Tweetstorm: On Bitcoin Paradigm Shifts

1 minute read

Tweetstorm: On Bitcoin Paradigm Shifts

By Meltem Demirors

Posted july 23, 2019

1/ paradigm shifts seem to be a big topic these days.

there are two important ones happening right here and right now, which have been proven possible by bitcoin.

digitization and disintermediation.

a very short thread…

2/ today, the realm of digitally native assets is worth nearly nothing. digitization is largely taking existing (often physical) assets and transposing them to a new medium.

bitcoin is a digitally native asset that is backed by its own scarcity and the demand for it.

3/ historically, digitization requires more reliance on intermediaries, not less.

my colleague @RyanRadloff wrote a brilliant analysis on intermediaries and their role in digitization - medium.com/coinshares/bit…

4/ bitcoin breaks that trend. it requires no trust in an intermediary.

unlike most “digital” assets, bitcoin requires no intermediaries. some may choose intermediaries, but bitcoin requires no such thing.

it took me a long time to process how profound of a change that is.

5/ and that leads us to a second paradigm shift - disintermediation.

in the short term, people may opt to use intermediaries to access bitcoin (as they do today.) longer term, a new behavior will emerge - one that is a revolution and makes the asset independent.

6/ trust has long been the grease that drives the grinding gears of capitalism.

but trust in markets, in economies, in institutions - is at an all time low. and for good reason.

a world without trust necessitates a new model.

this @cryptograffiti piece 👇 captures it nicely:

7/ this new model doesn’t materialize overnight.

our psychological anchoring keeps us rooted in the world of the physical, and the idea that intermediaries protect us from risk.

@eiaine captures this brilliantly. change is coming. slowly at first, then suddenly and at once.