A response to the 26 anti-crypto technologists

A response to the 26 anti-crypto technologists

Cryptocurrencies make big claims, but they have a small footprint. That's the way it should be.

One possible way to measure the actual size of the cryptocurrency industry could be square footage. It sounds bizarre, but this mostly synthetic digital asset class actually has a growing footprint.

The New York Times published an article about it on Sunday called "The Crypto Bros Are Snapping Up Manhattan Real Estate." The headline was more descriptive than the article itself, but offered insight into one aspect of this rapidly professionalizing industry.

"Crypto and related companies are believed to occupy less than one million square feet of an estimated 4.4 billion square feet of office space in the United States," the article stated. In addition, many real estate agents view potential tenants not as a risk that could go down in flames, but as "mom and pop" businesses.

This seems to be a healthy attitude. Crypto is risky, but for some it is a real economic opportunity.

Compare that to another supposed dose of reality: this week, a group of 26 concerned technology experts, writers and academics wrote an open letter to the U.S. Congress calling for "a critical, skeptical attitude toward [the] industry."

The signatories took particular aim at the grandiose claims made by some crypto vendors, as well as the predatory schemes that are rampant. This was to counter the crypto industry's increasing lobbying efforts in Washington, D.C., and frankly, it was largely fair.

"As software engineers and technologists with deep expertise in our fields, we dispute the claims made in recent years about the novelty and potential of blockchain technology," they wrote.

Reaction from the crypto industry, which was never just one voice, was also measured. Some noted that 26 people - even experts - cannot speak for a global industry. Others objected to certain phrases that set up the crypto industry as a straw man, such as the statement that "not all innovation is unqualifiedly good" - a claim that no one in the crypto industry has made.

And while the letter's authors correctly say that many crypto advocates have financial exposure to the asset class and are therefore biased, a similar claim could be made against them as well. Stephen Diehl, for example, a London-based software engineer and longtime critic of "public blockchains," has been drawing a paycheck from an "enterprise blockchain" company for years.

Other signatories worked or still work for large tech companies like Microsoft and Apple, which could theoretically lose out if the open-source ethos of cryptocurrencies challenges their market share and business lines around private software.

Furthermore, the assertion that applications for cryptocurrencies are "still unclear at best and non-existent at worst" is a fairly strong opinion that is not entirely borne out by the facts. Tools are being developed and used, Bitcoin has been running continuously for 13 years. It's just that crypto is thriving at the edges.

In many cases, cryptocurrency works exactly as advertised: a means for "censorship-resistant" transactions. The entire financial and cultural apparatus that is evolving around it should take this simple premise to heart. The problem is when crypto doesn't.

Vitalik Buterin, the co-founder of Ethereum, wrote a thoughtful post on Twitter in response to the letter. He was particularly upset that people he once considered "companions" have turned their backs on his network and the industry in general. He mentions science fiction author and journalist Cory Doctorow by name, but other open source advocates may also be involved.

Although Doctorow was once a soft proponent of cryptocurrencies, he is increasingly concerned about the financialization of the industry and the potential for cryptocurrencies to fund all aspects of human existence - turning friendships into sweepstakes and our public data into a monetizable product.

This is a real concern, in my opinion, if crypto's goal is "mass adoption." Blockchains were not designed for such use, nor can they be scaled to such levels with current technology. But blockchain - with its finality of transactions, irreversibility, and cost of use - is exceptionally well suited to ensuring that those who need it most have access.

The authors do not call for more regulation. However, that is the logical end game if cryptocurrency grows too large, especially if it grows at an unnatural pace catalyzed by venture capital and speculation by individuals.

You can agree or disagree with these claims or the 26 letter writers, but it doesn't matter. If they are addressing Congress or worrying about government retaliation, they have already missed the point. The true core of cryptocurrency is still there, even if it is surrounded by a speculative bubble.

The government was never meant to support unstoppable, fully sovereign transactions. Not everyone will want to use these systems, but crypto grows through voluntary adoption. Or, as Paul Dylan-Ennis said, it's about "cutting out" of the existing, problematic world.

"We can't fix everything, but we can live as if we were already free," he wrote.

Last winter, SubStack writer Casey Newton wrote about a "vibe shift" taking place in tech and tech journalism. While public or government interest in technology once focused on effective regulation of the big-tech giants, that now seems unlikely.

Instead, the trend is to think about how to build solutions from the ground up, on Web 3 and beyond. Writers, the public and government all have a responsibility to look at this skeptically, Newton wrote. But he also suggests "assuming that U.S.-led efforts to regulate technology will come to naught, and allocating reporting resources accordingly."

That's practical advice for an industry with a fairly small footprint.