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Thursday very big mailbag

Q: Will Iggy Azalea take crypto mainstream?

I was a little dismissive of Iggy in last week’s mailbag and that was unfair — this week she went crypto native by giving her memecoin utility (with payments) and hinting at bigger ambitions (she’s hiring developers).

Still, I don't think celebrity memecoins is what brings the masses to crypto — I think (and hope) it will take a use case with more evident utility than that. 

But if nothing else, Iggy’s successful $MOTHER token is a demonstration of crypto’s one indisputable use case: permissionless capital markets.

Iggy is using those markets to monetize the attention that she’s so good at attracting, and that is particularly relevant in the age of the attention economy.

But we still need to ensure it’s not the only way we’re relevant.

Q: Does anyone care about privacy?

The lesson from Web2 was that no one does — consider Venmo, which people like because it broadcasts their spending habits to the world.

But Apple seems to think that might be changing. 

At its annual developer conference this week, Apple made a “verifiable privacy promise” as part of its “Private Cloud Compute”: Your AI searches will be processed either locally on your phone or anonymized on its servers, which will run on transparent, auditable code.

It all sounds very crypto-y! 

It’s hard to tell how much they mean it, though — Apple makes its money by selling hardware, not collecting data (they sold you a $1,000 phone so they don’t need to harvest your data too), so it doesn’t cost them anything to promise privacy.

But they might be onto something — we don’t mind giving our data to Facebook or Google, but we probably do very much mind giving it to our future robot overlords.

If so, people will get a lot more interested in crypto, because running your AI searches on a decentralized protocol is probably the best way to keep them private.

Crypto really does fix that.

Q: Is it bad UX that’s stopping crypto from going mainstream?

Maybe — the defining crypto user experience of seed phrases and browser extensions is terrible.

That might have changed this week, however, with an update of TipLink, a “web wallet” for Solana.

With a web wallet, there’s no seed phrase to write down (and then lose), there’s no browser extension that annoyingly closes every time you click away, and there’s nothing to download. 

You can open a wallet on your phone with just a Gmail address and then it’s there on your laptop when you open your Chrome browser (after years of fiddling with apps and extensions, it kinda feels like magic). 

Helpfully, you can lose both your phone and your laptop without losing your crypto.

And you can send crypto to someone with just their email address — they don’t need a preexisting crypto wallet to receive it.

The experience is so different from the normal (very annoying) crypto experience that it reminded me of using an Apple Mac for the first time way back in 1984.

Using a Mac didn’t feel like using a computer (no command line!) and using TipLink doesn’t feel like using crypto (no seed phrases!).

That’s a good thing, of course — crypto will never go mainstream if seed phrases are required.

Weirdly, though, it sort of feels like a bad thing to me too.

Before the Mac, what you did with computers was try to figure out how to use them — navigating a computer via command line was a fascinating, mysterious process. 

Once the command line was abstracted away, however, the mystery lifted and it was immediately obvious that there wasn’t much else to do with computers in 1984 — one critic called the first Mac “the world’s most expensive Etch A Sketch.”

($2,500 was a lot of money in 1984.) 

TipLink has similarly abstracted away the mysterious process of digital wallets to the extent that it takes just a few clicks to get started in crypto, which is amazing.

But then what do you do?

Trade some memecoins, I guess.

Q: Will crypto do anything societally beneficial?

It seems like even crypto natives are increasingly questioning that — we really don’t want Iggy Azalea to be the reason people come to crypto.

We want them to come for Vitalik, who helpfully enumerated some of crypto’s non-memecoin use cases this week.

With the exception of his first example, however, the list feels a little thin-gruel to me.

I certainly see the hope for zero-knowledge (zk) proof reputation and identity. Crypto seems like the only real way to prove your humanity online and if so, that alone should be more than enough to justify crypto’s entire $2.5 trillion market capitalization. But we’ll probably have to get substantially closer to the robot takeover for people to be worried enough about identity to get interested enough in crypto.

Cross-border payments? I don’t know. You still need centralized exchanges to swap your crypto for fiat, which makes the whole experience janky and expensive (not to mention KYC’d).

Decentralized social? Not many care to own their social media data, and rightly so — the cat pictures you post on Facebook have no value outside of Facebook and your history of likes on X has no value outside of X. Also, interest in Farcaster seems to be fading.  

Prediction markets? These seem unlikely to catch on outside of presidential elections — we generally don’t want to wait any longer than the length of a sporting event to find out if we’ve won or lost a bet. Betting on things weeks or months in advance isn’t much fun.

Privacy? Maybe! See notes on Apple above. 

Enterprise apps? Yes, Coinbase is making a little money with its layer-2 blockchain, Base. But do permissionless blockchains have any appeal for corporations outside of crypto? Possibly, but we haven’t seen it yet.

Zk censorship-resistant voting? Imagine the conspiracy theories if an inscrutable zk proof algorithm declared the winner of a close election in a US swing state. I suspect Americans would rather have paper ballots miscounted by humans than have crypto ballots correctly counted by zk proof algorithms.

The bottom line, though, is that the societal value of crypto remains mostly speculative at this point.

But the Mac was a big hit in 1984, even though there wasn’t much to do with it until Tim Berners-Lee invented the World Wide Web in 1989.

Crypto is in a similar spot — we still don’t know what “very big and very good” things permissionless blockchains will be used for.

At least we have memecoins to keep us busy while we wait to find out. 

— Byron Gilliam

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