What Year in Blockchain Are We Compared to the Internet?

If you were around during the 1995 Netscape IPO and the following dot-com bubble beginning in the year 2000, you may say the euphoria around blockchain feels the same way right now: “There’s going to be a new world with pet unicorns, everyone will be each other’s best friend, and there’s going to be infinite abundance!” Despite these shortcomings of the internet, it has certainly revolutionized our access to information, how we connect, and the overall functions of our day-to-day lives. It indeed has been a new world.

Does that mean in terms of internet years, blockchain is in the year 1995? I’d say 2017 felt like 1995. The ICO boom as a result of ERC-20 tokens made finance headlines from the massive raises and Bitcoin futures hitting CBOE put the cryptocurrency in the living room of everyday people.

Now the dust has begun to settle: ICOs aren’t raising what they used to, the crypto market at large is at a low compared to 2017’s hysteria, unsuspecting retail investors already have been burned, and the next big break in blockchain is unclear. So where are we now?

It feels like 1996.

By 1996, Bill Gates had already sent out the internal memo rallying his Microsoft army around launching a single-minded attack on the web browser market the year before. Remember, Microsoft had been dominating computer software for the past ten to fifteen years, and Netscape managed to open a 3 billion-dollar IPO sixteen-months into its founding without yet being profitable (unheard of back then) introducing the mainstream to the wonders of the internet.

However, Netscape’s success was short-lived. With the ability to bundle Internet Explorer as part of the Microsoft Windows package (the OS dominant on all computers at the time), we now all know who won the “Browser Wars”.

The parallel I see in blockchain is between Bitcoin and the banks. Blockchain is not just a technological revolution it is a financial revolution. The bankers who say “blockchain” not “crypto” either don’t understand how the technology actually works or are intentionally promoting their own agenda.

Regulators can’t shut Bitcoin down as it is not centralized. But Wall Street can do what it does best: control the markets. Unlike the headline-hitting browser war Microsoft and Netscape gave the public, this seems more like a coup quietly creeping. Established financial institutions are investing in startups that can more closely associate themselves with the new crypto markets. Incumbents in the sector are leading implementation of regulation. And most notably, they played on the FOMO of the public by hyping up the price of Bitcoin with the introduction of CBOE Bitcoin futures (literally Bloomberg would not stop talking about it) fanning the bubble at the public’s expense and I suspect for their own gain. The typical pump and dumpers of the crypto markets are utter amateurs compared to the sophistication and scale in the way Wall Street does it.

If I thought the CBOE move was chess mate, we’d be in 1998 when Netscape filed for bankruptcy and Microsoft called their victory. However, that was more like wiping out a row of pawns.

Besides, EBay would have made their IPO already while reinvigorating the dot-com craze that year. And we don’t have our new innovator yet making splashes large enough to catch the public’s eye. Eos, Cardano, and Hashgraph are gaining traction in their circles — despite the former two having not released their product yet. Which is why I say it feel likes 1996 or 97.

But really, we are in the 70s, 80s, 90s, and 2000s all at once!

People forget the internet was developed by the US government internally in the 1960s. It spread among academics and governments internationally in the seventies while the developers determined how to scale the technology and develop applications on top of it. Businesses were introduced to internet technology in the eighties opting to create LANs, the equivalent of private blockchains. And the US government started funding the building of its nationwide infrastructure around the same time, which continued into 1995 before they initiated a plan to privatize it.

Furthermore, not until search engines got involved, did the industry figure out how to monetize it. In contrast, we have creators of ICOs, utility tokens, and cryptocurrencies getting “crypto-rich”. I don’t think we’ve discovered Google Adwords yet, but the type of iteration that occurred in the battle of the search engine of the early-2000s is happening now. As a result, in terms of blockchain, we are actually in the 70s, 80s, 90s, and 2000s simultaneously.

Blockchain is figuring how to scale, develop early applications, rebuild private and public infrastructure, and commercialize it — all together! Rather than decade by decade. And this time, it inherently rethinks our finances while putting over $500B of everyday people’s money on the line if you consider the market capitalization of cryptocurrencies. Plus, the government wasn’t behind its origin so they don’t know how to regulate and respond to it. Ironically the blockchain wild west would not have been possible without the internet that allows for this circus of activity.

What to look forward to

Yes, saying, “there is a lot of noise in blockchain,” is an understatement. But with all the moving pieces occurring at once, this makes sense. For each component and market of the internet during the dot-come bubble, most were outright scammers or misinformed opportunists; however, there were dozens of legitimate players vying to be the X solution of the internet. But their timing was off, or they didn’t have the right team, or their product just wasn’t good enough to make them known to us now. The infamous pets.com as the poster child of the dot-com bubble was an online shop to buy pet supplies. Yes, overvalued but Amazon’s all in that business right now.

Although this process can be messy, wasteful, and, at times, brutally unforgiving when the bubble pops, it seems to be the way humans and markets operate in this survival-of-the-fittest world. It’s how we seem to discover who really has what it takes to sustain themselves. Oh, but I thought blockchain would create a new one where the laws of human nature, economics, and physics don’t matter. I guess, we’re still figuring out the bugs.