Last month, cultural critic Alison P. Davis published an article in The Cut titled “A Vibe Shift is Coming. Will Any of Us Survive It?” (A change of vibrations is coming. Will any of us survive?). The “change of vibes” that Davis was referring to had nothing to do with cryptocurrencies. He was referring to a radical change in pop culture and social trends, especially in view of the current rise of Generation Z in the realm of trends and cultural relevance. However, his positioning caught my eye because he rightly put his finger on something crucial that I too have been feeling, particularly when it comes to cryptocurrencies. The paradigm shift toward the next cultural moment—whatever it may be—is perceptible, if not palpable. We can’t tell it apart, but we know it’s in the air. The concrete conditions have not changed yet, but the atmosphere has.
In the days following its post, the “change in vibes” garnered Twitter attention and, in many cases, derision. As silly as the term is, it captures something real and similar going on in the cryptocurrency space. As ridiculous as it may seem at first, there is a change of vibes in cryptocurrencies.
I like the term “change of vibrations” because it is exactly that: a feeling, a hunch, a state of mind, a tone, a vibration. Throughout its short history, changes in the vibes of cryptocurrencies have followed changes in the technology itself. Cryptocurrency’s early “wild west,” where anything went, grew out of Bitcoin’s (BTC) transition from a peer-to-peer (P2P) payment solution to a store of value, and then got even more frantic with the introduction of Ethereum, which demonstrated the potential of smart contracts. This half-maniacal optimism became more serious and entrepreneurial as decentralized finance (DeFi) expanded at the expense of legitimate Tier 2 networks. The development of non-fungible tokens (NFTs) brought the artists and musicians into the fold, and not the other way around.
This is not a good or bad thing, it is simply a fact. Technology determines the discourse in DeFi and cryptocurrencies, which means it also dictates the culture. That “this is not the case anymore” is an argument that can only be made after the actual technology has reached a certain level of sophistication and public legitimacy, which is what has happened with crypto and DeFi. Cryptocurrency’s “change of vibes” is a necessarily new concept, and it’s happening in a particularly interesting way..
In other words, the way crypto is being talked about is changing, but not in response to the technology itself. People are talking as if they have a bigger investment in the game and not just because they have invested their own capital in said investments. People are thinking more about the role of cryptocurrencies in the world at large, and not just in selfish terms related to profiting from widespread adoption..
From profit to politics
Dare I say we have become political? The first time I noticed it was with the Canadian truckers’ protest against mandatory vaccinations. This affair lit up the cryptocurrency space and was not entirely in agreement or disagreement with the real goals of the group. Faced with the government freezing traditional assets and blocking standard fundraising platforms like GoFundMe, truckers turned to bitcoin and raised $900,000 in a matter of days.. Subsequent attempts by the Canadian government to block crypto assets associated with the protesting group were only partially successful. After an Ontario Superior Court judge issued an injunction freezing millions of dollars worth of crypto to the group, the crypto community responded with a mix of protest and bewilderment. The Nunchuck multisignature wallet had to reply publicly that, politics aside, they could not provide the cited information even if they wanted to: “We are a software provider, not a custodial financial intermediary,” and one that has no way of garnishing its users’ assets.
Leaving aside the uneasiness about the political positions of the truckers, the repression lifted some shackles in our space. The idea (turned into reality) that a federal government can seize crypto assets with a court order and for reasons related, at least in part, to ideology, goes against everything this community takes pride in.. The Russian invasion of the Ukraine only underlined this sentiment.
The cryptoeconomics of war
In the early days of the Russian invasion some interesting things happened. the ukrainian government solicitous soon donations in bitcoin (which inevitably led to the scammers trying to clone the account for their own benefit), and then asked crypto exchanges to freeze Russian accounts. Turning cryptocurrencies into a financial safe haven and reliable store of value for a country at war was a game changer, the effects of which we will feel for years to come. Many of these exchanges refused, claiming that it would unjustifiably punish ordinary Russian citizens for the actions of their leaders.. Some of the biggest personalities in the space seemed to be on the side of neutrality, but not without reservations. Vitalik Buterin tweeted remarkably vague about the neutrality of cryptocurrencies.
Reminder: Ethereum is neutral, but I am not.
— vitalik.eth (@VitalikButerin) February 24, 2022
Reminder: Ethereum is neutral, but I am not.
Beyond that, a ground war in Europe has unsurprisingly caused many of us to lose taste for the latest wacky NFT broadcast, at least for now: there are more serious things to talk about. And, actually, cryptocurrencies are being talked about. That is the change of vibrations, and it is not happening in response to technology.. It’s happening in response to the real world, and it’s changing the contours of crypto. It is causing a moral reckoning that goes to the very depths of what cryptocurrencies are supposed to do and who they are supposed to be for. It’s about the price of neutrality and what exactly neutrality means.
If cryptocurrencies have penetrated the real world, the real world is now penetrating cryptocurrencies. The short-sighted perspective divorced from reality that our detractors accuse us of is disappearing. This change in vibes is making it difficult to predict what comes next, especially now that we are suddenly embroiled in huge geopolitical stakes. The conversation has changed because the rules of the game have changed. Cryptocurrencies are all fun and games until someone starts a war. Or, for that matter, a truckers’ protest.
The end of history or the future of cryptocurrencies?
I remain confident in the future of crypto and DeFi, but it’s going to be a tough future. The Canadian truckers’ protest and the war in Ukraine have become unexpected situations that have no easy answers and, in many cases, some very unpleasant ones. Like most people involved in this space, I continue to believe that a large element of the hard and soft power of cryptocurrencies is related to its decentralized status without banks and removed from the traditional mechanisms of global finance. But these things are never that simple.
The purpose of a change of vibrations is that what comes after remains unknown. We are only just waking up to the power of cryptocurrencies and the huge implications of a legitimate and censorship-resistant financial infrastructure. What this means for the future and where we go from here is uncertain, and we have more at stake than the cultural denizens of New York City to whom the term was originally applied. Self-sustaining money that exists outside the control of traditional finance has not been tested in the contexts of geopolitical conflict and culture wars. What happens next will change everything.
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Dominik Schiener He is co-founder of the Iota Foundation, a non-profit foundation based in Berlin. He oversees partnerships and the overall realization of the project vision. Iota is a distributed ledger technology for the Internet of Things and is a cryptocurrency. Also, he won the biggest blockchain hackathon in Shanghai. For the past two years, he has focused on enabling the machine economy through Iota.
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