Rule One: The future is uncertain.

Still, it’s free to think about what might happen and today here’s the question we’re thinking about.

What if blockchain technology is just getting started? What if it’s opening day, top of the first, nobody out?

Caveat

There are smart people who believe that crypto is ridiculous.

Warren Buffett and his partner Charlie Munger say things like:

Bitcoin is ingenious and blockchain is important but bitcoin has no unique value at all it doesn’t produce anything. You can stare at it all day and no little bitcoins come out or anything like that. It’s a delusion basically. (Buffett)

Bitcoin is worthless, artificial gold. (Munger)

We can marginalize Buffett and Munger all we want. They’re old. They don’t get it. Whatever. But they are billionaires and they got that way by being among the most successful investors of all time.

Sure, they can be wrong like anyone. Buffett sold his airline stocks in early May of 2020 near the bottom and the Dow Jones US Airlines Index has doubled since.

There is risk.

The Early Bird

To many, Crypto still seems like a novelty and a plaything.

People don’t get a lot of basic things about it like there is no nation creating it, backing it, or controlling it.

People don’t get that there is no physical representation like paper bills or metal coins.

People see NFTs and they think it’s just a game.

One smart observer tweeted,

Ivan might be right, but his tweet reminded me of an essay written more than a decade ago by Chris Dixon titled The next big thing will start out looking like a toy. 

Dixon writes,

The reason big new things sneak by incumbents is that the next big thing always starts out being dismissed as a “toy.” …

Disruptive technologies are dismissed as toys because when they are first launched they “undershoot” user needs. The first telephone could only carry voices a mile or two. The leading telco of the time, Western Union, passed on acquiring the phone because they didn’t see how it could possibly be useful to businesses and railroads – their primary customers. What they failed to anticipate was how rapidly telephone technology and infrastructure would improve.

So maybe, crypto is not a toy, it just seems that way to many because we’re so early.

Some Things to Expect If We Are So Early

Let’s suppose that that’s the case. Here are some things to be mindful of if it is so early.

1. There’s going to be a lot of losers. Technologies and projects that seem promising today will get beaten by other better technologies and projects, some of which do not yet exist.

2. There will be big winners, probably larger than is imaginable as solutions arise that we can not yet fathom.

3. The volatility will continue. There are going to be more bubbles and crashes. We’ve already seen this and there will be more. In fact, Bitcoin’s resilience after bubbles and crashes may be a signpost that it’s so early.

4. The evolution will go on for longer than anyone expects. If Web 3.0 is really going to be a thing and global monetary infrastructure decentralizes, it will probably take a while.

5. We will eventually stop caring about and focusing on the technology. Applications will run on blockchain tech and nobody will care or even think about it.

A six year old doesn’t think about the chips inside a tablet. They touch it, swipe, and play.

6. Traditional hierarchical corporations will look very different than they do today.

7. Financial Institutions might get disrupted like crazy and the way people save, spend, borrow, insure, and invest will shift dramatically with fewer expenses. Access to financial tools will increase globally.

This will be great for consumers.

8. Expect the Unexpected. A lot of stuff will come to be that I can’t yet envision. Like we said at the top, the future is uncertain.