Crypto Is Far From Perfect
0xx’s educational ethos is one that believes in contrarianism, including listening to viewpoints that oppose our community's collective philosophy. To have a well-rounded, comprehensive perspective on the blockchain and web3 space, we also have to shed light on the parts we dislike.
We are not crypto-maximalists. We don’t believe crypto is perfect and that it’s going to fix everything. We believe web3 is ambitious and that by no means is its success guaranteed. And in fact, the only way to increase the likelihood of its success is to talk about the areas we could do better.
So today, we are sharing our five least favorite things about crypto.
Crypto is full of them, from influencers shilling tokens just to get a paycheck, scammers phishing for your wallet info, to project founders running away with community funds (aka rugging). Traditional internet financial crime still eclipses crypto-crime, but crypto-related financial scams are growing much more quickly.
Because often, these scams get a lot of media attention, which disproportionally makes the space look like one big scam and overshadows all the amazing things happening in the blockchain space. Likewise, scams scare new folks away (which we get), but it means they are missing out on early adoption and potential opportunities.
So what’s to be done? Look, people are always going to try to take advantage of others using the new tools of the day. It’s going to take more than blockchain to change this human behavior. So the best way to protect yourself is to get educated about the risks and have a supportive community that helps to share tips and alerts.
I think/hope/pray that because of blockchain transparency, the future includes the equivalent of spam filters or alerts when it comes to projects. Until then, we have to stay diligent and help each other.
Ugh. Do we have a long way to go in making it easy and smooth for users to onboard into web3. Apps are still clunky and often confusing. And some applications and products change so fast that it can be hard to keep up. Something we see time and time again when it comes to web3 apps is an imbalanced emphasis on the tech and not enough thought around the user experience (UX) design for user interfaces (UI). And while we’re on the topic…two other products that need massive improvement before we can see wide-scale adoption is better security solutions for wallets and private keys and better options for investment insurance.
All of this will come, and we know we’re being a little impatient…but the sooner, the better 🙏🏼 #candevspleasedosomething
Tech inherits cultural use cases. In many ways, the speed of data (and bots) is faster than we can keep up with–especially in terms of cultural checks and balances. While this is an issue broader than crypto, trolling culture does permeate into the crypto-sphere. Some of the most popularized memes, such as Pepe the Frog and Wojak (feels guy), have 4chan links to white supremacist trolling. While the nature of memes includes both replication and mutation (and one might argue that the disassociation of the meme from supremacist use case weakens the power of that significance), it’s important for people engaging in the space and interacting with these memes to be cautiously aware of dog whistles embedded within.
Notably, a version of this debate is playing out in the courts after BAYC filed a lawsuit against Ryder Ripps after he released a documentary alleging that BAYC is laden with white supremacist iconography. He’s calling for BAYC holders to burn their apes while at the same he’s appropriated the entire BAYC collection “a new mint of BAYC imagery, re-contextualizing it for educational purposes, as protest and satirical commentary.”
While grappling with shadow meaning embedded in memes is an ongoing learning curve as our lives become increasingly digital, there are other areas where marginalization is prevalent in the space.
It’s no surprise that crypto developers are predominantly white, cis, and male and the nature of the culture within crypto organizations (Kraken’s culture) has perpetuated marginalization. Lack of diversity within the builder-sphere is facilitating the development of less safe online spaces, such as in instances of assault and rape in Meta’s Horizon Worlds metaverse (TW).
Sensitivity to and action toward correcting these types of issues improves with increased discussion, diversity, and the empowerment of marginalized groups. Safe spaces are necessary to onboard people and for developing skills to thrive in the space so that we can create a culture of inclusivity that is respectful and reflective of values of equality and empowerment.
At the time of the writing (July 2022), we just witnessed two large crypto-related entities crash. The first is the Luna stablecoin, and the second is 3 Arrows Capital (3AC).
We debated heavily how deeply we wanted to explain exactly why each of these projects crashed. It gets pretty technical and is difficult to tell in a short form…so we will guide you here to learn about the Terra crash. And to understand why 3AC, and company recently valued at ten-billion dollars, was forced into bankruptcy, we will guide you here.
What we would like to say regarding these two stunning examples of failure is just how disappointing it is to see the levels of greed and irresponsibility related to these projects. Both suffered from smart leaders with incredibly big egos that got ahead of themselves, which contributed to the implosion of their projects and dragged down several institutions and crypto markets with them. A lot of people lost money. Businesses will be forced to shut down. Jobs lost. A stain on crypto and the leaders of these organizations will be dealing with governments and courts for several years and may face imprisonment.
Was it worth it? Hell no. And I really hope we as a space have learned that institutions and investors are taking note and that these mistakes won't be repeated. But when it comes to human greed, I don't hold much hope for this. I hope I'm wrong.
We love blockchain transparency. But sometimes, we think it's a little creepy. For instance, I have 2,500,000 unvaxed sperm tokens sitting in my wallet. These tokens (and a few dozen other questionable NFTs) were just airdropped (sent directly) to my wallet address. And frankly, no thank you.
I don’t like that anyone can just drop anything into my wallet without my permission. Extrapolate this into the hypothetical case where stolen assets are abandoned by blockchain criminals and just distributed to random wallets. In this scenario, you’re suddenly an accomplice in a crime you know nothing about. We have to do better than this. For starters, we need personal protections on wallets, like saying what can be deposited into them.
We are very excited for companies like Disco and others that take blockchain privacy seriously and can’t wait for the evolutions of blockchain identity mechanisms that give wallet holders more control over their on-chain activity.
While this is a list of our least favorite things, there are still plenty of things we absolutely love about crypto & blockchain.
Special thanks to community member @agreenwitch for her contributions to this piece.