If you follow crypto banter on Twitter or other SM platforms in any capacity, you will have undoubtedly encountered not only the term "Bitcoin Maximalism" but also "Bitcoin Maximalists" themselves, this writer, generally speaking, being one of them. The term was first coined by Ethereum's Founder, Vitalik Buterin, in 2014, in response to the vitriol leveled against the Ethereum project during and after its launch. In his words, BTC maximalism is"the idea that an environment of multiple competing cryptocurrencies is undesirable, that it is wrong to launch 'yet another coin,' and that it is both righteous and inevitable that the Bitcoin currency comes to take a monopoly position in the cryptocurrency scene." Further, "it is a stance that building something on Bitcoin is the only correct way to do things and that doing anything else is unethical." While the article is certainly dated and has proven to be equally true for Ethereum, it is worth reading, if nothing else to get a glimpse into the mind and early motivations of the Ethereum founder whose work has had such a profound impact on this space and, increasingly, the world at large.
Though Vitalik has continually appeared to argue against the notion that crypto is a zero-sum game in which a single coin will eventually dominate the majority of the market and in the process sacrifice innovation and healthy competition that might further the space as a whole, his every claim is rife with disingenuous self-interest. How could it not? Notwithstanding the messianic claims made by tech billionaires who are endeavoring to colonize Mars on behalf of humanity, no one person is "completely" altruistic. Humans are hardly altruistic at all, in fact. Anyone even remotely passionate about a certain idea, field, project, industry, or belief and is daily engaged with the furtherance and development of such will, when all is said and done, eagerly want to "win"; "win" here meaning: the complete and utter domination of their endeavor, project, or idea over and against all other competitors. That such individuals pay lip service to the notion of a "fair playing field" or "equal access for all" merely indicates that they have not yet achieved full dominance in their field. When they do, however, their moral impetus will always begin to echo the sentiments espoused by the late John D Rockefeller when he said, in reference to Standard Oil's dubious business dealings that led to its monopolization of the early oil industry, "competition is a sin". Consider the similar monopolizing tendencies of internet search engines, social media giants, online and retail commerce businesses, politicians, authoritarian regimes, and others. Does Wal-Mart care if small-town general stores survive? Unlikely.
I'm belaboring the point: no words of any founder of any project, crypto or otherwise, can be trusted as objectifiable, unbiased fact. Parents will always be blind to the defects of their children. Crypto founders know they have the power to pump their bags with every word that comes out of their mouth(s), their words which will always be bullish, hopeful, and even hyperbolic. And if the words of founders should not be trusted, how much more their myriad "followers" (to say nothing of their "promoters") who know absolutely nothing and can make no reliable predictions whatsoever about where this market might be headed (this writer included), whether those followers place their trust in Bitcoin, Ethereum, XRP, Cardano, or whatever shitcoin is enjoying its 15 minutes of fame.
Nope, no one knows anything. Period - least of all me. It's all speculation and should be treated as such. My belief that Bitcoin will "win" stems from my experience with this ecosystem, my study of its various projects and the addressable markets that each one is trying to reach, my skepticism toward those who have a certain vested interest in the success or failure of a project upon which they are making their claim, and also my general observations of the overall financial market, geopolitics, history, and finally my years-long contemplation of human nature and society, of which has so far produced three works of philosophy, two and a half novels, poems, short stories, vignettes, and this newsletter. Others have different perspectives, as they should, and different motivations. Mine, as I've said since the beginning, has always been to steer those of you who might find themselves lured, willing or not, into the crypto market in the safest, most secure, and reliable direction with the longest time horizon possible.
Forgive my need to qualify all of that before I make the following admission: I am slowly losing my bitcoin maximalism. That is not to say I think Bitcoin will fail to win the crypto race because I, in every way, believe it will. I'm simply saying that if it doesn't, what does it really matter? I plan on pulling out my initial investment in a few months anyway and from there will simply let it ride. In the end, crypto is just money. And money isn't all that interesting. Further, I do not want to blind myself to truly interesting developments currently underway in this space simply because I'm an ardent skeptic.
Maximalism, whether of bitcoin, Ethereum, altcoins (or physical gold) often originates from a place of financial and sometimes social insecurity as well as general alienation from the accepted norms of our society, and also bitterness acquired through years of scams, ignorance by newcomers, false promises, failed messiahs, and manipulative tactics, and finally, good ol' fashioned pride. It tends to manifest as a kind of libertarian self-righteousness that posits savers as "good", while spendthrifts, or anyone who blithely believes in and deals with fiat, as unequivocally "bad". Bitcoin maximalists genuinely feel they are providing a service to newcomers in their attempts to dissuade them from scams and false hopes peddled by shitcoin promoters. It makes them feel good and even powerful too. They preach to every "noob" who will listen to avoid their mistakes and to shortcut the necessary crypto investor evolution by quickly professing allegiance to "the one True Coin", meaning, avoid Ethereum, altcoins, Defi, NFTs, and anyone who might even obliquely promote such evils. And because their pleas often fall upon deaf ears, it rouses spite toward those same "normie dumb-dumbs" whom they were originally trying to protect. For many in the crypto community, Bitcoin acts as a surrogate religion, one replete with its divine founder (who miraculously disappeared "for the good of all"), its bible (the bitcoin whitepaper, The Bitcoin Standard), its saints (Andreas Antonopoulos, Hal Finney, and others) its proselytizers (Max Keiser, among many), its hollowed dogma (Bitcoin Magazine,among others), its fanatics, true believers, heretics, and, most importantly, its moral crusade to rid the world of those menacing fiat currencies that have brought untold vice and misery upon the world in the form of inflation, manipulation, war, and all the many consequences that result from perverse economic incentives. To many Bitcoin maximalists, BTC provides not only the "why" of a moral and ethical life, but also a "how": hold your bitcoin, never spend, dollar-cost average, don't use leverage, don't trade for shitcoins, don't keep your coins on an exchange, "not your keys, not your crypto", centralization is bad, trust is stupid, become a libertarian, and only look to bitcoin as the answer for humanity's future survival. Similar beliefs are held by the Ethereum Community, the XRP army, Cardano Holders, Bitcoin Cash folks, and virtually every project on the market today, to a greater or lesser degree. Even Dogecoin has some hardcore holders. What's more, being an active member of these groups - which usually comes in the form of a social media troll - gives adherents a sense of belonging and community which the internet and its facilitation of the digitization of human life have eviscerated from the human experience. Thanks to its catchy and easily accessible slogans, it doesn't take much to pick up the bitcoin mantle with the intent to bash some people on Twitter for highlighting an interesting development of a project other than bitcoin. A feeling of vindication, then solidarity, and finally group inclusion c- their "group", of course, the most seasoned, battle-hardened, wisest, "grounded", and ruthless in the crypto domain, which is to say, the only ones who are "right" (and by extension, "good").
I am not insinuating that I've had a change of heart toward Bitcoin and will now invest in a bunch of shitcoin pump and dump schemes promoted by Youtube influencers - far from it. But I have, over the last few months, softened my stance to thepossibilitiesthat this ecosystem is at least experimenting with and beta-testing. How can onenottake Ethereum, now a $465 billion - and well on its way to a trillion-dollar - market cap, at least partially serious. Yes, its business dynamics, founding, promotion, centralization, VC investor base, and scammy tendencies are still firmly rooted in the dying fiat world with all its perverse incentives, but they are nevertheless doing interesting work that most probably would not have originated on the bitcoin blockchain. Surveying the crypto influencer landscape, I am not the only maximalist making this transition. Many are softening, if nothing else, their utter disdain for anything and anyone who might find a non-bitcoin project interesting.
Now, whether those non-Bitcoin experiments find a final home on Ethereum, or Bitcoin, or some other place, what does it matter? All the better that someone created the thing and more power to them - if it works. I am doing my best to not reject certain ideas out of hand, the most notable being Non-Fungible Tokens (NFTs), a rapidly evolving topic I am currently exploring and will write about in more detail in the months to come. Perhaps this softening of disposition is the next iteration of the crypto investor which, as I have outlined in the past, progresses like this: you start with bitcoin, then move to eth, then shitcoins, you lose lots of money and then move back into bitcoin where you park for a few years, study, self-educate, become convinced that bitcoin is the only way and everything else is garbage, and finally - now equipped with the necessary armor or skepticism, saltiness, and education - begin to pick through the garbage to see if there be anything worth salvaging. In fact, to undergo this entire evolutionary process is vitally important if you are actually going to endure as a savvy crypto investor.
It is easy for me to write about certain trends that are transpiring in society at large and yet fail to take a step back so as to see the forest from the trees - the "forest" in this case being the digitization of human life: that which was first initiated en masse via the global adoption of the internet which changed the nature of communication and also democratized access to information forever. Bitcoin is "simply" the digitization of value, wealth, and to a certain extent, time. And the introduction of digital scarcity, formerly an impossibility. Digitization ofeverything is inevitable. Thus, to believe that the digitization of the world will only have one "winner" is a mistake. World Digitization, I'm sure, can accommodate many projects other than Bitcoin because blockchain technology has more applications than money alone. In truth, as I've said many times, it would benefit Bitcoin as much as altcoins if the two were completely separated, both conceptually and practically speaking. One does not lump real estate and crude oil in the same asset category. Their distinct use cases, stock-to-flow ratios, markets, and geopolitical dynamics render them uncorrelatable for the most part. I think this crypto separation will happen in the next 4-6 years, but in the meantime, one can make the distinction in their own minds and investment portfolios.
Again, Bitcoin is the reserve currency for the entire crypto market. It is money, security, stability, digital scarcity, and it will soon be treated as such on the world stage, if not already. In the not-so-distant future, Bitcoin will transform into digital real estate upon which entrepreneurs will develop digital businesses, digital goods and services, a new, decentralized, and fully encrypted internet, and many more things we can't yet envision. Altcoins, however, are not bitcoin and should not be treated as such. They won't win against bitcoin at bitcoin's game but bitcoin would not necessarily win at their game either. What is important, of course, is that crypto should be allowed and even encouraged to play whatever game it will, and people should be allowed to also bet on who will win. Again, one can easily call Ethereum and its knock-offs "tulips", but how can you not take altcoins at least a little bit seriously. A lot of people have, will, and do - and they "can't all be wrong", can they?
Of course they can, as in the case of Netscape, Yahoo, AOL, Myspace, and innumerable online businesses during the DotCom bust. To hedge against such a probable bust in crypto, Bitcoin should always be your digital reserve asset. It's the surest thing and if there is one winner - King 'Corn will be it. Ethereum is the safest speculative play. Because it is not as mature as Bitcoin, it will continue to see a lot of volatility from now until wider adoption and it thus provides the most secure way to increase your bitcoin holdings, if you time its moves correctly. There are considerable risks involved, as I've explained repeatedly, but I don't think they are imminent. What's more, the power of Ethereum's network effects is undeniable. So much is being built upon this platform that its failure would cause significant chaos far beyond the insular world of crypto. The rest of the market is either a highly speculative Ethereum smart-contract knock-off (Polkadot, Cardano, Solana) or an Ethereum derivative so there's no real reason to hold any other altcoin in the long run if you want to sleep soundly at night. Decentralized Finance, currently being built on layer 2 Bitcoin by Jack Dorsey's Square but already proven on the Ethereum blockchain, is undoubtedly here to stay. Though my experience with decentralized lending and borrowing has not been a positive one, I am sure there will be demand for it in the future when user experience improves. It will eliminate the need for banks. Period. Non-Fungible Tokens - also built on Ethereum - while indeed simply "jpegs" sold for millions of dollars, are, to me, the most interesting development in this entire ecosystem. Perhaps, as an artist, I want NFTs to succeed so as to benefit the artists and writers who mint their work on the blockchain. Perhaps it's something more, though, who knows? Perhaps it is the first iteration of the much anticipated decentralized web.
My advice is to approach the market with a skeptical mind, but an open one. Obviously, don't put money into something you don't understand or that has been inaccurately and poorly explained. The last thing you want to do is invest simply because others are. The space is moving too fast for any one person to feasibly keep up with and you don't want to be left holding a worthless jpeg when the market moves on. But because the digitization of human life is unavoidable, it would be financially short-sighted not to explore this future before the rest of the world.
Parting Note: I was interrupted by a nice gentleman today who tried to sell me on Cardano and Solana as being "the next big things". (Little could he have guessed the response that was in store for him, poor guy. Haha). Before parting he said, "can I get on your newsletter?" Indeed, the bubble is inflating...
Good luck to you all.
NSV