One of the key aspects of the crypto boom that keeps bothering me is the inherent conflict between centralized entities and decentralized entities.¹ For instance, let's think about Bitcoin. Bitcoin is a supposedly useful form of money because it's decentralized and no one can manipulate it. Then again, I've argued that Bitcoin's biggest weakness is its decentralized nature because:
Of course, there are times (like hyperinflations) where a decentralized money will increase in value so decentralized money has a place in the monetary system even if it's at the margin. Bitcoin (or some version of it) is very unlikely to go away or go to $0 because there will always be demand for it in places where governments destroy their currencies.
But Bitcoin is not an ideal example here because I don't think currency is the most useful aspect of the crypto boom and the blockchain more generally. The more useful aspect is in decentralizing basic services. The coin attached to various decentralized services isn't a “currency” as much as it becomes a means of rewarding those who validate the decentralized ledgers that track various services. The coins basically become ways of paying people for whatever service they're providing in much the same way that equity is issued to employees of firms as a means of payment.
Interestingly, this area is ripe for corporations to crash the party. For instance, although it was widely mocked, I thought the KodakCoin announcement was fascinating for several reasons:
