Cryptocurrency is coming under attack.
Unlike the past, where governments took aim, we are now seeing this happen from a different set of animals. These, unfortunately, could be more dangerous.
With the eventual passage of stablecoin regulation, we are going to see Big Tech enter the arena. This see the entry of centralized entities such as Meta and Apple.
This is something that is of concern for Charles Hoskinson, the founder of Caradano.
When talking about the potential regulation, he said this:
“These are the barriers that, once removed, mean that Facebook, Microsoft, Amazon, Google, Apple and others enter the cryptocurrency space and tell me who owns their platforms. They do. That’s three billion users.”
Of course, for the price go up crowd, this will be applauded. Hoskinson takes a different point of view. He sees collaboration between extremely powerful entities through regulatory capture. This means that crypto is under threat.
Charles Hoskinson: Crypto Under Threat From Big Tech
The risk is losing the decentralized aspect of crypto. Hoskinson further adds this regarding Big Tech:
“So if those barriers are removed, how do we, as an industry, compete against the wallet that Apple built in bundles with the iPhone,” he said, adding that crypto also needs to build infrastructure that the incoming tech giants can leverage.
He is essentially calling for a revamping of the framework regarding tokenomics. The industry, thus far, is operating according to a zero sum game strategy.
“The problem right now, with the way we’ve done things in the cryptocurrency space, is the tokenomics and the market structure are intrinsically adversarial. It’s sum 0,” said Hoskinson. “Instead of picking a fight, what you have to do is you have to find tokenomics and market structure that allows you to be in a cooperative equilibrium.”
It is hard to argue with Charles Hoskinson. He is an OG in the crypto space, being one of the co-founders of Ethereum.
His vision of the future tends to be along the trend lines that are established. This means that he is fairly accurate in his assessment of how things are unfolding. Coupling this approach with his development skills means he has a firm grasp on the underpinnings of what is making the industry move.
Crypto Hijacking
For a while I stated how much of crypto was being hijacked. We saw this with Bitcoin. Since it is fixed money, and it is mostly acquired via purchase, those with money were the ones who would amass it. This is exactly what is happening as it is pooling in the hands of a few, mostly Wall Street.
Then we have the interest in Ethereum. This is starting to pool, albeit not as fast as BTC. We already see ETFs for the second leading cryptocurrency, something that will eventually lead to more products based upon this asset.
Now we have the idea of infrastructure. Hoskinson is referring to a built in wallet system that reaches billions very quickly.
Think of the prospect of Google, Meta, Amazon, and Apple adding a wallet system (Google and Apple already have it) along with their own stablecoin. They might not want to stop there. Perhaps they add the likes of USDC and USDT, both of which will come under KYC and AML regulations.
In other words, as Hoskinson was saying, there is a collaborative effort by the different parties simply due to regulation. When we add in the commercial banks. we can see how most of the stablecoin market is at risk.
This on top of Bitcoin, Ethereum, and maybe others heading down this road.
Tribalism Death?
It is hard to dispute that crypto is full of tribalism. Simply look at the post on social media platforms such as X. We see "wars" raging between the different tribes, for example Bitcoin and Ethereum.
This has transpired for years.
Bitcoin maxis believe Bitcoin is the answer to all, with everything else being a s*hitcoin. It is this mindset that is fatal. Sadly, these people do not realize their entire view of the future, in addition to being wrong, was completely hijacked. Michael Saylor, probably the top Bitcoin preacher after the death of John McAfee has slowly revealed himself to be nothing more than a Wall Street wolf.
Corporate structure and regulation forces Big Tech (and other players) to engage with each other. This is not the case in the decentralized realm. When people can do whatever they want, they tend to do that. Unfortunately, it is often to the detriment of everyone else.
Could decentralized crypto die via tribalism death?
Perhaps death is a strong word. A more accurate assessment might be the move to being non-relevant. By forging "circular economies", is there the risk of continually pulling from each other without the prospect of much growth?
Since I view many of these questions through the lens of data, is that really something that is growing at a rate to remain a player. Crypto is more than financial transaction. However, when it comes to this end of the spectrum, Big Tech clearly dominates.
Are we looking at a time where we operate under a hybrid system? Or is the future of crypto the hijacking by mega corporations, thus making Web3 nothing more than tokenized Web2?
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