Bitcoin Alternative: A Conscious Finance Approach
2001 Space Odyssey, Altruistic Crypto Protocols and the Re-Humanization of Finance Through the Future Wave of Conscious Leaders.
This newsletter does not represent the views of the author’s employer and is not a financial or investment advice.
It is intended as a psychological, philosophical and systemic approach to the Bitcoin phenomenon to elevate the consciousness levels in the finance industry.
The newsletter is about Bitcoin and should not be generalised as views to the wider theme of Blockchain technology.
The writing of this article intends to be gender-neutral.
Bitcoin Space Odyssey
In the movie 2001: Space Odyssey, there is a scene of a group of monkeys around a black monolith.
The monolith can be seen as the representation of epic transitions in the history of humankind.
Our ancestors - the monkeys - looked at it with adulation, worship to something beautiful and yet, not clear its end purpose.
In this first encounter with the mysterious monolith, one of the leaders in the group of monkeys has a flashback, making him pick a bone and use it as a weapon to conquer other tribes.
The message couldn’t be clear: in the face of a beautiful idea, human nature inclination is to use technology as a weapon of power.
That has been the history of Bitcoin
A beautiful idea turned into a tool of power.
The purpose of the monolith was advancing intelligent life, represented in the monkey’s flashback — and yet, the first thing the monkey does is to gain power over others.
So was the purpose of Bitcoin to advance the democratisation of finance — hijacked to build an oligarch system, gaining power over those who haven’t acquired it.
In today’s world, the monkeys are more sophisticated — their nature is the same.
The need to replace the Bitcoin prototype with a Conscious Crypto is not a matter of creating alternatives in the market.
It is a matter of the need to create a consciousness shift in the history of humankind.
Bitcoin Singularity: What Is It?
Bitcoin Singularity is an example of the broader concept of technological singularity — “a hypothetical point in time at which technological growth becomes uncontrollable and irreversible, resulting in unforeseeable changes to human civilisation.”
The concept was first used by John von Neumann and is currently most used in AI.
Although I refrain from believing in doomsday scenarios promoted elsewhere, the fact is that technology one cannot deny the impact of technology in our lives.
What is less discussed is the impact of technology on our beliefs systems and, most importantly, how it shapes our behaviours.
There is a growing field on “AI ethics”, but less so on “Blockchain ethics” and perhaps almost inexistence on “Quantum Computing ethics”.
Bitcoin Singularity can also be thought of as a tech monopoly system that refrains development.
The idea is that regardless of any superior cryptocurrencies one can have, Bitcoin will become the major one irrespective of its numerous flaws.
Bitcoin Singularity would be disastrous for many different reasons.
And yet it is a very real one, more than what the public can think of.
Supported by a marketing industry with the agenda to inflate its value so that early adopters will profit the most, Bitcoin’s agenda is not to solve real problems in the world.
One could go through an endless list of technical flaws that Bitcoin suffers, and other crypto projects are trying to address.
But regardless of potential better cryptos to be created, Bitcoin has already changed the belief system in many people.
And once such beliefs are formed, it becomes almost impossible to change them unless with a much superior concept.
Bitcoin Dominance Index
Bitcoin Singularity is measured by the “Bitcoin Dominance Index.”
Sadly, “Bitcoin Singularity” is an alien concept to the many shortsighted-Excel-oriented-people who fail to understand the bigger picture due to their overreliance on “linear thinking” as opposed to “systemic thinking”.
For those who can only perceive the world through Excel formulas, please refer to the excellent book “Blockchain and Distributed Ledgers”> chapter 10 > formula 10.52 with associated explanation there, so you can better understand the concept of “Bitcoin Singularity”.
One of the many insights it provides — and contrary to popular belief — is how the current high volatility in crypto is actually benefiting Bitcoin to be the dominant one in the long term.
Bitcoin Protocols
In a simplistic view, Bitcoin is built from 3 protocols:
From all the three main protocols, one can say that only the first provides a real solution to creating a decentralised digital currency, with the other two factors being rather conditions in a game theory with the sole purpose of creating a “viral effect” on its adoption.
In that sense, Bitcoin is a success — it works as designed!
The problem is the design itself.
A designed with false narratives that have been exposed elsewhere, see, for example, my newsletter “The Decentralization Fake Narrative”.
Other cryptos have addressed some design flaws, and others create a full ecosystem.
The common goal seems to be to reduce the frictions in the current financial system.
This is, by all means, an honourable goal, but it lacks considerably to solve bigger issues that humankind is facing — a wasted opportunity.
Regardless of the technical advances and to make the current system more efficient, the community is overlooking the implementation of crypto protocols that promote more altruistic behaviours.
In particular, protocols aligned with the Sustainable Development Goals by the UN.
A Conscious Crypto would have coded protocols to reward behaviours targeted to social outcomes, as opposed to selfish & mindless behaviours such as HODL or “when Lambo” promoted by the so-called “Tik Tok influencers”.
Only the future wave of conscious leaders will be able to use technology — AI, Blockchain, Quantum Computing — for the greater good and the development of humankind.
Conscious Protocols
More than tech developments, one needs to design systems around human-centered principles.
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Here are some suggested protocols for future conscious crypto:
In the mid-90s, Craig Newmark created an email list between friends to promote local events in San Francisco Bay Area.
Due to its originality quickly becomes an advertising vehicle for vendors, landlords, and other commercial agents.
The mailing list becomes famous as Craigslist.
As with any technology, some bad apples started to interfere with the content of the list.
But contrary to the Bitcoin prototype example, the Craigslist community started to self-regulate the list by adopting a simple protocol; flagging the bad apples.
Here’s an exert of an interview with Craig Newmark:
Craig: “You know, we’re finding that pretty much everyone out there shares, more or less, the same moral compass as we do and as my personal one. People are good. There are some bad guys out there, but they are a very tiny minority, and our community is self-policing. People want other people to play fair, and that works.”
Interviewer: “You set up a way for the community to regulate the site, right?”
Craig: “Yes: flagging. Flagging works. By virtue of flagging, we’ve turned over control of our site, for the most part, on a day-to-day basis to the people who use the site. We need to figure out better ways of doing that; that’s still in process.”
Flagging Protocol will be crucial if one wants to remove the bad apples from a Crytpo Economy, in particular, due to the presence of “bump-and-dump” activities.
As mentioned in this research article, “if cryptotokens are to be effective in helping to address the “Sustainable Development Goals”, they will need to be optimised within “behaviour change interventions” (BCIs) according to documented, evidence-driven standards, maximising learning potential.
Through a growing group of social impact practitioners, token engineers, cryptoeconomists, and experts from related fields dedicated to collaborating, we seek to identify the principles, build protocols, and develop tools to ethically and efficiently use tokens as behaviour change tools for the common good.”
Conscious crypto could then have a protocol to reward investments aligned with ESG directives, driving consumers to change behaviours and create a more sustainable system.
In the excellent book “Finance and the Good Society”, the author Robert Shiller writes:
“The democratisation of finance works hand in hand with the humanisation of finance. To that extent, it is important that finance be humane, and that it incorporates our increasingly sophisticated understanding of the human mind into its systems, models, and predictions.”
He also describes how each finance practitioner can direct their efforts to re-humanise finance, from the CEO to the Financial Engineer.
Robert Shiller also mentions the impact of philanthropy.
Regardless of the inner motivations of those who donate their money, the overall impact tends to be positive, although one needs to be conscious of its side effect, such as potential loss of dignity from the dependency on charitable gifts.
As part of an initial conscious crypto prototype, one should not discard the implementation of a protocol linked to philanthropic behaviour.
Many other protocols can be thought to be coded and integrated as part of a conscious crypto.
I believe that such achievement will be only created by the future wave of conscious leaders.
Tip of the Week
Some of you may think to yourself:
“What is this guy talking about?!
Re-humanise finance?!
I’m very busy with a lot of important things and have no time for this nonsense!”
If that is the case, may I suggest that, indeed, you are busy… doing nothing?
Busy completing mindless tasks only to ensure you don’t look bad in front of others?
Busy procrastinating on what matters the most because it is difficult?
Busy chasing trends instead of building an entrepreneur mindset?
Busy creating problems where there are none?
Busy reading but not reflecting?
Busy talking but not listening?
These and many other habits have become the “best practices” in the financial industry.
Many finance practitioners always seem in a rush and do not have the time to stop for a moment to reflect.
Sometimes, reflection requires using other parts of the brain that have been utilised for a long time, getting trapped into the old habits and triggers.
The danger of being focused solely on our day-to-day routines is missing the bigger picture and going in circles.
“We tend to thing that matters such as love, art and music, things that cannot be measured in mechanical terms, they have no value or meaning. We are diluted in our reality, and that is helping us un-making the world, dismantling the world that is intrinsically complex & beautiful, and instead, replacing it with a litter of garbage” —Iain McGilchrist
Unfortunately, most finance & tech practitioners don’t understand the meaning of these words enclosed in their shortsighted Excel & PowerPoint activities — always in a rush to complete their to-do list on time to watch their favourite Netflix show.
Ask yourself:
“Do I believe the things I do are praiseworthy?”
“How do I place myself in this world?”
If these questions are bothering your mind, reflected perhaps in high levels of anxiety or procrastination, don’t hesitate to book an appointment here for a free coaching session.
Book your call here:
Alternatively, please DM.
Thank you for reading this newsletter.
Nuno Reis
Former Bitcoin believer turned into a Bitcoin sceptic.
Disclaimer: Opinions expressed here are my own.
#bitcoin #cryptos #esg #esginvesting #consciousleadership #futureofbanking #futureoffinance #singularity #scalabilitytrilemma #nunopost
Strategic Advisor to firms in the Digital Assets industry. Former Digital Assets Product & Strategy & Commercial Leader at Bloomberg
2yInteresting as always nuno and institutional crypto has a long way to go. I only question your impartiality given the #sidehustle