending platform, the biggest crypto trading firm, the biggest crypto broker, and the #2 crypto exchange have all collapsed.

The #1 crypto exchange might follow, along with several large bitcoin mining companies and the company that manages the largest Bitcoin fund on Earth.

People smarter than me say the worst is yet to come. Permabulls say you need to sit in cash for the duration of 2023. Peter Schiff, Warren Buffett, and other old white guys are screaming “crypto’s a scam!”

Meanwhile, bitcoin continues to churn out block after block. Aave continues to settle financial transactions. Chainlink continues to feed prices and real-world data into distributed networks.

Businesses die. People steal money. Traders fall apart.

The protocols persist.

That's what they do

Maybe that’s the thing everybody misses when they say cryptos “do nothing?”

Maybe cryptocurrencies don’t need to pay dividends, generate yield, have government backing, or offer “intrinsic value.”

They just need to work. Their value comes from what people do with them.

Whether their prices go up depends on their token structures, though speculative enthusiasm certainly plays a role.

What if it doesn’t matter what happens to 3AC, Genesis, or any other entity that operated in the legacy financial system?

Silvergate can go bankrupt. Binance can collapse. Celsius’s founders can go to jail. Grayscale can dissolve.

Fraud? Theft? Failure? Bankruptcy? Sovereign debt default? Coup d'état?

The protocols persist.

Consider the alternative

Our legacy financial system requires massive bureaucracy, laws, rules, oversight, insurance, and government intervention just to function. It’s expensive, unwieldy, complicated, and often exclusionary.

And it still fails all the time.

Some governments are corrupt. Some regulators are incompetent. Some leaders are thieves. Some plans don’t work out the way people expect.

We buy into protocols, not people. Tokens, not firms. Financial networks, not social cliques. Computer codes, not bureaucrats.

We bet that successful cryptocurrencies will offer more lasting, substantial, and durable returns than legacy assets.

Progress comes in fits and starts

You may have started to question crypto.

What does it do? Why does it matter? Why doesn’t it work? Do I really believe in the ideology behind bitcoin or the purpose of these altcoins?

Great things rarely come from ideological purity, utility, or clever design.

Serendipity, risk, luck, effort, creativity, money, vision, and timing play a role. Nobody knows how much of each gives you the best mix for success.

For tens of thousands of years, humans have put money into things they think will make the world better or make themselves wealthier. We have centuries of businesses and patents as proof.

These efforts usually fail, but sometimes they succeed. Why should crypto be any different?

That’s the adventure. Discovery has its own reward. With crypto, the best discoveries can grow your wealth in ways the legacy system can’t.

Technology does not decide its own fate. We do.

Bit by bit, year after year. One person’s work builds on another’s. Market forces drive prices up and down, sometimes at a whim.

Algorithmic stablecoins fail until one of them succeeds.

DeFi protocols get hacked until developers iterate away the vulnerabilities.

NFTs suck until somebody figures out how to build a viable business around this new way to confirm ownership and distribute time, intellectual property, and creative works.

We still need clear laws, frameworks, standards, and transparency so earnest builders will not get lumped in with scammers, developers can innovate without fear of jail or censure, and communities can grow without frauds and charlatans stealing their money.

That’s the next step: regulation, litigation, and engagement from governments and global financial organizations.

It’s a hard step, but we have a lot of great people advocating for us.

The longest yard

While they work, let’s not lose perspective on the problem we’re trying to solve.

The legacy financial system can’t give us what we want. These closed systems of control can no longer keep up with the demographic, social, and technological changes that drive modern commerce and communications.

Cryptocurrency offers an alternative but its fate depends on the devotion of builders, developers, and investors.

That devotion doesn’t reveal itself in the next 100x altcoin, a new data model, or some on-chain metric that most people don’t interpret correctly.

It comes from people like us who understand the power of this technology to change our contemporary notions of wealth and finance—and in doing so, give normal people a chance to own a stake in the future, rather than the scraps of whatever trickles down from those who hold power.

What does that future look like?

Nobody knows yet.

That’s the beauty and excitement of this world we’re trying to build.

One vision is the one I present in my book, Consensusland. Another vision is Satoshi’s. Another vision is Vitalik’s and dozens of other visions, all possible, none inevitable.

These visions don’t come with price tags. They go beyond four-year cycles. They transcend market conditions and reflect something far more powerful than whatever price your CoinGecko app shows you on any given day.

Obsess over prices and you’ll miss the revolution.

No matter what happens to the businesses built on crypto, the protocols persist.

Can you?

This post is also available as an NFT on Mirror.

Mark Helfman publishes the Crypto is Easy newsletter. He is also the author of three books and a top bitcoin writer on Medium and Hacker Noon. Learn more about him in his bio and connect with him on Superpeer.