Dear Crypto CEO/Founder: Why we need to revive the crypto narrative — and how to do it
If you were my client, and asked for a confidential leadership consulting meeting, this is what I would say.
Context of our meeting:
The crypto movement is in crisis, with retailers and corporate investors fleeing the market. This time no-one seems to believe the “hodl” memes, and retail crypto traders and enthusiasts are openly revolting against the crypto billionaires and influencers.
Although this is the not first time in crypto history, the financial ramifications are at a much larger scale.
Clearly trust has been eroded, in particular as the ideas of decentralization appears to be exploited by many out there as meaning “to not promote accountability and good business conduct and ethics”.
There is a saying “When the tide rises, all boats rise with it.” But the real test for credibility is when the tide goes down, and boats crash and sink.
Who will jump ship? Will the captains stand on deck and ensure as many boats as possible can be saved? Or will they save themselves first?
During the 2008/9 financial crisis, we had an opportunity to change the game and rules of the game. Millions of people around the world lost not only money, but their ability to earn a fair living, and started questioning traditional market assumptions and economic models.
One of many change movements across the world at that time, bitcoin was born after years of attempts to create a decentralized, peer-to-peer digital cash. This started a zeitgeist for new technologies promising to enable peer-to-peer economies, reduce inherent systemic risks of centralized financial systems, and empower billions of people to mitigate future risks of economic systems they were powerless to influence.
Is the unique opportunity for crypto a moment in time and space that is being lost?
With daily dystopian future broadcasts of large scale data breaches of sensitive, private information, ordinary people are also keenly aware that they are providing free data labour to train machine learning programs and algorithms for global monopolies. Some, like Generation Z, are responding by jumping off social media.
The climate is increasingly becoming more turbulent and unpredictable. More than 60% of wildlife on earth have been wiped out since the 70s. Food and water is contaminated with plastic and chemicals. In the country with the biggest economy, the USA, the majority of household bankruptcies are due to health costs.
It seems there is no consideration by experts for the conditions needed for life nor investigation of new solutions developed outside of mainstream organizations. For example, a small group of reductionist scientists from Harvard are not only proposing but plan on testing solutions (starting 2019) to dim sunlight impacting the entire world using chemicals — instead of listening to their peers and achieve general consensus to propose addressing climate chaos systems root causes.
An economic powerhouse, China is using the convergence of technology, a cashless society, behavioral economics and big data to create a black mirror future for not only its population but also spreading the principles to other countries (and no guarantee it won’t happen in Europe and North America)
Opt-out from the machine appears impossible (surely it should be a human right?).
Young people in so-called developed countries are suffering from increasing deeper levels of despair and feeling helpless at having any influence to shape a better and more hopeful future.
For most people it would seem that all hope is lost.
Financially, irrespective of whether you are young or old, there is awareness amongst most people of the limitations of the current banking system, and the increasing personal and business risks risks of instantly becoming unbanked through factors outside of your control.
Government requirements for financial surveillance are increasing with banks having to continue to invest in more sophisticated technologies such as machine learning to fulfill their compliance requirements.
For example, in Canada the government (Statistics Canada) recently requested banks to provide full financial data on thousands of citizens without those citizens’ permission or knowledge. And there is no guarantee that, once such data collection becomes “normalized”, deeper and wider data fishing will occur.
The personal and business frustrations and costs of doing banking, including credit cards and using and sending money abroad, as well as hefty banking fees and poor customer service features are regular complaints on social and other media.
One would think this to be perfect storm of mass adoption of peer-to-peer technologies and payment systems.
Is crypto becoming a missed opportunity? Why is there not yet mass commercial adoption after 10 years?
Since I became involved in the industry in 2013, I heard that “education” and “awareness” is needed to create commercial adoption. At that time resources and energy focused on ensuring people and business owners not only became aware of crypto, but also accept it as payment and incorporate in their business. Wallet development was all the rage, in particular user-friendly, yet secure wallets.
I recall everyone was encouraged to give away bits of bitcoin (Roger Ver is consistently and to this day an example of this) and people like Boris Mann use Dogecoin to encourage people to overcome the technical barriers and understand what peer-to-peer payments are about.
Currently the amount of resources and investment made in crypto and blockchain education is astounding. Not a day goes by that there is not some conference, new lecture, and (often) celebrity panel discussing what crypto is, what blockchain is, how to invest, etc.
I propose that education, marketing and creating awareness is not enough for commercial adoption and achieving a tipping point before the industry will be absorbed into the mainstream, established frameworks.
Since the 2017 bubble the resistance barriers to adoption have become very high.
Examples of adoption resistance barriers that need to be addressed for mass commercial adoption
To be successfully employed means you cannot be a black sheep.
Full time employment and career success requires conformity to enterprise culture, and following rules of compliance — both inside work and your private life.
For professionals, such as public accountants and even academics, public association with the industry is fraught with personal and professional risks.
Incumbent organizations such as financial regulators, central banks and anti-crypto advocates continue to highlight the first use cases of bitcoin and the public association with illegal activities (whether we agree with what is considered legal or not).
For most people the idea of being commercially involved in technologies that are constantly being described by significant world leaders as mainly used for dark web and by criminals, creates uncertainty and fear to jump on board.
Above is a video clip posted by Steven Mostoviyi, who decided to personally investigate a project he had invested in.
Within the crypto industry the inability to hold people accountable including celebrities who do not deliver real value, is a root cause of the current lack of confidence in the industry and industry leaders.
It is hard to support an industry when you see crypto influencers on stage who have secured millions of dollars for their projects while they delivered very little value — and in fact lost that money, brag with pictures of their wealth and their luxurious lifestyle, while their peers are aware of this and continue to cheer them on.
Retail and enterprise investors might be silent witnesses, but they will not continue to invest nor associate with those people and their peers anymore. Most professionals that I know have no more interest in this industry because of this.
The whole idea of DAO’s and ICO’s was for developers and their projects to get funding and not be dependent on venture capitalists.
Many opportunities to develop new business models were made possible.
Everyone was inspired by how bitcoin was bootstrapped through network effects and support by enthusiasts who promoted adoption with merchants and users.
Today one hardly hears about efforts from such projects to create merchant networks and user adoption and usage. Business models are not discussed, commercial adoption strategies are non-existent, and whales often run the show.
It is particularly shocking to discover how core developers or other contributors are sometimes still working for very little financial reward, while foundation leaders/founders travel the globe as celebrities and flirt from one new project to another.
One would think a new industry with such high barriers to entry would be welcoming towards newcomers and provide support for them to not only utilize the new technologies, but also adopt the spirit of the movement.
Unfortunately I have personally seen how rampant public bullying, disrespect of different opinions and toxic social media use is the norm (and applauded), — especially by social media influencers in the space.
This also seeps into physical spaces, where people often approach me saying they do not feel comfortable attending meetups in certain areas due to the nastiness they experience.
What is most disturbing about this behaviour not only to newcomers, but toward each other, is the well known fact that most revolutions and change movements fail because of infighting.
The simple game of “divide, conquer and rule” by established organizations, is forgotten and limitless energy spend on personal agendas and wealth creation to the detriment of the greater good. Imagine how far the industry would have been by now if all that energy was directed to the bigger cause!
Crypto billionaires and developers often talk with disdain about ordinary people who lack the “consciousness” (read “too dumb”) to understand crypto and decentralization, or that people don’t care about the use of their private data (unfounded echo-chamber).
A good example is the Bitcoin Core and Bitcoin Cash fork. The current hostility of personalities supporting Bitcoin Cash SV towards the destruction of the entire crypto industry, appears to have been the final straw to break the camel’s back. It resulted in a massive financial wipe-out in the markets with real life consequences with employees being laid off even in high profile, well- supported projects and business.
The unwillingness to grow the pie and instead fight each other over gaining a larger slice of a self-inflicted reduced size pie, boggles the mind of any crypto believer who supports the cause and understand what the potential of this industry is.
Of course this reinforces and gives credibility to the “nay-sayers”
It is almost as everyone forgot the “why”.
It is still extremely difficult to use crypto and it seems there is little motivation at the moment to develop products and services for growing the real economy through peer-to-peer economies.
Where amazing solutions are being developed, the fragmentation in the industry is making it difficult to find credible information about these (because “the enemy”).
When new good solutions come along, such as Moneybutton, the founders sometimes become embroiled in chain infighting, reducing their chances for adoption and usage.
Providers of services, such as ATMs, do little to protect consumers. Instead of providing information about, for example, risks of being scammed (the classic Internal Revenue case studies) many of them seem to not care as each transaction brings them money.
Despite all the formal crypto and blockchain membership associations, roundtables and photo opportunities even with government officials, there are still no consumer protection standards in the industry, nor ethics and good business conduct — not even conferences are dedicated to this important aspect of the industry.
Without a doubt governments globally would respond to address the risks they perceive, as well as to formal complaints and class action lawsuits.
It was obvious that the DAO would result in investigations, due to the ability at that time of coin and chain founders to influence the exchanges (well documented).
Whales and bots pumping and dumping schemes caused enormous speculation unsupported by real technologies and commercial adoption.
RegTech blockchain startups also got into the game, using these new technologies to reinforce the current compliance rules. In some cases, some founders and experts are actively advocating against the industry.
In countries such as Canada, where the world’s first bitcoin ATM was established and Ethereum conceptualized, proposed new regulations will make commercial adoption costly and almost impossible.
Earlier in 2018 regulators indicated they could best tame the industry by regulating the technology, such as smart contracts. Signals are already coming that core developers might be seen as having fiduciary responsibilities.
While blockchain enthusiasts want to tokenize everything, it is important to remember that merely automating current systems do not necessarily improve them nor create a new renaissance for social, environmental and economic change.
As the gap between technocrats (such as the founders and investors of Amazon, Facebook, Google and Tesla) and the majority of the world’s people and their aspirations grows, it is clear that their technologies are rapidly accelerating problems in the world.
For example, technology is contributing to immense environmental, political and social harm which is never discussed in their ambitions to colonize space.
In promoting the singularity, no graphs or discussions are disclosed using full cost accounting, which would incorporate the real cost of new technologies and their algorithms (such as social and environmental costs).
For the majority of people who are motivated to change the status quo, there is increasingly little benefit in engaging with crypto and blockchain technologies if they simply appear to continue to accelerate the very problems that brought our societies to the tipping point where we are today.
Which brings us to “What is in it for me?”
As with most enterprise technology adoption challenges, there is a lot of emphasis on training and marketing, but not much focus on communicating the “why” (change management 101).
With all of the issues listed above, and the need for dedicated study and engagement with the industry to stay up to date, figure out good information from bad, and deal with the technology risks, the benefits of using and promoting crypto need to outweigh the risks and effort.
Once financial speculation contributed to public financial distress and distrust in the market, there are currently very few fresh and compelling narratives and reasons for personal and commercial use of these technologies and new digital assets.
Honest and dedicated token and blockchain founders and startups face a much more difficult battle than, for example, normal silicon valley and other industry startups.
They have to deal with volatile prices in the market place, constant forks resulting in constant upgrades and changes to their products and services, relentless scrutiny by, for example, the SEC, social media “wars” with competing chains, unfriendly business environments, risks of becoming unbanked without warning, funds frozen by banks and lack of skilled talent and investors to fund their projects. It is also difficult to find good accountants, lawyers and tax experts.
While they are developing complex frontier technology (not just simple platforms) they also have to to counter constant negative publicity and tackle relentless bad actors in the space. Communities push them with “When moon/tokens?” and because of volatility they need to spend significant time with liquidity and treasury management.
The cost of their business is increasingly rapidly with new compliance requirements including AML, while they also are expected to contribute to open source cyber security standards to keep their business safe (with limitless hacking attempts). Social media hacks enable thieves to impersonate them.
Most of them travel constantly across the globe as part of their work to build strategic ecosystems and communicate with their investors. That could wreak havoc with their personal health and important relationships.
There are not many experienced pathways to successfully develop and grow decentralized, permissionless technologies and onboard new customers in this frontier technology.
Community and eco-system development are core to the growth of the network effects required for crypto to be successful. Community ambassadors face an increasing heavy burden, making it difficult to grow healthy and viable ecosystems. For example, they often work for free and at their own cost to develop communities (including developer skills) and with no fair reward.
This pressure often takes a toll on relationships with family, friends and even personal health.
Their efforts are “dismissed” by large tech companies and consulting firms, or sometimes even exploited by “mining” the goodwill and community assets created but excluding those who developed those assets in the first place.
There are no expert guidance books or development in roles as “shepherds” in leaderless environments. In addition they often deal with complex human dynamics, including community conflicts.
They have no means of holding people accountable, with lots of volunteers who often cannot implement or join for personal public relations.
Community ambassadors have no guarantees nor protection/insurance of success (we are constantly told this is an experiment). Often they face the Artists Dilemma being unable to generate revenue from their own content and effort in the open source environment.
To add to this, there are limited successful crypto projects to promote to gain more credibility in community building efforts. One can only run so many hackathons. Add to it market saturation, scepticism and negativity bias in reporting.
Community wellbeing is not valued nor supported by foundations nor crypto founders.
When Human Experts?
After 10 years since the bitcoin white paper, the crypto industry still places no value on including experts in the human dynamics and organizational development. It is heavily skewed towards founders, developers, marketing and compliance.
BUIDL everything you can, but without understanding and incorporating the human elements of tech adoption and business management, they won’t come — because ultimately humans decide to use/not use technology. Even Microsoft makes it a requirement to invest in change management expertise before implementing their new enterprise solutions.
In behaving this way, the crypto industry is replicating the current centralized tech industry, where social sciences such as philosophy, anthropology, history, psychology, wellness experts, systems thinkers, regenerative cultural creatives, and even new engineering disciplines such as biomimicry and financial innovations such as regenerative capital, are dismissed as less important than coding, engineering and trading.
Contrast all of the above adoption barriers with established tech business, for example, they
- Are User Experience Specialists
- Create curated, quality learning platforms and methodologies
- Experienced in behavioral economics and use of AI/machine learning
- Competent in Strategic Digital Transformation and Tech adoption
- Have Curated and Trusted Partner networks for rapid deployment
- Client/customer insurance and brand
- Efficient and competitive (centralization effects)
- Rapid and responsive upgrade capabilities
- Performance and outcomes cultures
- High switching costs (emotional, cost, etc) for consumers
- Significant funding
- Global Political influence
Who do you call?
“In a decentralized organization, there’s no clear leader, no hierarchy, and no headquarters. If and when a leader does emerge, that person has little power over others. The best that person can do to influence people is to lead by example.”
From The Starfish and the Spider: The Unstoppable Power of Leaderless Organizations by Ori Brafman and Rod Beckstrom
What we focus on, grows: Reigniting our Movement with Positive Maverick role models
The purpose of the Positive Mavericks: Blockchain Leadership Best Practices initiative is to
- Interview and record the personal and professional practices from positive maverick founders and leadership practitioners in the crypto and blockchain economy.
- Distribute these interviews globally, for example, through The Blockchain Executive Radioshow on platforms such as Blockchain Radio.
- Encourage crypto and blockchain educators, conference and roundtable event organizers to invite them to speak about the content of the interviews.
- Study and implement leadership and cultural development practice in the Medium publication and forthcoming book.
- Host leadership development workshops using the content created. (Invite experienced leadership facilitators to design and lead these.)
- Make the outputs available to copy and reuse.
- Establish Communities of Practice around the world — in particular empower and encourage community ambassadors to show the way.
Presentation slides about this topic available on slideshare.
(Note: Opinions are my own and do not represent any organization.)