Marketplace Economics
Perhaps the most significant criticism I see of crypto is the platform itself, how it operates or how exactly we’re going to get to the point of mass adoption and replace fiat. And is this even a good point to discuss as the basis for what Bitcoin is trying to do? Is crypto only about replacing fiat, and is that what the community should rally behind? I’ve been saying this for a long time, but the longer we focus on crypto as a replacement for fiat and not a substitute for services, the longer we’ll be fighting an uphill battle.
Arguments are won and people are swayed by the simplicity of the issues they can get behind. Movements in the past are often based on a simple case: equal rights for people of color, marriage equality for everyone, wealth disparity, being anti-war, and allowing women to vote. When we try to present the argument that currency as a whole should be replaced with a cryptocurrency, the questions we get are just too broad, and we have no unifying answer. To that end, I think the real focus the community should be embracing is Ethereum and platforms similar to it. Logistically, I believe that ETH will most likely be the long-term crypto that STICKS, just because of the way it operates. We’re able to break into people’s hearts and minds only if we cut the programming, and you can’t do that by attempting to change their operating system altogether. We have to roll out focused and small updates.
Ethereum at its core is very simple. It’s a marketplace for services. When someone asks why it’s superior to use over regular services, we don’t run into the types of questions that come up when we talk about replacing fiat with cryptocurrencies. We have reliable and straightforward answers. It’s a replacement because it allows for direct interaction between business-to-customers and business-to-business on a global level. It’s much easier to get behind a system like what Mercury Protocol offers for messaging or whatPublica does for publishing when we can solve these questions with easy answers.
Now we’ve moved away from the how do we get “X” to adopt crypto as a payment instead of fiat and into why would service provider “Y” use it. It’s a far simpler and focused issue than trying to get the entirety of the global economy and governmental structures to adopt a digital currency. I’m sure many of you have had that talk with someone when discussing BTC and can count how many times it’s boiled down to, “Why don’t I just use my normal money?” People need a tangible reason for why they should make a massive shift in their lives, and ETH offers this through its service market. These tokens provide a clear use case and, very often, reasons why they’re outright better than the current system. They offer features that don’t currently exist, make things easier to accesses, and often are cheaper to use.
Where ETH stands out when compared to BTC is ETH doesn’t require every single retailer in existence to adopt it. It can exist in its own ecosystem as service industries are attracted to it all on their own accord. Anything involving a transaction of any kind is likely to end up being better served, through both ease of use and security, let alone feature lists, on the Ethereum network. When exchanging fiat for Bitcoin, you immediately say, “Well, now do I really want to spend this? And even if I do, where can I?” This creates the holder mentality and the genuine fear of spending that is holding BTC back.
This holding attitude isn’t likely to happen in the long-run with ETH. Once dapps genuinely mature, exchanging fiat to ETH will often be for a direct service you would like to utilize through a dapp (and this isn’t even going into the insane achievement the ERC20 protocol is, but that’s a conversation for another time). For instance, you’re buying ETH to pick up some new books on PBL, or you’re buying VEN to track your products — these systems give people reasons to invest in the system to begin with, as it’s not just a currency-type swap but a direct service you’re after.
Let’s be real here. If you intend to convert all your fiat to BTC right now, you would have a hell of a time just keeping up with your daily and monthly purchases. BTC is not a better system than what’s the current standard, and it’s still likely a long ways off from being so. It’s not going to go anywhere anytime soon, but in the meantime, it might get left behind by services like ETH, NEO, or XLM, as they offer a here-and-now approach rather than a hopeful future free of burdensome regulation.
Decentralization’s future is a bright one, but I think it’s important we don’t get so focused on the light at the end of the tunnel, since by doing so we fail to see the blinking neon lights already present.
