The End of the Narrative Era: Crypto Must Focus on Utility

<p>Bitcoin and crypto have up to now been driven by narratives. Essentially, this means that stories are told about what crypto can do, or is just on the verge of doing, and then hype builds around these concepts, driving interest and pushing up prices.</p><p>
In the case of bitcoin, this has worked particularly well due to its neutrality, and the financial/historical literacy of its advocates, who can quickly identify the societal gaps into which bitcoin slots most easily.</p><p>
Whatever the crisis of the moment that is grabbing headlines, or being circulated on social media if it’s an angle mainstream news channels won’t cover, bitcoin is frequently presented, plausibly, as a solution.</p><p>
So when the issue is walking-dead, bailed-out financial institutions, bitcoin is an independent network that cannot be corrupted. When private individuals cannot access their funds (see the truckers’ protest in Canada, when citizens’ bank accounts were frozen), bitcoin is presented as a decentralized, bank-free alternative.</p><p>
When war breaks out in Eastern Europe, bitcoin is shown to have utility for both sides in the conflict (as a potential off-the-shelf alternative for a country, like Russia, that’s locked out of the global banking system, and as a way of quickly transferring money to war-threatened Ukrainians in need of relief, and also as a means for those fleeing danger to transport their monetary wealth).</p><p>Bitcoin as a Trojan Horse</p><p>Commentators including <a href=””>Alex Gladstein</a>, of the Human Rights Foundation, have put forth the concept of bitcoin as a Trojan Horse, smuggling in freedom. The idea goes something like this: investors are attracted to bitcoin because of its ‘number go up’ characteristics. Meaning that they see how much its value has risen over the past decade, and correspondingly, how much the purchasing power of fiat has declined, and figure out that it might be a good idea to change some of that fiat into <a href=”” target=”_blank”>bitcoin</a>.</p><p>They’re driven by self-interest, rather than noble intentions around the betterment of society, and that’s fine, because the socially beneficial aspects of bitcoin are advanced simply through having people at first hold it, and then, hopefully, transact with it.</p><p>
Essentially, bitcoin contains within it freedom, decentralization and a shift away from top-down authority, so no matter your initial motivation in buying it, and wherever your politics might lie, you’re co-opted into advancing bitcoin’s power as a pro-freedom technology.</p><p>
“<a href=””>Greed is good</a>”, said Gordon Gekko, but when it comes to bitcoin, self-interest is globally liberating.</p><p>Buying Alone Is Not Adoption</p><p>We often hear talk of crypto adoption, and there are positive charts showing the numbers of crypto wallets growing, indicating that increasing numbers of people are holding crypto. But, what does adoption actually mean, and does the act of simply creating a wallet and holding some coins fit the definition?</p><p>When there’s a bout of FOMO and crypto is flying, is that adoption? Arguably not, because the nuance contained within the term adoption is about something actually being utilized for a specific purpose.</p><p>
How about, in the case of bitcoin, being held as a store of value that moves in the opposite direction to fiat’s declining power? This is much closer to a meaningful form of adoption but still falls short of full use as a true currency that is employed regularly as a means of exchange.</p><p>From Narratives to True Utility</p><p>While narratives have been tremendously useful in onboarding newcomers and creating compelling, believable predictions about what crypto might enable, there is a point at which stories must translate into reality.</p><p>
It would be satisfyingly clean if the first decade of crypto’s existence were about exploring concepts and testing the imagination, and the second decade turned into an era of tangible use cases.</p><p>By the way, you will find crypto skeptics who declare that crypto is a solution in search of a problem. It’s a catchy line, implying that there is no real utility in crypto, but despite sounding snappy, it feels reminiscent of those who expressed <a href=””>similar, wide-of-the-mark sentiments</a> about the web in its early days.</p><p>However, it is true that, as happened with the web, crypto’s use cases need to become clearer and more apparent. That said, this looks likely to occur, considering ongoing high levels of developer activity in a crypto space that is becoming more resilient with every bearish cycle.</p><p>Keeping It Simple</p><p>With regard to what crypto’s use cases actually are, there is no need to over-complicate matters or to shoehorn <a href=”” target=”_blank”>crypto</a> in where it is not required. A small but important number of simple, practical uses are immediately apparent, and from those foundations, more esoteric and complex extensions might evolve in time for those who are interested in pushing the boundaries.</p><p>
If bitcoin functions as a store of value and usable currency, that alone will be genuinely profound, moving us into a post-fiat era in which personal finances and transactions no longer require the involvement of central authorities.</p><p>And, if fungible assets become digital and in self-custody, then the same can be true of unique items, as represented by <a href=”” target=”_blank”>NFTs</a>. Any item that currently requires verifiable proof of ownership can have that proof stored as an NFT, meaning that again, no centralized authority is required, and we then have full independent ownership and verification of our assets, both monetary and unique.</p><p>
What’s more, NFTs can extend from the digital to the physical, meaning that rights over real-world assets can be held in NFT format, and ownership can be traded digitally, instantly, and without the need for third-party involvement.</p><p>
Through the development of DeFi, we see the means by which financial services that currently rely on permissions granted by centralized institutions can begin to operate on an entirely peer-to-peer, decentralized, more democratic and transparent level.</p><p>
These three basic uses, decentralized currency, decentralized trade in non-fungible items, and decentralized financial services, would shift us into a distinctly new era. They would then, in time, fully open up that quietly advancing Trojan Horse.</p>

This article was written by Sam White at