Read Write Own

Chris Dixon put together a great book, clearly the culmination of years of work and thinking. Which is the real value: a synthesis of computing history, how we got to where we are, and why and how blockchains can be useful to get us to where we want to go (given certain dynamics like “network effects driving take rates”).

It’s your own private econ/corp strat class in a little 15-ounce package.

The first half of the book sets the table well: Dixon employs lots of useful frameworks/first principle thinking to succinctly take you through the history and explain how we landed in the place we currently occupy.

TL;DR is right there in the intro:

The internet got intermediated, in other words. The network went from permissionless to permissioned.

Then he has to disespouse you of the idea that blockchain equals cryptomania, and that distinction of “casino” versus “computer” continues through the book, which is an important given the average person on the street thinks of Bitcoin when you give them the “blockchain” Rorschach test.

Blockchain solves some real problems

Dixon shows that blockchain potentially solves a lot of our current problems, especially related to platform risk and what he calls the attract-extract cycle, for example:

• Product deteriorates or gets killed. I was bullish about Keybase a while back: great team, great product. I put all my encryption-worthy stuff on there, and then they sell themselves to Zoom, and product is left to languish (and even break down) to the point where I need to get my stuff out of there. (It’s also why this blog is not much more than a set of markdown files, a static site generator, and GitHub Pages instead of the blogging service du jour.)
• Your favorite product goes from attract to extract. Time and time again, we get fooled at the beginning of this cycle: “Hey, these Ubers are amazingly cheap compared to taxis!” “Wow, I can stay in a luxurious Airbnb for a fraction of what I pay at a Marriott!”
• The antidote to AI. It comes in right before his conclusion, but I also very much concur with the idea that web3 will/should play a very important role in creating a verifiably human web in the era we’re entering where AI will have us all so confused and mixed up (deep fakes have already begun). So the identity side of it is going to be important (if it isn’t already). I think I heard Fred Wilson articulate this first, but very glad Dixon includes this.

My persisting questions about blockchain in the long-run:

1. Can blockchain networks overcome their “cold start problem” (as Andrew Chen puts it) in markets where there are aggressive, deep-pocketed corporate incumbents who can undercut them and wage a price war for a prolonged period? Perhaps this is where venture and other funding sources may come into play? Should entrants target niches to avoid this corporate competition (i.e., instead of web3 Uber or web3 Airbnb, focus on carving out new markets per the 1k true fans idea [p.193])?
2. Is blockchain technology viable long-term, cryptographically? Can it stay ahead of quantum computing and its ability to hack it (i.e., can it be quantum resistant)¹?
3. With deep fakes already here, there’s a clear need for identity verification and attestation, but is there a place for pseudonymity in other areas of web3 digital life?

Does this matter? Yes, when you think about the fact that we’re living more and more of our lives online and yet we’re ceding control to a handful of companies whom we’re trusting to “not be evil” (from p.226):

The future of the internet is us—you and me. The internet is, increasingly, where we live our lives, and it overlaps more and more with the so-called real world. Think about how much of your life you live online, how much of your identity resides there, how much you interact with friends whom you’ve developed relationships with through the medium of the internet. Whom do you want in control of that world?

Anyway, I’m smarter now on web3/blockchain…not to mention all the more bullish.

— ᴘ. ᴍ. ʙ.

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