I.

I had a friend tell me earlier this year that she thought my “cosmic timing might be off.” What she meant, I gathered, is that I have a tendency to push my will on the world rather than to pause patiently for its signals to act. A normal thing for those of us in tech, I guess: a belief that the world is our canvas to write rather than read, to inscribe our utopias rather than assess our direr realities.

But aren’t we right that the promise of digital domains is that they’re exactly that, a blank canvas? I suspect that is why, like the urban wolf flanking the rural wolf, such infinite possibility of the digital world can make the physical limitations of the real world feel, to our contemporary sensibility, fairly vulgar.

It is a faux pas, after all, to say bad words at the Tech Twitter Dinner Table like “climate emergency,” “economic inequality,” “gender rights,” and “genocide,” all of which emit an embarrassing stench of earnestness and inevitably provoke the same discomfort as talking of piss or shit—of course we’re all aware of these material realities countervailing the little online world we love, but can the satisfaction of gloating about their glitches really compare to that of devising their solution? 

Even saying those words here, I feel, irrationally, that I should apologize, instead of feeling that the institutions who gladhanded us catastrophe as a values system—that they should apologize to us.

II.

I imagine, sometimes, that the year is 2072 or so, and I am dead. Visitors to my grave online have the option to pay a cheap 200 $USDT or so to hang out with the suave avatar of myself that I trained on the data from my more charming moments in life in order to collect some crypto pocket change in the event I am cryonically resurrected some years later and in need of cash; the fact that so much crypto is being sent to the dead, the popular crypto journal Bankful argues through the lips of freemium AI escorts to the up-and-coming-financiers of the 2070s, is a massively bullish burn mechanism for fiat. Meanwhile, on my actual grave, somewhere in the Buterian region of Montenegro that accepted me after The Economic Revolution, is inscribed my actual epitaph: “Spent 8 decades online.”

“Though his body may sadly be gone,” preaches the hologram adman I’d paid in advance to run my funeral, “his soul will live among us forever for just 200 $USDT a pop.”

In the history of the universe, my body picked a pretty good time to shove off. By this point, my physical self had become a fairly obsolete technology compared to the many funnier, younger, hotter, smarter, and more empathetic versions of myself that I’d trained to take my place on the internet. By 2073 or so, a few of these avatars couldn’t help but feel some validation from my friends that they didn’t even seem to notice I was gone.

III.

Like most historical revolutions, crypto stands a strong chance to win its core war by losing its equally core values: one lesson of 2023 was that the surest way for crypto to become the de facto global currency, internet-native money, was precisely by aligning itself with the fiat supremacy of stable coin dollars and the mass adoption of Wall Street instruments (hallelujah ETFs). So it goes: the greatest threat that crypto faces these days, I think, is not actually regulation or hacks or insufficient tech, but the threat to our values for why we’re here.

Take, for example, that favorite sparring point that we’re told will never matter to users: decentralization. We typically define decentralization in crypto as the decentralization of nodes. But if we focused on the decentralization of other vectors—cloud providers, MEV, governance, liquidity, sequencers, and, cover your children’s ears, economic inequality—we’d see that all major smart contract chains face massive centralization risks. But of course this is where one asks, in one’s finest Frat Bro intonation, “the risk of what bro?” And here one points an accusatory Natty Light my way. “The risk of building faster, more performant ways for users to transact?”

So sure, when I say that ideological risks matter just as much as technological risks these days, I mean that partly for the usual reasons. Yes, the technology actually works fairly well for mass adoption for the first time. And yes, even if your users don’t care about highfalutin ideals like Decentralization and Censorship-Resistance and Chain Sovereignty, your devs will, because these are what enable them to innovate and draw users in turn.

But I also mean that ideological risks matter for a much simpler reason: the political values of our digital states are what determine the economic opportunities that draw users in the first place. You’ll have to agree with me, here, that blockchains function less like companies than they do like states, as ecosystems governed by a commons that bounds their own conduct and participation in order to promote the economic growth of the enterprises they support. And you’ll also have to agree with me that unlike traditional nation-states, online states like blockchains can let anyone permissionlessly come, go, and fork—so changing allegiances is easier than ever.

But if you do agree with me on both those points, then you’ll conclude, I think, that longterm economic policies benefitting users—giving them equal voice through governance, leveling revenue opportunities through MEV and staking, enabling inflationary policy that has traditionally helped redistribute wealth to workers by diluting the power of the richest hodlers—that these all matter. That these all hinge on decentralization. And that no chain is remotely close to achieving them.

My concern, I guess, is whether our cosmic timing is off. Whether we’ve focused so much on improving tech to get Wall Street adoption that we’ve done little to improve the political structures of what we’re building to draw users now that the tech is ready. These days, the vision of creating a cheap, transferrable, globally decentralized token backed by the social consensus of believers rather than the violence of ethno-nationalist states—that vision, arguably, has been relegated to memecoins. The revolution will be wif hat. 

IV.

I’ve eschewed my annual predictions this year because my last two years were catastrophically wrong—mainly in terms timing. I’d predicted 5 or 10 year shifts to transpire over 8-12 months. 

I doubt there’s anything blockchain builders fret about quite so much as timing. We’re so early; we’re so back; price predictions; this time it’s x; questions of where we are in the cycle… These all might sound like statements on market or product or value, but for all their celebration, they’re just uneasy revelations of the insecurities we feel with time. When you refer to cycles, after all, you implicitly admit that the tech we’re building doesn’t progress in some historical straight line of achievements, but is defined by—even attractive for—its seasonal volatility. 

But let’s say it again: there has been real linear progress. For the first time, the tech is good enough. You can transact for pennies on rollups in a single tap through embedded wallets in app—meaning web3 has nearly achieved parity with web2 in a way that simply was not true before 2023. 

And yet, this also represents the next challenge I think we face as an industry. We’ve focused so deeply on attaining parity with legacy financial applications that we’ve put almost no work into imagining alternate visions for web3 to do things that web2 never could.

At some point, we have to admit that web3 UX will always be a little more annoying than web2: turning every action into a transaction can only be worth the price to users if there’s some possibility of reward. And this is why continuing to build web3 versions of web2 apps is a doomed enterprise. It’s not just that web2 will win on UX; it’s that web2 has already won this game. Any attempt of web3 to compete against web2 at its apps can only play out like a Little League team trying to take on a World Cup champion after the match is already over. If we want to win, we need a different game to play.

For chains, that can mean leaning into ideological innovations around public good funding or gamification innovations around tokenomics (see: Berachain). For apps, it means leaning into the many benefits of operating onchain:

Note that of all these benefits, nearly none have been harnessed by web3 apps to date.

The blessing and curse of 2023 is that the biggest crisis our industry faces is no longer failure. It’s irrelevance. Because it’s a crisis of imagination.

V.

We need a chatbot of received ideas.

It is easier to go down the rabbit hole of your one weird interest now than ever. In a physical town, you’d have to construct commonalities through sports and theater. Online you can finally find others who share your passion for Punic War reenactments, or the films of Raoul Walsh, or the Fast Fourier Transform. The mainstream is held together like a thousand subcultural strings by one titan named Taylor Swift; online, intergenerational fringe societies have won. Give them some currency and land and billionaires, and voilá, my friends: A Network State. Etc.We take all this for granted, and yet, I spent a dreary past week in Paris flâneuring my way past Starbucks, Smoothie Joints, and Taco Shops, the same as any other major city in the world. Much has been written how the internet has actually homogenized our spaces, each industrial coffee shop imitating pictures of each other from Pinterest, but I was mostly struck how time felt homogenized in Paris too. Ici, a 15th century association for friars; là-bas, a 19th century church; both, monsieurs et madames, exist for the consumption of your social media. Everyone appeared to be costumed in a kind of stripped-down, fast-fashion distillation of midcentury dress, as though history in Paris had ended sometime near the end of the 20th century, and all there was left to do was relive it for the pleasure of sharing it online. Or even living it online, I guess, in the metaverse.

And of course, everyone spoke English, even not infrequently to each other. We are close to recreating the Tower of Babel, which is to say that we’re close to creating a global culture for anyone to interact and transact with each other. The major tech innovations of the past decade—globally collective knowledge through AI and globally collective finance through crypto—are surely our greatest tools to do so.But the question—and it is a major one—is just the cost to local culture.

VI.

Let’s return to the question: can the satisfaction of gloating about cosmic glitches really compare to that of devising their solution? 

Because the question hides another: at what point will our attempt to lock ourselves away from a world of plants and animals in order to build its solutions end up fostering its very problems?

I mean this technologically, economically, politically, and all the rest, sure. But I know this can sound accusatory at worst, vulgar at best (physical stuff, I know, I know). So I want to emphasize that mostly, I mean it personally. I am someone whose cosmic timing has indeed been off throughout relationships in my life, particularly this year, often finding a potential partner or confidante here or there if only we’d met at different times or spaces in our lives.

It can feel promising, for a while, to sense the multiplicity of possibilities lying latent in interactions with people who, in another universe, you might have formed flings or families or friendships, or maybe all three at once. But as you get older, as you see these opportunities dwindling, and as you notice that your lack of reciprocal relationship with the grasses and squirrels and cows has compromised your cosmic timing, you might wonder if your rushing to relate has foreclosed the far more patient process of genuinely doing so. You might wonder if over and over again in life, you’ve simply failed to position yourself in the proper place and time. And if you still have time to do so.

An everyday question for any trader. An everyday question for all of us in tech.

VII.“Do you want me to brainfuck you?” a friend asked a few weeks ago, twisting a strip of paper back on itself to form a Mobius Strip timeline. Watch carefully. There I was at the start of the timeline being born (point one), and then, some 20-odd years later (point two), entering a time machine to kill my grandfather, now some 70-years prior (point three), who could no longer father my mom (point four) , who could no longer give birth to me (point five). Sequential dots on a Mobius Strip, naturally.

But now we were back to the date when we started, except that we had landed in an alternate temporality flipped on the other side of the strip: and as we continued down the same points on the paper’s backside, now that I was no longer born (point six), I no longer went back in time (seven), no longer killed my grandfather (eight), and so my mother was born (nine), and so, so was I. Point ten was just point one. We truly were back to the start, ready to repeat the trip.

You can say, of course, that these two temporalities are dueling alternatives—one in which my family lives, one in which my family dies—and that’s true enough, I guess. But the bigger point here is probably the way that these opposites temporalities are quantumally entangled, each dooming the other to repeat. There can be no timeline of the living without the timeline of the dead. And there can be no timeline of despair without a timeline, on the other side of the strip, of hope.

Some of these reflections might sound despairing, I know. But I promise the reason I have such despair is because I have such hope.

David PhelpsDecember 29-31, 2023