Tweetstorm: On Bitcoin Paradigm Shifts

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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 -…

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

unlike most β€œdigital” 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 πŸ‘‡ 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.