A Unifying Theory of Everything

This week, New York Magazine let me go full stream of consciousness on … everything. Their editor pitched me the idea to articulate a unifying theory on “this whole crazy techno-fiscal moment.” Problem is, while I understand crypto better than 99 percent of people, I do not understand crypto.

On Wednesday, crypto pioneer Coinbase listed shares on the NASDAQ, and closed the day at an almost $100 billion valuation, making it nearly as valuable as Goldman Sachs. Coinbase’s big day made a bunch of wealthy people wealthier, but it also poked several bears — if a bear is Goldman, Morgan Stanley, and JPMorgan. The question board members at these firms should be asking: How did we let Coinbase happen?

Side note: Coinbase is a broken IPO, closing down 15 percent from the price of the first trade in which anybody could purchase private holder’s shares. The head fake of a “reference price” (meaningless) is a Facebook-like attempt to see if people are stupid enough to believe what you say … if you just say it earnestly. Direct listings have become a transfer of wealth (the “pop”) from institutions to VCs who fling feces at tourists to the Unicorn Zoo.

Anyway, it’s likely that the Wall Street firms, realizing they ceded too much of a head start to compete on the whole “innovation” thing, will weaponize their lobbyists to convince regulators to shift their gaze away from SPACs (harmless fun) and focus on the existential threat(s) of crypto.

Prediction: congressional hearings on crypto where committee members make the previous hearings on big tech look elegant and informed.

What happens next?

A quarter century ago, Netscape went public in a record-shattering IPO, and kicked off the internet era. Similar to Coinbase, Netscape Navigator, the company’s web browser, was an on-ramp to the digital future. And, similar to Coinbase, Netscape’s IPO poked the tech establishment, notably Microsoft, causing board members at those firms to ask: How did we let Netscape happen?

Well, in an AOL-like move (another early on-ramp to the future), Coinbase might unhappen. One of the tenets of crypto is decentralization, which doesn’t bode well for a middleman that charges 1990s-esque fees. (Coinbase fees can be over 4% per transaction, 10x or more the fees charged by competitors.)

The tech evolution that Netscape precipitated changed the world, but the firm no longer exists, and Microsoft is worth $2 trillion. Will history repeat itself? In the category of “Very Much Not a Coincidence,” the founder of Netscape, Marc Andreessen, is the lead investor and largest outside shareholder in Coinbase. Godzilla vs. Kong. I’m not sure who is who … just go with it.

The world today is wealthier, but less stable; more interconnected, but more divided. Ugh, I hate that last sentence. Anyway, that’s what I spoke with New York about (the world, not hate). Below is an excerpt from the interview, and you can get the full piece on the New York website, or on newsstands everywhere.

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Πηγή: profgalloway.com

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