The Danger of Blockchain-as-Religion: Don’t Drink the Kool-Aid
Blockchain is an amazing and revolutionary new technology, but it doesn’t overrule common sense.
Sometimes it feels like the blockchain “debate” is playing out in two extremes. On one side you have blockchain purists, advocating for pure anarcho-capatalism and the abolishment of nation-states. I documented some of this ideology in my book review series. On the other side are the traditionalists who think blockchain is a giant ponzi-esque bubble waiting to pop.
I don’t fit into either of those sides.
What if blockchain will become mainstream AND co-exist with current systems?
Decentralization will be leveraged in increasingly impressive ways AND centralization will continue to thrive.
Individuals will be more empowered AND the government will adopt blockchain systems.
Blockchains and cryptocurrency will be regulated AND they will faciliate the frictionless spread of money around the world.
To me this feels like common sense. The internet, after all, was revolutionary beyond anybody’s wildest dreams - yet we still have books, vinyl records, and movie theaters. The revolution doesn’t need to involve burning down the old buildings - it’s more about building up some new ones, isn’t it?
The Danger of Blockchain as Religion
Blockchain will make many people rich, it’s true. Some have already profited in huge ways, crypto-millionaires and billionaires.
It’ll also make some people poor. Money lost in hacks, token values that crash, poor trading strategies combined with emotional fatigue that lead to major losses. We can’t forget that side.
When I see people doing foundationally irrational things on the belief that they are “all-in on blockchain/bitcoin/steem/etc,” I know they are lost in the religion of blockchain.
Religion is about faith, not science. You believe because you choose to believe. This post has nothing to do with organized religion, by the way - you just have to admit that faith is not a good strategy for investing money.
You don’t want to rely on faith for your finances - you want to rely on proven strategies that work while taking new developments into consideration.
I once caught myself deep in the blockchain religion. Then I charted out my personal finance assets. Blockchain has been a huge help to me, I’ve earned more than $10k from Steem alone so far, BUT, here was my distribution:
Steem Power is such a majority of my finances, it is practically all of my finances!
This will be great if Steem moons. Indeed that’s why I have an absolute bottom limit of 1,000 SP - no matter what happens, I never intend to sell my first thousand tokens.
And I hope to reach 10,000k as a new floor one day.
But none of that matters in the present moment - the basic fact that 95% of one’s assets should not be held in a high risk investment vehicle, no matter how good the benefits. Thus I began a power down to diversify some money into a USD savings account.
I caught myself in the blockchain religion and I course-corrected. Unfortuantely many people fail to make the correction.
Mistakes of the Blockchain Religion
If you find yourself saying these things, you’re deep in the religion:
- [Major Social Media Platform] is guaranteed to fail because blockchain will inevitably overthrow it.
- “The question isn’t how much to sell bitcoin for - when you’re ready, you won’t need to.”
- Trading tokens all day is a smart way to earn money.
- “I do not respect the law of government” (lol, sure)
- If you aren’t all in on Steem or Bitcoin or BCash or (any token), you’re an idiot.
These are on the extreme end of belief. I am not accusing you personally of thinking in such extremes, but I see many people using these viewpoints.
They say: Put all of your money in cryptocurrency, if you don’t support a certain token you must be an idiot, government is archiac and we’re just around the corner from a glorious world of individual liberty…
Be wary of anybody who thinks they have the answer to the world’s problems - thinking you’ve solved everything for humankind is a true sign of irrationality.
Be respectful of those who offer their best ideas, while admitting that they could be wrong, and seeking collaboration with other opinions in the search for greater truth.
Don’t drink the fucking kool-aid, ok? I love Steem as much as anybody - spending 20+ hours per week here, deriving my full income from this blockchain, and much more - but even I recognize that you shouldn’t turn it into a religion.
Retain your personal agency, your rationality, and constantly question everything.
What Do You Think?
Do you see a lot of “blockchain-as-religion” in your travels around the web?
I completely agree. Many Alts offer nothing anc have no use case let alone a valid one, yet their market caps are in the millions just because they are crypto.
I do believe blockchain tech will change the world but that doesn’t mean all blockchain projects are valid or worth anything, nor that they will all succeed.
Great minds think alike
I think it's stupid to blindly trust cryptoassets - regulation will come at some point and noone knows how this will play out. don't invest more than you can afford to lose and hope for the best :)
AGREED!
I agree that 90% of all the money in SP is bullshit...I have though 99% of all my "liquid money" (not counting the value of my flat or anything in the flat if you know what i mean) in big variety of cryptos (probably out of belief in the technology)...I though at the same time am willing to lose it all cuz I don’t fucking care about money. So I will rather support systems that do in return support me, then those that restrict and control me. There might be time when I will need some fiat to function...and maybe not...who knows...anyway you are able to earn most of your money here because of those Blockchain purists/believers (because who the fuck would have millions of dollars in here otherwise??:D)...ever thought about that? By this logic whales are irrational (I highly doubt that most of them have their SP investment only as 1-8% of all their money)…so are they really? Or is it just that you have to “believe” whenever you invest into anything with long-term vision?
Do you have any evidence to support your claim that most crypto whales are putting 90+% of their net worth into digital tokens?
I dont think the best thing for steem is that people shold commit all of their savings to the blockchain. I think it is much better for Steemians to be financially diversified, perhaps making a big bet of 20-30% assets in SP but not putting all of their eggs in one basket.
Its not like I am advocating that people wasefully spend their cash. Just diversify across other cryptos at the very least, and probaby keep an absolute minimum of 25% of assets in fiat even for the hardcore purists just as a common sense hedge against the worst case scenario.
No evidence...As I said I only doubt that...or do you think that all the whales are overall super rich? It certainly can be possible that’s why I chose the words carefully:P.
Sure that’s pretty much what I said. It is a bet not to have almost any fiat now i admit...but fiat is losing value and crypto is gaining value for now so the bet is working well so far (and luckily I don’t need almost any fiat and will not need it in few upcoming years)...at one point it will be clever to pull a bit out of it that I admit too...or simply crypto will be generally accepted and we all could celebrate at that point:)
Yeah religious language is already starting to creep into those going on the defensive:
https://www.google.co.uk/amp/s/cointelegraph.com/news/crypto-investment-shows-limitless-ignorance-of-human-race-hedge-fund-tells-clients/amp
There is a whole divisive agenda going on right now.
I agree with your sentiment above:
"Decentralization will be leveraged in increasingly impressive ways AND centralization will continue to thrive.
Individuals will be more empowered AND the government will adopt blockchain systems."
It's a shame people always tend to drift to one of two extremes in life.
It is a shame. Maybe one day as a society we'll get better at rational thinking on these kinds of things.
Blockchain will surely make the researcher and those who know their onions well but will make the lazy and those that hate doing research poor.
My 2cent
lol. I think people who believe in crypto also are libertarians.
A lot of them are. Maybe all this money will help them as a party
As a general rule: NEVER drink Kool-Aid. It clouds one's perspective and one's (objective?) critical and analytical senses.
Be a fan but stay both analytical and critical. Be of value by being both analytical and critical.
lol what a beautiful post @heymattsokol . i like your post. thanks for share the post.
good post,