The Poverty of Tokens

4 minute read

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The Poverty of Tokens

By Erik Cason

Posted May 13, 2018

The tokenization of everything won’t change anything if the revolutionary nature of crypto is lost.

Since the early days of bitcoin there has been the ‘tokenization’ of various assets using the bitcoin blockchain. From ‘colored-coins’ to the short-lived bitcoin stock markets, tokens are nothing new to crypto. However, with Ethereum, Neo, and other smart contract platforms having made tokenization so easy, there is now a massive land grab going on in the crypto-ecosystem to tokenize nearly everything. While tokenization itself is potentially revolutionary in its ability to radically change and distribute forms of ownership, it is rendered meaningless if it is expropriated to serve the current economic paradigm crypto-assets are seeking to escape.

Right now the whole crypto-ecosystem is in the throws of a dangerous reactionaryism that is losing itself in the mania of ICOs, shitcoins, and KYC/AML bureaucracy. By taking blockchains and making them non-anonymous, pre-mined, and mutable destroys the very sovereign power that exist within blockchains; rendering their true power inactive and meaningless. Furthermore, the inversion of blockchain technology in this reformist way can create a panopticon of terrifying proportions if we are not careful. There is a real danger of blockchain technology being captured and empowering the very institutions and regulations that it was created to escape from if we continue on this path. The process of tokenization as it is today is little more than a mutilated form of techno-banking that reinforces the economic disparities of the world, forgetting the conditions that allowed for its creation in the first place.

If we simply trade bankers for coders and regulations for mutable blockchains; we will find ourselves in a worst position than when we started. While bitcoin and many crypto-assets will always have at the core of them the radical possibility that is always contained in cryptography; it is important to remember that it is possible for it to be rendered idiotic and mute to itself.

“Whether the pupils have lost It [their Scripture] or weather they are unable to decipher it comes down to the same thing, because without the key that belongs to it, the Scripture is not Scripture, but life. Life as it is lived in the village at the foot of the hill on which the castle is built.” -Walter Benjamain

Through serving the same masters of capital and state, and focusing only on the economic nature of crypto assets; and not the political, philosophical, and even religious, the Key to this technology is lost. Without understanding these critical aspects of this technology, we profane the radical nature which created it in the first place and will find ourselves under the glare of the castle at the foot of the hill.

The Radical Possibilities Within Cryptography

Yes, [we will not find a solution to political problems in cryptography.] but we can win a major battle in the arms race and gain a new territory of freedom for several years.

Governments are good at cutting off the heads of a centrally controlled networks like Napster, but pure P2P networks like Gnutella and Tor seem to be holding their own. -Satoshi

While there is still the possibility that we can use this technology to explode a radical new epoch into reality, there is a real danger that it can fail, or be turned against us. Not for the lack of the technological capacity to create such a future; but from the lack of political will, thought, or vision beyond just economic means to accomplish it. The poverty of tokenization is it profanes the radical nature of crypto assets and encrypts the very meaning of crypto to itself. It is creating life as it is lived in the village at the foot of the hill as in Kafka’s novel The Castle.

If we want to keep alive the vision that allowed for this technology to flourish in the first place, than we cannot betray the cypherpunk roots and crypto-anarchist principals which allowed for this whole ecosystem to bloom thus far. We must continue to insist upon fungibility through anonymity, consensus through decentralized participation, and the mathematic-legal guarantees of cryptography which allows for immutable blockchains to exist. Projects robbed of these features will do nothing more than serve the empire of old wrapped in the garb of new.

In order to keep the revolutionary possibilities of crypto alive, and to win the arms race to ensure the Internet remains a sovereign and free territory, we must acknowledge the political and philosophical nature that lies hidden at the very centre of these systems. Until there is a wide acknowledgment that this technology goes far beyond just economic means, tokenization will continue to prove the poverty of its philosophy.

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