Precisely ten years ago to this day, the largest bankruptcy in history was filed with the Southern District of New York in Manhattan.
Lehman Brothers had gone under, with a series of events unfolding to the point ATMs were about to run out of money. The west, itself, was facing bankruptcy.
Yet on the streets, in the homes, all appeared just like an ordinary late summers day. No cars were being burned, no streets were being filled with protests, only long queues of mostly old people at ATMs stood out as unusual.
The young looked to communism, to nazism, to discredited old ideologies, to untried new ones like ancap, to a solution and to an alternative of a political system which had now badly failed them twice, first in the Iraq war, and second in the banking collapse.
For many that solution came six weeks after the bankruptcy when Satoshi Nakamoto published the blue print of a new invention: digital money which can automatically operate without requiring banks or any third party. All you had to do was download a software (node), like any other software, and as if by magic you now have un-manipulatable money. Money which no one could counterfeit, legally or illegally, with maths the rules, code the judge.
It was probably in 2010-11 when most techies first heard of this new thing. In 2013 when most students heard of it, and in 2017 when bitcoin went mainstream.
Mainstream in awareness, but have cryptos succeeded in providing even a semblance of an alternative? The answer for now, almost a decade on, is sort of.
Bitcoin and ethereum in combination have moved $1.5 trillion worth this year. That’s a considerable sum of money, above the GDP of 180 countries.
Billions are moved daily by the two biggest cryptos, with funds sent anywhere in the world, effectively instantly, for almost no fee.
There is no other asset that can do the same, not even the digital dollar IoUs in our bank accounts. So cryptos do work, and do work very well in many ways, and have succeeded considerably compared to where they were even two or three years ago.
On the other hand, $1.5 trillion in the entire world for the whole year is not that much at all, but it is not far off from the amount Visa processes, which stands at $9 trillion for 2016.
Most of the funds Visa processes, however, are probably actual economic activity, while for cryptos at least 30% is movement to and from exchanges.
What the other $1 trillion moved for is unclear. At least some of it was to pay for goods and services with Bitpay processing one bitcoin transactions every ten seconds. Some of it was further used on dapps, with cryptos now handling some significant amount of real economic activity.
They’re not quite a reasonable alternative to banking, however, primarily because cryptos are in many ways at the dial-up stage. To bring the equivalent of broadband, Vitalik Buterin, ethereum’s co-founder, and his team, are working on sharding to significantly increase capacity. In bitcoin they are trying to improve a second layer transactions compression method in the Lightning Network.
Such refinements will continue, with gradual improvements potentially leading to cryptos becoming very convenient, perhaps even more so than banking and fiat.
In the meantime, awareness of cryptos may further increase, as may the distribution of its ownership, so making it easier for merchants and everyone else to accept them for payments.
In addition, the new dapps native ecosystem being built on ethereum may allow it to act as a unit of account. The third quality of money, store of value, should derive from the above means of exchange and unit of account.
Which means one can foresee in the near future at least one crypto becoming a proper currency at least to some extent.
In that regards, cryptos have succeeded. Perhaps considerably more than many thought they would have at this stage. Yet there are constrains which may be difficult to break with the aim of having cryptos as a real alternative if fiat does go south.
In particular, exchanges can be a chokepoint which most certainly would be utilized if capital controls are implemented. The way to do so is by simply telling banks to not serve crypto exchanges, as China and India has done.
Yet as both are finding out, clever cryptonians find many ingenious ways to bypass the restrictions, making it only a temporary set-back. However it would be preferable if cryptos were widely accepted so that the economy can have a backup if needed in situations like Venezuela or like ten years ago.
That may naturally, organically, and gradually occur by itself provided capacity is increased to handle demand which hopefully will be the case within two years.
The fact now ten years on the above can even be suggested, is in many ways a great success, yet realistically cryptos right now are not assisting so many that could be assisted.
The whole of Africa could leapfrog within months to a 21st century equitable digital financial system. The troubles of Venezuela could end in a day if only cryptos could handle the demand. So many bright young men and women would invent so many things in dapps and smart contracts, and they are.
Making 2018, and the next year or two, an incredibly unique time which comes only once in a generation. A generation that today might be seeing cryptos as the preceding one saw the internet. A generation that might be followed by crypto natives.
A generation that can look ahead 20 or 30 years from now and wonder of the many changes just this invention itself may cause, let alone everything else.
A generation that may dream of restructuring the entire financial system to work for them. Of taking back the now incredibly concentrated power and distribute it from the few to the many.
A revolution of a true sort, by the invention of code, which may have greater ramification than the printing press as the ingenuity of man keeps marching ahead in the pursuit of progress.