We all remember what the 2008 subprime mortgage debacle was like. The situation was so destructive and almost brought down the global banking system that words like subprime mortgages, credit default swaps and collateralized debt obligations — which are normally part of investment banker’s jargon — became part of the general vocabulary.
Because of this in 2009, Satoshi Nakamoto released the very first Bitcoin genesis block, or block zero. Embedded in it was a quote, “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” This was roughly at the same time protests to “Occupy Wall Street” displayed the public’s anger against the excesses of traditional finance.
If you think about it, with all the problems of the banking industry, the crypto industry could have taken advantage of the animosity against traditional finance to increase public adoption. Unfortunately, crypto is a tribal world. Often we are treated to the spectacle of competing chains badmouthing each other, of well-publicized blockchain projects like Terra Luna, Celsius and FTX/Alameda blowing up spectacularly with many investors wounded.
Yet with all the mudslinging going around the various crypto tribes, try asking people on the street what a blockchain or crypto is. Admittedly, there are already many who are trading it, but even those who buy it on a regular basis might not really conceptually grasp what a blockchain is, which is a replicated data structure that keeps a history of all transaction records.
Instead, what the public thinks of it is based on fraudsters, scammers, “pet rock” labels, soundbites from the likes of Warren Buffett and so on. Clearly, much needs to be done to clean up its act. Simple explanations, and not buzzwords like on-chain metrics, FUD, FOMO, WAGMI, HODL, etc., would really help.
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Contrary to what some may think, regulation will be good for the industry. Along with AI, electric vehicles, nuclear fusion and other new technologies, crypto and blockchain should be viewed positively by the public for their benefits. Some of these benefits include cheaper remittances, secure records, cheaper cost of transactions, banking for the unbanked and so forth. Instead, it is getting the cold shoulder at the moment.
Crypto/blockchain needs to break away from its early anti-establishment punk days and association with seedy sites like The Silk Road. Instead, it needs to be associated with the needs of the common man, but also with hedge funds like Blackrock, sovereign wealth funds and exchange-traded funds, to smoothen out the variabilities from retail investors.
Sometimes we are so engrossed in internecine warfare among the chains and tokens that we fail to realize the regular folks who have no idea what we are talking about. Remember: traditional finance could lose trillions if crypto and blockchains take over their business the way they normally do it.
Any win of one chain against other chains is just a Pyrrhic victory for the entire industry if everyone sinks together. Traditional finance and the media are just laughing and watching us burn our own ships.
Zain Jaffer is the CEO of Zain Ventures focused on investments in Web3 and real estate.
This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. Opinions expressed do not necessarily reflect those of Cointelegraph.
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