Crypto Bros
I've been using computers since before the graphical internet existed. 2400 baud modems with green screens? Yep I was using those. Token ring networks? Also and they were painful. So I can tell you I've seen many cycles of technology and bullshit.As a result I have a strong bullshit detector built into me. It makes me seem extremely cynical, but it is cynicism that has come from deep experience and knowledge.
One of the cycles of bullshit I've seen ( which still persists today stupidly ) is Bitcoin and the Blockchain.
The general concept is that Bitcoin is an advanced decentralized currency mechanism and is the future of finance.
That concept is a flat out lie from what it is. It is the claimed vision though. It is what was touted at the beginning and what drew people in.
People were told "this prevents control of transfer of purchasing power by governments". Only... that's false.
Bitcoin, like anything else, is actually completely trackable. The record of who owns what bitcoin? Is completely public. Every transfer? Public. By design.
So why do people still say it is safe from control? Because the claim is that you don't need to identify your real human self in order to "get bitcoin".
This is absolutely fucking idiotic and I'll explain in a simple way why.
Public / private key identities have existed much longer than Bitcoin. To make such an identity is easy. Or at least it is easy to do. How it works mathematically is complex but that is irrelevant for this discussion. You run a program on a computer and that program generates a public/private keypair.
The public key? That's how people write messages to you that only you can decrypt, or how people know for sure that a message you digitally signed came from "your public key identity".
To do all that? You don't need to identify yourself. People just need to interact with you by way of the "public key identity".
Now, lets consider we make a "purchasing power exchange system". It doesn't matter if it is centralized, decentralized, blockchain, or whatever bullshit you can devise in order to know who owns what. All that doesn't matter. All that does matter is if you can tell who owns what piece of "digital money". So long as you can do that, you can update the system keeping track of that when you transfer this digital money.
What can do that? A simple database. Which we've known how to do for ages.
So why on earth would we use "the blockchain"? Well I'm getting ahead of myself, and I also think the blockchain is an utterly pointless piece of tech.
Instead lets discuss how a "bitcoin gets minted". There is an arbitrarily difficult mathematical equation to be solved. It takes enormous computing power to solve it. The parameters of that equation change over time, and the difficulty to solve each one can be increased as computing power advances due to technology.
To "mint a bitcoin" you just need to solve one of these complex equations and show proof you have solved it. The first person to do that? They own the bitcoin.
This could be done with a decentralized system or a centralized one. Or a handful of trusted people.
The decentralized system is preferred with the idea that anyone can join the network and share a solution saying who owns that solution. The issue with the trivial "I solved this complex equation" idea is that you can't share the solution with anyone without them being able to steal the solution.
The blockchain solves this by making your identity part of the equation being solved. So when you provide a solution, nobody can claim they made that solution because the equation itself includes your identity as the solver.
The problem with the blockchain is that it requires every single person using the bitcoin system to update their position in the blockchain in order to come to agreement on what is currently happening. This is not scalable, and as a result there is a very high computing cost to maintaining "the blockchain network."
It worked alright when there were few users of the system. Today it is unreasonably costly.
There is another issue. The computing cost of minting a bitcoin is completely wasted. It is burning energy to compute a completely worthless thing that we don't need.
Why don't we need it? Because you don't need to have some crazy anonymous way to mint a digital currency coin.
Consider how currency was created historically. Initially it is just an IOU system. You do something for someone else or give them something. They give you an IOU saying they owe you. Later when you want something from them, you show them the IOU ( or multiple of them ) and use that to convince them to give you what you want from them.
That system can then be extended by trusting IOUs issued by trusted people.
The next step past trusted individuals? Banks.
After that? A government entity.
All of this can be replicated anonymously using public/private key identities and a digital trust network. No governments actually required. No crazy bitcoin chaos. Just increasingly scalable IOUs.
Essentially, Bitcoin attempts to solve a problem that isn't real. It's not needed.
There is another even simpler way to create a digital currency. Get X people to agree to join the network. Mint Y digital coins and give an equal amount to every founding member. Let them exchange and/or subdivide those digital coins. Let anyone join but don't keep issuing more coins just make do with whatever coins exist.
That also works and doesn't waste any effort on solving complex equations. There is an issue though with such a simplistic system. You need to keep track still of who owns which digital coin. That can be solved with modern databases. The reason people still applaud and hail bitcoin is because it doesn't required trusting any specific party to run that database.
There remains a flaw with the idea of Bitcoin though as not requiring trust. Trust is still required. To who do you ask? Trust in those defining the specification of how the Bitcoin network itself works. That network? That software? Can arbitrarily give more Bitcoins or take them away. People will say "well we don't trust false updates; we only trust reasonable updates it is by concensus of the users of the Bitcoin network." Is it?
There is another problem with the Bitcoin system, which didn't exist so badly when it was first created. When it was first created it was relatively easy to "mine a bitcoin yourself." I mined a bunch of them using my own systems back in the day. Over time it has become increasingly more costly to do so, to the extent it requires a significant amount of actual money to buy and run the hardware necessary.
People still do so, but the cost to generate a Bitcoin current exceeds the cost to "buy one in cash."
The reason people don't want to buy them in cash is because then you immediately identify yourself to the government by doing so, invalidating the whole point of "it's an anonymous digital currency."
The opposite probem of buying them exists as well. If you want to sell a Bitcoin for cash? That's tracked and monitored by the government. This is why on your taxes in the US they ask you if you are using digital currency, because if you bought or sold them with cash there is a paper trail and the government is going to demand their cut of whatever you are up to.
Which brings me to the real problem with Bitcoin. There is no human reeason to use it besides engaging in shady and/or illegal behavior. This is why I stopped using it myself after learning about it long ago and even mining a bunch of bitcoins myself.
I knew it would take off. I knew it would become more and more valuable as it enables crime of all sorts. I intentionally stopped using Bitcoin because I consider using it to be immoral and enabling of criminal behavior worldwide.
I've now spent a lot of time roughly explaining Bitcoin and digital currency systems. I have still not gotten around to explaining what a "crypto bro" is and why I hate them so much.
My definition of what a "crypto bro" is is this: Someone who claims Bitcoin ( and to some extent other more modern digital currency systems ) is a revolutionary invention and you should invest-in / participate with such systems because you can escape from the tyranny of the "old systems" by doing so and thus become empowered and be better off financially.
There is an extended thing about "crypto bros" ( who I'll call cbros because I tire of typing that ). The extending thing about cbros is that they believe that they seem to believe they are superior to other people and deserving of more wealth because "they are intelligent and know about crypto and the value of it."
That superiority complex is toxic and enables them to engage in harmful behavior. It serves as a sort of cult conditioning. It is further worsened by the "us versus them" mentality, where they know better, and you who believe in the classic system of currency are a fool because... well... they think you are stupid. If only you knew what they know, you would agree with them.
I know what they know, and I know it's a pile of self delusionary garbage.
That's an easy attack though to throw their way. I have thought given a bunch of evidence as to why it is true and I will go further by explaining why cbros are so harmful.
They are harmful because they preach a false narrative. That narrative is "buy into crypto and you can get rich like I am." Many of them say this because it is true from their narrow point of selfish view. They bought into or mined bitcoins at some low "value" and now they have a very high "value" in bitcoins in comparison to their start. The practical result for them is the entire message, and they believe it can be replicated.
The problem with this is in the why that happened. The cbro will tell you that it happened because Bitcoin preserves value and isn't subject to inflation and manipulation by governments. That's only a justification though. The real reason Bitcoin increases value over time so much is twofold. One: It exists primarily to fund crime. Two: It's a pyramid scheme where a few get richer while most lose out.
The first part of that is obvious due to the nature of it. Remember where I asked "Why do we even need this?" You don't unless you are engaged in some illegal behavior. Thus, by design, it enables and encourages crime.
The second part we need to step back for a moment and look at the larger picture and claim.
The claim is roughly "if you buy bitcoin at X value it will increase within Y time to Z value." This is a problematic claim because it exceeds the "it's not subject to inflation" bit. If it was simply not subject to inflation and doesn't grow past that, the pyramid scheme would be harder to see.
When it exceeds that? It's easy to see.
Let's explain it more simply. Suppose the following sequence:
- You buy $100 of Bitcoin
- You wait a year or two
- It's now worth $300
- You sell it and get $300
- Success! Bitcoin is awesome!
This is a stupid sequence and belief because money does not come from nowhere. No value is being created through the use of Bitcoin. Bitcoin is not an investment in a venture. The closest equivalent to that is that it is an investment in criminal enterprise.
I don't though think the primary returns are coming from criminal use. Or at least not the majority. I think the primary returns in this scenario are coming from other people "buying into the Bitcoin bullshit." That is, people buy in with cash, and lose out.
It is impossible for the step by step scenario I laid out to "happen for everyone." It only works because for every "Bitcoin winner" there are a few "Bitcoin losers." That's why I call it a pyramid scheme.
Of course the cbros will tell you that the "Bitcoin losers" only lost because they were foolish in how they used Bitcoin and don't "know what they know." That's a load of rubbish though and is just internal justification they tell themselves about how they deserve to get rich, because only they understand how valuable and revolutionary Bitcoin is.
I've essentially covered my primary beliefs about "crypto" and cbros. I need to explain though why I dislike cbros so intensely. I am hugely dismissive of them and those who don't know much if anything about my history, knowledge, experiences, etc just think I sound like some hateful and jealous dissenter.
I don't hate the people. I hate what they are doing. It is actively harming other people. People believe in the false message they are peddling and end up financially harmed. Worse, people use Bitcoin and enable criminal activity in the process.
I'm not jealous of these people. I am not jealous of hurting others to benefit myself. I am not jealous of a smug superiority complex where incomprehensible terminology is rattled off and used to justify that I'm better than anyone else. In fact, I don't believe I'm better than others, despite that I do have extensive knowledge of computer technology and decades of industry experience.
I dislike cbros because they are selling a simple lie. The lie is that technology can solve problems with society and humanity. That is a nice wish, but is sadly false for the most part. Technology is a tool that can be used for good or evil, and in the case of Bitcoin that scale leans toward the evil side.
Bitcoin did not remove greed, corruption, manipulation, crime, or power structures. It merely digitized them, wrapped them in cryptographic jargon, and convinced a generation of smug technologists that participating in the system made them revolutionaries instead of speculators.
The tragedy of crypto is not merely that it failed to fix society. The tragedy is that many of its loudest advocates stopped trying to fix society at all and instead became obsessed with finding a way to financially escape from everyone beneath them.