There are no shortage of pie-in-the-blockchain promises being spewed forth from the self-appointed leaders in today’s Bitcoin space. “Presenting a revolutionary new way to use smart this to decentralize that”, or some variation thereof. Sound familiar?
Unless you’re so new to Bitcoin that you’ve never heard of BitShares, Ethereum, or Mastercoin, such promises should ring as clear as the Vatican’s bells on Christmas Eve. Anyone who’s “anyone” in North America’s Bitcoin scene is bleating at the top of their lungs about the promises of such innovations. Bitcoin-powered drones acting as Decentralized Autonomous Corporations that execute smart contracts to deliver GPUs from Amazon right to your 10th floor apartment balcony is pretty much the mashed up embodiment of this wet dream. It’s also as likely as flying cars and equally ignorant of reality.
Those of us interested in Bitcoin tend to be idealists. We imagine a brighter future for humanity by separating money and state, and in the process returning transactional privacy to individuals. Now that this appears to be fait accompli (even though it’s far from it), we can’t help but shift our collective sights to the next fantastical image of the future. And presumably, the next one after that as well.
Despite innumerable painful reminders, pie-in-the-blockchain promises are just that: promises. Butterfly Labs promised to ship your ASICs, Mt Gox promised to keep your coins safe, BitFunder promised to let you trade securities, and on and on and on. But would you, in your wildest dreams, pay for (much less blindly pre-order) a $15,000 car from a random manufacturer you’ve never heard of, just because they had a glitzy website, some Pixar doodles, and specs promising both 0-60 in 3.2 seconds and 200 mpg? Hell, especially if they made such audacious claims? As if! You’d only buy such a car, and such promises, from VW or perhaps Honda because you know that both of these companies have public identities with public executives and a long history of delivering the goods. This is normal logic that normal people have. Yet such logic is completely out the window in the Wild West of Bitcoin Greed and Idealism. Everyone with two bitcents to rub together thinks they’re an investor, rendering them gibbled prey to the wolves with slick websites and calculated appeals to idealism. Unbelievably, such wolves are consistently able to raise MILLIONS, even TENS OF MILLIONS of dollars worth of BTC, then walk away as if nothing happened. This is as criminal as it is preventable.
The solution: Due Fucking Diligence.
It’s hard to say how many times the Bitcoin wolves will be able to trick the Bitcoin sheep. Maybe there’s no limit. But time breaks bullshit. The fly-by-night operations and their skeezy operators will come and go, but their proportion in the Bitcoin Economy will continue to dwindle as legitimate players outwit and outlast them.
These are the very embryonic stages of something monumental. Rest assured that Mother Nature will weed out the useless mutants, just like she always does. So before you throw more valuable coins on yet another promising promise (eg. CoinTerra, NeoBee, etc.), consider more than just what’s being promised, consider who’s making the promise. If they’re anonymous or an unknown quantity, you’re “investing” with them in the same way that you “invest” with a wallet inspector.
Trust them at your peril. Because it’s all about trust.