Zhu Weisha November 21, 2024
Satoshi Nakamoto established the Internet Age
It is the last article in this series of five articles, based on my speech at the W2140 Cryptocurrency Conference. The article "Conservatism is a misunderstanding of Trump, MAGA is the practice of advanced production relations" points out that there have been agricultural, industrial, and Internet eras in the past thousand years. The characteristics of the farming era are whoever has more land has the advantage, whoever has more capital has the advantage in the industrial era, and whoever has more people has the advantage in the Internet era. The agricultural era formed a totalitarian society, and the industrial era formed a democratic society, so what kind of society is the Internet era?
The Internet is divided into Web1, Web2, and Web3. In this series of articles, "Discussion on the Definition of Web3," I defined Web3 as click, push, and ownership. In Web1 and Web2, data is not owned by individuals, while Web3 clearly proposes that individuals own personal data. Web1 and Web2 both continue the architecture of the industrial era and solve the productivity problem. Only Web3 is different, involving not only productivity but also production relations.
Only the change of production relations is the sign of the change of The Times. The industrial era began in the middle of the 12th century. After more than 400 years of exploration, predecessors found a system structure suitable for industrialization, which led to the Industrial Revolution in the 18th century and rapid economic growth. Due to the financial revolution brought by Bitcoin, the fundamental change of production relations since the industrial age, which is the sign that human society has truly entered the Internet age.
So,the emergence of Bitcoin is a turning point in this new era. There are only four Bitcoin system maintainers and almost no management fee consumption. Still, its market value has reached 2 trillion US dollars today. It is unimaginable, considering the thinking of the industrial age. So, Satoshi Nakamoto established the Internet era.
What are the characteristics of the Internet?
The Internet's characteristics are borderless, hierarchical, frictionless, barrier-free, and rapid point-to-point transmission. The above characteristics can be represented by one word: equal rights, which is the Internet's fundamental characteristic. Everyone uses the Internet as a boundary rather than a national boundary. Apparently, hierarchical industrial thinking is unsuitable for the Internet's underlying structure.
What kind of system structure should the Internet era have? We don't know. Fortunately, we have experimented with cryptocurrency. In the past 15 years, the unconstrained cryptocurrency thinking has started from the "tribe." It has gone through thousands of years of human development. We do not have targeted theories, but we do have practice. Summarizing the experience of cryptocurrency may be inspiring and instructive for the future social form. The election of Mile in Argentina and Trump in the United States are signs of the transition of the times. They adhere to Hayek's free market economics and rely on intuition. Their slogans and actions represent the trend of the future. To follow the historical trend instead of suppressing it, we must first figure out the characteristics of the Internet era established by cryptocurrency. In summary, there are probably five points.
Personal sovereignty
Personal sovereignty refers to personal data ownership. You control your own money instead of the bank; you decide how to use your own information instead of letting a third party control it. However, there is still a difference between ownership and control. Bitcoin users have control over their accounts, which is equivalent to ownership. However, in the Bitcoin ledger system, users do not have control, while programmers control the ledger. The programmer's control must be restricted; otherwise, the user's account control is incomplete.
Personal sovereignty strengthens the individual rather than the collective. At the beginning of Web1, those individuals with extraordinary wisdom, outstanding ability, and ambition could start from scratch without capital. Internet celebrities and big Vs, the ideas in their minds are the source of wealth. The White House of the United States issues interview passes to influential self-media and individuals because self-media and big Vs are no longer inferior to traditional media. Musk's followers have reached over 200 million, and his influence exceeds that of any TV station. Trump's team understands the Internet era better than its opponents. In 2016, Trump made good use of Twitter, and there was a saying that Twitter governs the country, making the government's will public. In 2024, Twitter became his campaign weapon. Polymarket, a new type of institution, reflects public opinion more accurately than a century-old store. An accurate grasp of the Internet has reduced Trump's campaign costs. More money is an advantage, which is the thinking of the industrial age.
Web3, institutions are obviously shrinking to the core team, and peripheral contributors are increasing. Musk's efficiency department conforms to this law. There is no salary for gathering like-minded revolutionaries. Individuals work for interest. It refers to the core team. The contribution assessment of peripheral contributors mainly depends on market assessment.
Another thing to say is that rewards should be provided without wages, just like YouTube broadcasters need automatic evaluation and incentives. The internal officials know the situation best and see where the problem lies. Can they be mobilized without rewards?
Both dictatorship and the tyranny of the majority will encounter foot voting because project selection is too easy. If I am not allowed here, I will be allowed to work anywhere. The law is based on the country, but a centralized Binance is a globally distributed office, and the old supervision encounters new problems.
The biggest problem for the country is the tax problem. The original tax mechanism of the industrial era is definitely outdated. The Internet era cannot support a large government, forcing the government organization to shrink. Taking the United States as an example, the global economy will be liberated from the firm control of politics and operate according to the characteristics of the Internet era. The benchmark role of the Bitcoin system is that it does not require government management, Bitcoin does not need to be kept by banks, and individuals take care of their own affairs. Social management will be simplified. How should taxes be determined at this time?
In the Internet era, individuals must be responsible for themselves, and the number of freelancers has increased significantly. It is entirely different from the habits of the industrial era. Doing a job may be far from enough.
Transparency
Musk is well-versed in the ways of the Internet era and has implemented the concept of transparency in his efficiency department. Transparency is the core concept of the Bitcoin system. Transparency is the source of trust. Is there still a need for management if it is transparent? Market supervision replaces power supervision. Whether decentralized or centralized, you have credibility as long as you are transparent. Musk's efficiency department is a centralized organization. It is transparent, and whether it is fair is left to market supervision. Therefore, decentralization is not the core concept of cryptocurrency.
This efficiency department conforms to the principle that the core organization is small and the peripheral organization is large. For example, the programmers who maintain and upload the code to the Bitcoin system are all volunteers. The peripheral systems involving Bitcoin are as numerous as stars.
It cannot be tampered with
Transparency can still be changed, but as a ledger, there is a stricter requirement that it cannot be tampered with. Only in this way can it be trusted. It is a hash value, not necessarily the blockchain, which guarantees it cannot be tampered with.
Sticking to decentralization and blockchain significantly limits our thinking. Musk starts from the first principles and adopts all three of the above points in the efficiency department. He does not use decentralization or blockchain and is not an expert in cryptocurrency. He can make a lot of money because he perceives how things develop.
Fairness and Justice
The system you design must be fair; otherwise, no one will play. A centralized system must also be Justice, and it is based on openness. Bitcoin's core characteristics can be summarized as openness, fairness, incentives, and immutability. Cryptocurrency can be extended to centralized projects. At this time, Justice must be added. Community autonomy must also be added as a feature of the Internet era.
Community autonomy
After Satoshi Nakamoto left, programmers developed community autonomy. These programmers are excellent, and they have continued a new era.
The Bitcoin system requires trust, but the object of trust is different. Trusting a third party is unnecessary, but you must trust programmers. For the system to progress, there must be a controller. Fortunately, relying on human wisdom, the Bitcoin system has evolved to community autonomy.
The form of community autonomy is critical. The community should be the highest institution for coordination and decision-making among all stakeholders. Because, as a whole, they directly and indirectly "own" this project, just as the people "own" the country and shareholders own the company. Note that "ownership" can be very real or virtual and does not mean control.
The community is not a new thing, it also exists in web2 projects. For example, the WeChat and Facebook communities but do not have community governance. The Bitcoin system is different. The Bitcoin community has control and has formed the principles of openness, transparency, and consultation. The Bitcoin community is not perfect because it does not cover all stakeholders. Chris Dixon said, "Digital assets are the link between builders and users." In other words, this is the fundamental difference between the web3 community and the web2 community, and it is also the primary advantage of web3 over Web2. Of course, the community is not reflected in the definition of Web3.
The community control and decision-making of cryptocurrency are advanced. It is the decision-making method that a masterless system should have. Generally speaking, the country is also a masterless system, and civil servants are like programmers in the Bitcoin community. It is an advanced method to adopt similar decision-making mechanisms and incentive mechanisms.
Should we use the form of community to make cryptocurrency policies open, transparent, equal participation, and consensus? We see that whether it is the SEC or the Hong Kong Financial Secretary, you can write to them to make comments, and they reply that they have received it, that's all. Users cannot participate in decision-making or see what opinions and requirements the market has raised. Their understanding of the Internet is still the Web1 model and the thinking of the industrial age. Users have no right to dialogue at all.
In the Bitcoin community, Satoshi Nakamoto participated in customer service for 2 years. He listened to opinions, solved problems directly, and left only when the system was stable. It is a requirement for the actual controller of the project or the decision maker. Satoshi Nakamoto must also listen to the community's opinions as an expert. Musk, a genius, also needs to listen to the community's views. Regulatory authorities sometimes have the ultimate control. Can some of today's big masters solve brand-new problems that they don't understand very well just by slapping their heads? Gary Gensle of the SEC manages cryptocurrencies with the thinking of the industrial age, reflecting that he is not as good as Trump and Musk in understanding the Internet era. Suppose the managers of cryptocurrencies do not understand the community and the Internet of Things era. How can they manage cryptocurrencies well?
Postscript
Due to the limited space, please refer to the third chapter of the chainless white paper "Community Governance and Indirect Incentives" and the discussion on community autonomy in "What is missing from the current definition of Web3 from the perspective of Bitcoin?"
Based on the above five points, we designed the general community software SimiTalk for communities with currency as the bond. It connects the public and private domains. The official group has no limit on the number of people. Private chats do not store data. Currently, the user group supports bilingual functions (Chinese and English) and automatically displays the user's native language. The software is still being iterated and can be downloaded from the Apple and Android app stores.
Are the above five points the critical points of the Internet era? I don't know. The social structure of the Internet era needs to be iterated and explored, and it cannot be summarized in one sentence. What kind of society should transcend democratic society? I prefer a fair society. But does a fair society really exist? I believe it does.
In the article "From a peer-to-peer cash system to a bubble-free financial system," I explained that a bubble-free financial system could be achieved using Bitcoin standard. At that time, there would be no inflation, morality, and kindness would return, and this would be an ideal world. Utopian socialists have pursued it, Hayek has pursued it, and cypherpunks have pursued it. Their ideas are more grounded than one another. Fortunately for humanity, the Trump team, representing the Internet era, has won, and the Internet era has arrived. We are closer to the goal of achieving a fair society.
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