Assumed Audience: People interested in the internet, the way it works, and possibilities of better futures for technology.
Epistemic Status: The idea-bubbling, thinking-out-loud phase.
The fundamental truth of the internet is that it scales: that the marginal cost of digital artifacts is zero. When (re)production is effectively infinitely cheap, considerations that animated scarcity-driven economies fall away. But this does not mean that the economics of scarcity stop mattering: it means instead that scarcity itself becomes scarce, and those who can identify a scarcity and act on that knowledge capture the benefits. Thus: Facebook, Netflix, TikTok, Snap, etc. all correctly identified attention as a scarce “resource” to be captured, and have more or less successfully monetized it accordingly.
But the attention economy is not the only scarcity-driven digital economy: another (the other?) is “crypto”. The world of Bitcoin and Ethereum and Dogecoin (!) and, yes, Zora is premised on artificial scarcity: an almost-inevitable, certainly-predictable response to the lack of scarcity of digital goods. The two things which make cryptothings valuable are belief and scarcity: the same as the two things which make any physical good valuable. Unfortunately, cryptothings currently achieve their scarcity by way of horrific costs in energy consumption. They are, also unfortunately, nearly always coupled to a naïveté about modern financial regulations that would be hilarious if it weren’t so often catastrophic.3
“Unfortunately” I say of both of these because the key idea, of artificial scarcity, is a good one. Human beings are not meant, at least at present, for infinite scale. (What we will be in the future “has not yet been revealed.” But I rather suspect it will not be infinitude.) When cryptothings create artificial scarcity, it is a reflection of the fact that we have not yet developed a capacity for thinking of value in an abundance economy, and so require the stopgap of hyper-costly artificial scarcity. But given that the scarcity is artificial, one cannot help but wonder what might happen if we just skipped the “generate massive pollution” phase.
There are, after all, other means of generating scarcity! When Craig Mod thinks about capping his membership program, he is leaning into the fact that one person can only do so much, and that at some point scale becomes inhumane. But he is also creating artificial scarcity, and without the costs associated with cryptothings.
The set of related points on which I’m mulling, then:
- We have not yet designed an economy — financial or otherwise! — which accounts for abundance.
- There are alternative modes of scarcity than those we have so far monetized.
- Which is good, because the current monetizations of scarcity are, in their various ways, all some kind or another of awful.
- But “scarcity” is pointing at something intrinsic to the human and to our place in the world rightly conceived: our (lack of) scale.
This all leaves me wondering: what might happen if we tried Zora… but without the “mining”? And from this wondering emerges a dream of a research program for technologists: What would the implementation of such technologies look like? What would their edges and limitations be? What would they afford, and what would they not afford? How might they be well-adapted to us and our scale? How might they be built for mutual thriving with the rest of the creatures with which we share God’s green earth?
Note well the implicit plurality: no room here for single-purpose, all-consuming, hyper-generality! Note, too, that these are not hypotheticals. We could choose to build these things. And so we should.
Here I was riffing on Sloan’s own use of this to avoid saying “blockchain” —
never write it out; it’s like speaking the name of Sauron
— because he’s not wrong! (Though of course the nerd in me must note that saying Sauron’s name never had any power to draw his attention: it’s Voldemort he’s thinking of.) ↩︎
The basic tension in Bitcoin is:
Bitcoin is at its core about rejecting the traditional financial system and replacing it with something different, something trustless and disintermediated. Instead of relying on banks to hold and transfer your money for you, your money lives on a blockchain and you have direct access to it.
But most of what actually happens with Bitcoin is about rediscovering financial history and re-creating the traditional financial system from scratch.
We talked on Friday about a guy who threw away a hard drive with 7,500 Bitcoins and now has hedge-fund backing to dig up a Welsh garbage dump to try to find it. We had some laughs. I wrote that “in another decade, when Bitcoin has become the world’s main store of value and 90% of it has been misplaced, this will be a trillion-dollar rubbish dump and Wales’s main industry will be combing through it looking for that hard drive.”
But I somehow forgot that, in Chapter 10 of the “General Theory,” Keynes wrote about exactly this:
If the Treasury were to fill up old bottles with banknotes, bury them at suitable depths in disused coal-mines which are then filled up to the surface with town rubbish, and then leave it to private enterprise on well-tried principles of laissez-faire to dig up the notes again (the right to do so being obtained, of course, by tendering for leases of the note-bearing territory), there need be no unemployment and, with the help of the repercussions, the real income of the community, and its capital wealth also, would probably become a good deal greater than it actually is.
Burying money under garbage as a form of stimulus is apparently a permanent feature of economics. We talk a lot around here about how cryptocurrency enthusiasts are rediscovering all of financial history; here Bitcoin has rediscovered a joke Keynes made in 1936.