Bitcoin, The Ultimate Too Big to Fail

Bitcoin, The Ultimate Too Big to Fail

Digital Money — Quacks like a Duck

Virtualization, telephone protocols, software PBXs, mobile devices, and my 35 years working directly with technology and a predilection to recognize trends are both a blessing and a curse.

Like many, when I first heard about Bitcoin, my mind immediately went to previously failed attempts at digital money. OK, maybe not everyone’s first thought was about eCash and other digital projects; I was a technologist implementing leading-edge technologies for corporate customers worldwide. I always had one eye on the up-and-coming bleeding edge of technology, much of which became widely accepted mainstream after it proved itself in the marketplace. There is a relatively standard evolution from WTF to mainstream adoption.

Along comes Bitcoin

While doing research on clustering, load balancing, and replication, I came across an article discussing Bitcoin’s distributed nature. Naturally, I had to drill down until I understood the implications for my customers. This time, I did not come away with answers, but rather a million more questions. And as the door to the rabbit hole opened wider, I was led to question more than the technical underpinnings of the protocol. What is the nature of money and currency culturally, legally, and geopolitically? Why has fractional reserve banking, with its obvious shortcomings, not run its course? Are the recent bank failures a result of a flawed system of money, fiscal policy, or both?

I think when one has the capacity to grasp Bitcoin’s or any technology underpinnings (Its code, security, and math) and if that holds up under scrutiny, well, the next logical question is, will this catch on? And if it does catch on, what are the implications for businesses, consumers, governments, and the world? I watched email grow from an early internet phenomenon for the scientific community to multiple isolated corporate systems, unique retail systems like AOL and Prodigy, to connected corporate systems with Banyan Vines and Lotus Notes to a full-blown interoperable SMTP global email. Bitcoin checked all the technology right boxes out of the gate.

Like many technology folks, I like to get our hands dirty and learn what the salespeople and documentation do not tell us. The best way to learn is to break the shrink wrap and use the stuff. So, I bought some Bitcoin. Not accustomed to what Wall Street called “Volatility,” e.g. the movement of a few basis points in one direction or another. So, the Bitcoin price movement was not disturbing to me; it always seemed to trend upward. Shortly after I became the proud owner of a $331 Bitcoin, China announced a ban, and the Ethereum boys were making their claims to fame.

Trying to share my newfound understanding was met with that look. You know, the one where they are thinking, he really lost it this time. I had only started to scratch the surface of all the important questions Bitcoin brings with it. Explaining it to others who did not have the same motivation to dig deep was not something that could happen in an elevator pitch. And when you start questioning the integrity of the US dollar, well now you’re in “crazy town” and nobody has an open mind. So when the company treasurer asked me about Bitcoin and Blockchain, all I could say was, “The best way to learn is to own some,” I set him up with a Coinbase account and sent him $10 of Bitcoin. A week later, he informed me that he had bought a whole Bitcoin at the time in the neighborhood of $600.

A short time passed, and an amazed treasurer pulled me into his office and told me his Bitcoin lesson was now worth $12,000. The news leaked to the rest of the C suite, and I was inundated with questions from them. The headlines were filled with stories about the insanity of the ICO movement. Bitcoin made sense to me, but some of these other Bozo coins were really thin on facts and thick on marketing and promises. It got so I could not walk to the men’s room without being buttonholed by a senior executive eager to learn about the new crypto craze.

In the interest of good toiletry habits, I started a newsletter with the apt title “Crypto Gambler.” Circulation was small, but my restroom trips were interruption-free. My Bitcoin holdings grew, and I got a stake in the original Ethereum offering. Along with a few other shitcoin gambles, I started to earn more in crypto than I was making with my consulting business.

As a child I was the sort of person that my mother would not allow me to hang with. Knowledge was not on my priority list. However, my father (an MIT grad) impressed me with the fact that knowledge is something valuable that nobody can take away from you. As a young adult with a new wife and growing family, I became obsessed with learning, so when Bitcoin came along, I invested most of my Bitcoin earnings in any book or online resource I could get my hands on. The MIT course “Future Commerce”, while very good, was light on Bitcoin blockchain details, primarily designed for banker and finance types; it missed the mark in the “Too Big to Fail” area. Understanding that the security and distributed nature of the Bitcoin network had inevitable consequences for Banking, Finance, and Governments was a hard pill for my cohorts to swallow.

Fast forward to 2024, ETFs, El Salvador, and government fear and trembling are evident in Elizabeth Warren’s crypto army BS. There is no doubt that the monied powers understand now what was clear to me in 2014: Bitcoin genie is not going back in the bottle. As a result, the world is profoundly changing; finance and economics will never be the same. Bitcoin is the ultimate Too Big to Fail phenomenon as it eats Wall Street and eyeballs emergency reserve status in the US government, simultaneously courting the likes of BRICS and BOC. In the words of Bob Dylan, “The times they are a changing.” Goldman Sachs, Black Rock, and The FED are no longer inevitable, and the mantle of being too big to fail has shifted to math and code. Transparent, secure, and predictable, The “Bitcoin Gold Rush [1]“ is on, and tomorrow will be a different world.

What has become apparent to me in the 70+ years on this earth is that everything changes, and it does so continuously. Only when we become too attached to yesterday’s ways and technology do we see the future as a disaster about to happen. Living in the moment with one eye on history and another eye on the future will leave you a bit cross-eyed, but the flow of change starts to make sense. In my short life, I lived through the threat of nuclear disaster, seatbelts in cars, incredible inflation, bell-bottom jeans, Arpanet becoming the internet, brick-sized cell phones morphing into pocket-sized smartphones, and now the technological transformation of money.

I’ll put my faith in the human spirit; neither collapse nor business as usual will be in the cards for us. What was commonplace, going forward in commerce and baking, will look as strange as horse shit on the streets of Manhattan, once commonplace, now an oddity.

[1] Michael Saylor — https://www.youtube.com/watch?v=BjGOSXwQO3k