Once people dreamed of owning one million dollars. Then someone said one million is not cool. You know what’s cool? One billion! Now some say one billion is nothing. One trillion!
That’s inflation in action. Every single day, our money is devalued. The fixed wages we receive every month are worth less every month. In a cruel combination, house prices are worth more and more.
It is no wonder a generation is peacefully revolting. A generation that uniquely has seen a decade of global peace and prosperity in the 90s, then two decades of war, followed by depression.
From China to America, Russia and Arabia, as well as in the ancient continent with the country that once ruled the waves, the millennials are metaphorically packing their bags, turning off their TVs, quitting their jobs, and are joining a movement to transform the world not by gun, nor by pen, but by code.
“This is a typical story: I got out of college, I moved to Silicon Valley, I want to do computers, I got a job at Facebook, I’m five years into it, I realize that if I’m lucky I will increase the conversion rate, for whatever advertisement, by like 0.1%, and this is not how I want to spend my life.
I started hacking on Solidity on weekends, and ethereum, you know I fell in love. This is why I moved out to the west, this is the frontier, this is the wild west, this is what I want to do.”
Few more powerful words have been uttered in our years of reporting in this space. The hearts and minds, but more than that, the excuse and the means to dream.
To dream of building a better world, a fairer world, a more equitable world, a world where discriminatory laws based on wealth do not still stand in our congress, a world of equal opportunity for all, a world with meritocracy alone as ruler of all things.
A world we have in this space, at least for now. Because all this is so new, there are no guilds, there are no barriers. Laws too, apply here, only in as far as they are reasonable. Otherwise, its global nature gives freedom.
And what has been done with this freedom? Well, the simplest and first application was money. Decentralized money. Yet this money had the problem of being volatile. Up 70% one day, down 30% the other.
A problem with no real solution until ethereum came along. Eth is technically money, but not really practically. It was never meant to be. It is only a fuel that powers one of the most powerful network on earth.
The price of that fuel can vary based on many considerations, and the point of that fuel is to power applications. One such application is money itself, but not as we know it. It is a different take, and a very fascinating take, called stablecoins.
Dai is a decentralized token currency that is pegged to the dollar, for now. If it really takes off, and as far as we can recall, their aim is to algorithmically measure the different price changes of goods with the aims of maintaining the value of Dai at a level that roughly buys you the same amount of goods today as next year or next decade.
That idea is the brainchild of Hayek, and its implementation is not quite here yet, but what Dai has managed to achieve is fairly impressive.
In a completely decentralized manner, without ever touching the dollar or fiat money, they have been able to maintain a value of precisely one dollar for now four months.
They use ethereum as collateral, or backing, and through complex algo they in effect turn very volatile eth into very stable dai. Dai itself is of course decentralized, a crypto, like bitcoin or eth, but stable. Thus creating the first fully practically usable decentralized money.
From the simple, to the very complex. Geopolitics. Some still dream of peace on earth even in the face of eye rolls. Would a world where national money can not be manipulation either by national governments nor foreign governments lead to such peace?
Who is to know, but something pretty historic has developed in the past 3-4 months. Venezuela’s issuing of tokenized bonds backed by oil through an ethereum based token that can also act as money is really the beginning of a very new era.
Iran has also stated they are to issue a national crypto, but based on the latest news, what they seem to mean is a token, probably an ethereum based token, which is to be backed by assets, Venezuela style.
That’s a significant challenge to the current global financial system for it in effect places sanctions on a shelf-life. Maybe not quite yet irrelevant, but soon probably pretty much so.
In the middle of this simplicity and complexity stand the many other applications. Web3 has the ability to re-imagine the internet. Dapps can re-imagine many things, including such innocent aspects like art or sports games. Tokenization will probably engulf everything. The stock market itself will probably become natively digital. Industry, from cars to supply chains, will be digitized and blockchenized.
A new world of wonder and utter complexity that will force men’s evolution to higher intelligence through education perhaps until the age of 30 may be envisioned.
And in that world, where national money runs on eth as well as all else, to ask whether eth will be worth merely 1% of the global stock market might begin to sound like a rhetorical question.
Delusion here might be to ask whether it will be worth $10 trillion, but of course there is risk. There is risk because eth isn’t quite ready. When one bets on eth at this stage, what they are really betting on is whether boy genius Vitalik Buterin, or some other eth dev, will crack sharding.
The solution has been conceptualized, the digged foundations have even taken a code form, but until sharding is implemented, which will give ethereum an initial capacity of 1,000 transactions per second, everything is sort of on hold.
People are still playing around, of course, there can still be the simple ms paint like applications, one still needs to do the studies and the pilots and the prototypes and the refinements and so on.
But once sharding is implemented, then ethereum will finally be ready at a technical level for mainstream usage and it would be the only decentralized public blockchain to truly so be ready.
At that point we might see the biggest boom in innovation for history to document. For finally, there would no longer be constraints.
Then it would truly be 90s, when young men and women are randomly introduced to a world where they don’t just buy and hold, but use things that run on smart contracts, run primarily on eth, and things that some of them build.
Right now, it is still the 80s, perhaps late 80s, that moment when the great wall comes down to greet the world with a peace dividend.