TLDR:
“Money is the most successful story ever invented by humans, because it is the only story everybody believes.” — Yuval Noah Harai
This story is being rewritten right now with technology.
I believe shared public ledgers are a core technology innovation that enables a new platform shift — so while this is about money, but it’s not just about money. It moves us into a new era of permissionless technology innovation which is not dominated by any of the large technology players. Further, it is structurally so different that it’s hard for incumbents to marshall their resources to address these opportunities. Permissionless innovation is foundational to the exciting technology, software, and Internet trends that have been at the core of my professional career to date. This is why I’m spending all my time on blockchain projects.
I spend a lot of my time talking to smart engineers/entrepreneurs, trendwatcher VCs, and other angel investors who are looking for “the next big thing”. It has been a while since we’ve had a platform shift enabling a lot of new innovation and many entrepreneurs and financiers have accepted that maybe this lull may last a long, long time.
I first got turned on to Bitcoin in 2012 when my friend told me about how he was mining on his home computer — he’s very smart so I knew I should be paying attention. As well, at the time, Coinbase was sharing an office building with us at our former loft workspace in SOMA and we ran into them in the elevators often trying to recruit engineers. :)
What started as a personal curiosity has become what I believe to be the beginnings of a new platform shift and a tidal wave of innovation.
Throughout my career I have experienced 3 such tidal waves from reasonably early days:
- The Web
- Social Networking
- Mobile
At the time I got involved with each of these there were lots of reasons to be cautious of each. There were tons of problems to figure out with each. Each seemed very toy-like (regards to Chris Dixon) compared to the existing way things were done. It was relatively easy to see the challenges of each as insurmountable. Now that we’re past the revolutions of each they seem fairly obvious and cemented as part of our daily lives.
The characteristics at the time:
- Passionate developer communities — “the nerds” loved them and we spent all our time on them
- Extremely experimental — there were lots of experiments and lots of failures — the experiments were being run by tons of very creative people often distributed all over the world.
- Dismissed as inappropriate for mainstream users — the usability was generally bad to moderate, the utility was “barely okay” for the majority of use-cases described and imagined
- Combination of “extreme excitement” and “extreme dismissal” by many in the venture/finance community — while passionately believed-in by a few risk-takers in the venture/finance community, these were also dismissed during some period by the majority of venture investors for what sounded on the surface to be smart reasoning.
I think blockchain technologies have plenty of reasons to be dismissed today:
- We haven’t yet seen much provable, major end-consumer utility (except maybe store of value in Bitcoin and even that’s quite arguable given the volatility relative to USD).
- There are lots of blockchain apps that look more like “fart-apps” and “flashlight-apps” than serious engineering infrastructure endeavors.
- Given the nature of ICOs and liquidity there are all kinds of perverse incentives to “launch” things and then never build them out.
I think with these risks come the opportunities for permissionless innovation. It’s the kind of risk and opportunity tradeoff that has always been attractive to me. And I’m excited to professionally go “all in”.
Thanks to Jen Yip, Avichal Garg, Hunter Horsley, and Steve Lee for providing feedback on early versions of this.