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I was in YC during the same time as Coinbase (where I now work), and personally, I think cryptocurrencies are transformational. Having grown up during the Inter
by nemild 7y ago
I was in YC during the same time as Coinbase (where I now work), and personally, I think cryptocurrencies are transformational. Having grown up during the Internet era and hearing from my parents about the Mainframe -> PC era, use cases and viable businesses take time. Even founders in early, disruptive spaces have a hard time figuring out the use cases.
Here's my own thoughts on why rational people — and media — get disruptive markets (like crypto) wrong:
> As someone who had worked in banking and and microfinance, I got excited about the idea of credible digital scarcity, programmable money, and open financial systems. I didn’t quite know the use cases that would follow, but it was clear to me that the world would never be the same.
> Mostly though, everyone I respected thought cryptocurrencies were stupid. One MBA classmate haughtily wrote off cryptocurrencies as only useful for drugs and pornography. My old management consulting friends—all from elite American universities—pooh poohed Bitcoin and other open cryptocurrencies as they fixated on the needs of their lucrative banking clients. The vast majority of successful, rational people disdained everything about cryptocurrency.
https://www.nemil.com/crypto/rationally-irrational.html https://www.nemil.com/crypto/rationally-irrational.html
- larrydag 7y agoAdoption, per the article, seems to be the key driver for cryptocurrency in the long term. Right now it's hard to take cryptocurrencies seriously when its a wildly speculative commodity-like instrument of wealth. When cryptocurrencies are adopted in the commerce marketplace then we'll see its effectiveness. Do those in the cryptocurrency space see this a viable instrument for commerce or are they just happy to trade it like a commodity?
- nemild 7y agoWith the growth of stablecoins, there is an opportunity to prove out use cases that depend on stable value. Regardless, I do think there's value to smart contracts, even with a volatile/speculative currency: https://www.nemil.com/crypto/why-cryptocontracts-matter.html https://www.nemil.com/crypto/why-cryptocontracts-matter.html
- Yizahi 7y agoOf course stablecoins are useful - they are basically "dollars" without any additional regulations tied to real dollars, or at least have orders of magnitude less regulations. I.e. they allow for much more unregulated activities because "it's only tokens, not a money". And of course people will create more and more stablecoins because customers will exchange fiat money for random strings of digits.
- nemild 7y agoStablecoins are much more than that. It's the first openly programmable stable money, and can remove custody risk.
- lmpostor 7y agoCrypto is the gold standard of payment methods in several spaces already, I really don't see why it can't expand to more other than ease of use reasons. Imo it has to be a viable instrument for commerce, that is the core value that drives the speculation, even if 95% of the price is a result of speculation.
- jpm_sd 7y ago"They laughed at Columbus, they laughed at Fulton, they laughed at the Wright Brothers. But they also laughed at Bozo the Clown." -- Carl Sagan
- 0xfeba 7y agoSurvivorship bias. If I had a nickel everytime I saw that argument from some conspiracy nut...
- nemild 7y agoI very much agree. It's nearly impossible to know in the moment which it is.
- dralley 7y agoColumbus deserved to be laughed at. People of the time period knew how big the Earth was, and they knew that he would never make it to India like he wanted to do, and they were right. Columbus got lucky that there was a giant unknown land mass there (which he incorrectly thought was India) because if there hadn't been he would have starved to death.