New financial system; a more democratized, even more inclusive, financial sector; the future of the internet – the crypto ecosystem has been described as all these things. However, as evidenced by the inherent correlation of digital assets with the Nasdaq 100, most people fail to conceive of a blockchain as anything other than an extension of the traditional technology economy. While the proponents of blockchain praise its virtues and potential, they have not been able to make a comprehensive case for blockchain to everyday people.
Many crypto natives anticipate “the disengagement,” in which digital assets become financially independent of traditional technology stocks. But without a clear action plan on how to differentiate decentralized crypto technology, the independence of the industry will be unrealized. Those of us who believe in the long-term promise of blockchain technology need to completely rethink how to introduce blockchain to a wider society.
Related: A new introduction to Bitcoin: The 9-minute reading that could change your life
What is “the disengagement”?
Bitcoin (BTC) white paper – published 14 years ago – demonstrated, at its core, the ambition to build a world of unauthorized, decentralized payments. To date, this goal has been partially advanced with developments such as El Salvador’s national Bitcoin adoption.
However, the cryptocurrency ecosystem has not replaced traditional finance. In fact, it has taken root in it. Turn on CNBC and you’ll hear about the newest legacy institution entering the crypto space, and you’ll see minute-by-minute charts of crypto price action along with models of traditional stock markets. You probably won’t hear any blockchain commentator or industry leader talk about improving financial transactions, removing third-party banking institutions or any other defining element of the original crypto ethos.
The result of this broad change in purpose and perception is that cryptocurrency – despite being established to reduce reliance on traditional finance – is growing and declining with the movements and behaviors of the traditional economy. Obviously, the Fed’s meeting memories and Amazon’s quarterly revenue calls have, at present, a much greater influence on the crypto ecosystem than anything exhibited in Satoshi Nakamoto’s white paper.
If cryptocurrency cannot be financially independent of the legacy financial and technical industry it seeks to replace, what is the purpose of cryptocurrency? Disengagement is not an industrial luxury – it is a necessary step for the survival of the industry.
Related: The significant shift from Bitcoin maximism to Bitcoin realism
How does crypto disconnect?
The wider community needs to acknowledge two things. First, you may not want your way into a new financial reality; the disengagement will not happen just because we want to. Second, it is said that madness does the same thing over and over again expecting different results. The stories that built a crypt to its current status have reached the limits of their influence; continued adherence to the same strategy will only perpetuate stagnation.
To fully disconnect, I propose three broad steps:
- We, in the crypto community, are making blockchain technology and storytelling more accessible;
- We focus on use cases with tangible real effects; and
- We emphasize the clear juxtaposition between crypto and its alternatives.
Accessible blockchain technology and stories
Slang is the antithesis of accessibility. Technically a complex language may be a mainstay in computing circles but, for the majority of the population, expressions such as zero-knowledge proofs, and a layered 2 interoperability protocol, could also be Latin. Ironically, for a blockchain to detach from technology, the experience of using it must be more similar to that of Meta.
Say what you want about Facebook and its sister products, but you can’t deny that they have become both indispensable for teens and addictive for grandparents – for a crypto to continue long-term growth, it must mimic this model built around accessibility. No one interfacing with Facebook is forced to understand the complications of its basic algorithms. They just type and scroll. This should be the level of intuition needed to interact with crypto. Crypt cannot belong exclusively to computer nerds; it has to make its case through society.
Related: In defense of crypto: Why digital currencies deserve a better reputation
Use cases with tangible real effects
The crypto community must decide whether a blockchain is a jacket of all businesses, or a master of some. While many are launching a blockchain as a universal technology capable of transforming entire industries, there is little evidence that a blockchain alone is a silver bullet for all of our current problems. At least in the short term, it is better to focus on creating real-world transformational change in a few key sectors rather than addressing a multitude of theoretical, yet unrealized, applications.
The use cases with the maximum potential are those at the center of Nakamoto’s white paper – the most fundamental for crypto natives: a monetary system resistant to government interference, a cross-border financial system accessible to 99%, and a new ownership mechanism. able to give people ownership of financial infrastructure. The rest is noise.
Juxtaposing a blockchain with its alternatives
The reason I entered crypto is simple: It has unwavering potential to improve specific, yet critical, aspects of our financial system. The vision presented by Nakamoto’s white paper – forged in the midst of an unprecedented financial crisis – painted a picture of an economically empowered society. While the greed of big banks created financial chaos, Nakamoto described a world where people, indeed, would be their own bankers. Using new blockchain technology, cross-border transfers could be made completely frictionless. Financial privacy could protect the savings of vulnerable people from major corporations and autocratic governments. Crypto’s essentially limited supply could protect against economically corrosive inflationary policies.
These core principles are central to the origins of a blockchain and are necessary to secure its future. We already see these principles in action. In El Salvador, Bitcoin institutionalization enables migrant workers to send and receive funds without charge transfers. In Ukraine, we have seen humanitarian donations flowing into the country with a blockchain faster than official state aid. While the story of crypto has been far from perfect, these kinds of use cases constantly remind us of how crypto can increase the economic power of the historically disadvantaged.
Rome was not built in a day; blockchain is still a nascent industry barely entering its teenage years. It has time to realize its potential. However, an inability to effectively promote its core merits will mean a lasting “connection” to status quo industries. Without disengagement, the founding ethos of crypto will be stifled by technological volatility, geopolitics and endless lukewarm commentary from CNBC speakers.
To save a crypto from this fate, we must duplicate what made it revolutionary first.
This article does not contain investment advice or recommendations. Every investment and business move involves risk, and readers need to do their own research when making a decision.
The opinions, thoughts and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Dennis Jarvis is an accomplished executive who is passionate about building people’s stellar teams and promoting economic freedom by adopting cryptocurrency. He brings years of experience from his previous global management roles at Apple and Rakuten as well as on blockchain startup Orb. Dennis joined Bitcoin.com in 2018 as Chief Product Officer, and became CEO of Bitcoin.com in 2020.