I often hear people call crypto a scam. The biggest argument is “where is the utility?” or “What's it for?”, sometimes I hear “It doesn't actually do anything!”. The one I often hear the most is “the Internet had capabilities instantly… it was useful immediately”. I often thought that was an interesting point of view, if crypto is going to be this big important digital finance thing, then why doesn't it have utility in the first few years of its existence? The Internet and the World Wide Web was this life changing, world altering thing that happened instantly and all our lives changed, right? Well, that's not necessarily true.
I looked into the history of the World Wide Web and the Internet, looking into the comparisons with cryptocurrency to see whether there were any similarities in the growth patterns, and this is what I found.
The History Of Everything
The World Wide Web was created by a British scientist working at CERN, yes that place in Switzerland with the collider. Tim Berners-Lee originally conceived and developed the idea to meet the demand for an automated information sharing system between the scientists and universities around the world. This idea was conceived in 1989 and it's widely considered that he is the godfather of the Internet however that's not entirely true.
Joseph Licklider at MIT computer science room in 1962.
Tim Berners-Lee was not the first person to come up with the idea of connecting computers across the globe. In 1962 J.C.R. Licklider at the Massachusetts Institute of Technology (MIT) first dictated his dream of a ‘Galactic Network’ which connected computers across the globe allowing the free-flowing access of data. Licklider went on to work for the US Department of Defence and specifically the Defence Advanced Research Projects Agency (DARPA). This was the department that coordinated all the original research into what became the Internet.
Without boring you further, two of Lickliders MIT colleagues also went on to join DARPA and in 1967 a gentleman named Laurence G Roberts presented a paper, or in today's terms a ‘Whitepaper’, outlining his vision for the original version of the Internet known as ARPANET.
ARPANET’s first host computer was set up at the University of California Los Angeles (UCLA) in 1969. Other computers were set up Stanford Research Institute (SRI), UC Santa Barbara and the University of Utah in Salt Lake City. They devised a communication protocol that would enable different networks to talk to each other resulting in the host to host ‘Network Control Protocol’ (NCP) in 1970. Those old enough to remember ‘MSN Chat’ this is the same thing, but 30 years earlier.
In 1972 at the International Computer Communication Conference ARPANET was first demonstrated publicly. That same year the first major Internet application called electronic mail or e-mail was introduced. Over the next decade, slowly other applications were added to the ARPANET system.
That is the birth of the Internet. If you want to read up about what happens between the 70s and the 90s, you're more than welcome to do so, but I won't bore you with that in this article.
During the 1980s the methods of the ‘Domain Name System’ (DNS) had become a way of finding the person or organisation you wanted to communicate with, and by the 1990s Tim Berners-Lee had come up with the concept of a World Wide Web.
Tim Berners-Lee at CERN with his new World Wide Web.
There are a lot of pieces in the new World Wide Web puzzle one of them was hypertext markup ‘HTML’, which was the codes built on hypermedia principles dating back to the 1940s. This informs the browser how to interpret the files for the website and allows the screen to display the site. Berners-Lee also devised the ‘Universal Resource Locators’ (URLs) to allow each specific page of the World Wide Web to have an exclusive name or URL. In 1991 he released the World Wide Web, from his laboratory in CERN, to the public, free of charge.
What happened next was the ability to view incredibly slow loading images, text and information on incredibly slow computers. Some of you might remember what dial-up was. Before Google, we had things like AOL to connect to the Internet. We used to have to press the button on the screen and then it made this horrible squeaking noise for about two minutes. Then you were connected to the internet. Then every time you wanted to change page it took two minutes and if it had an image on it took even longer. I remember the first time I saw the Internet in 1996 at my friend Graham’s house, it blew my mind but also I remember the distinct feeling of boredom waiting for each page to open.
I believe people forget the shoulders on which Tim Berners-Lee stood, and the amount of time it took to get the idea of the ‘Galactic Network’ from Licklider in 1962 to the 1989 dial-up World Wide Web. It took 30 years from the first usage of the Internet to mass adoption in the 90s. It took until 2007 before half of all Internet users were on broadband after dial-up service. I would argue that the Internet’s full potential didn't come to fruition until broadband.
To evaluate the impact of the internet on society, from its inception, you can either go from 1962 to 2007, which is 45 years, or 1991 to 2007, which is 16 years. If I was being biased, I would say let's start at the beginning because the first whitepaper for the internet was in the early 60s and the first whitepaper for crypto was 2008.
I would argue that crypto has shown more utility in its first 15 years than the Internet did between 1960 and 1975. However, let's use the 16 years between the beginning of the World Wide Web and the start of broadband services.
From Satoshi Nakamoto’s initial Bitcoin whitepaper, crypto has been called a scam, it has been laughed at, a gentleman tried to buy a single pizza for 10,000 Bitcoin and got rejected. People have questioned its utility, why does it exist? what is the point? I would like to detail some of the utility that cryptocurrency and blockchain has created for the world to use and how much it has been utilised already by international companies in its first 15 years since inception.
Blockchain & Securing Digital Assets
I believe the world laughs at the term NFT. I believe people find it very easy to laugh at things they don't understand. When you use the term NFT people assume it's a picture of a monkey that Justin Bieber lost $1,000,000 on. They believe it's a picture that you can just screenshot. The reason why people laugh is because the mass media have spent the last few years denigrating the name of crypto and NFT's. However, understanding what an NFT is, its utility, you suddenly start realising what its capabilities are and how companies all over the world are starting to use them.
A non-fungible token on a blockchain is a way of proving ownership of something digital. When was the last time you booked a ticket anywhere in the world? A plane ticket, a hotel reservation, a cinema or theatre booking, sporting occasion or music event and the ticket was posted to you in paper form. It’s not anymore.
If you purchase a ticket for a World Cup match, FIFA ask you for your passport details, for your address, date of birth, gender, telephone number all of which is designed to stop the scalping or selling on of tickets because there is no way of proving the ticket belongs to you. What would happen if that ticket was an NFT on a blockchain? None of your private data would be taken, no passport, no address, no date of birth, no telephone number, no information to sell to their affiliate marketing companies and all the other stuff they do with that info.
With blockchain none of this would happen, you would receive an NFT, a digital ticket, on the blockchain, which you could prove belongs to you without having to provide all your private information. This is how NFT's on the blockchain will change the world. Most people won't know that their ticket is an NFT, the seamless way that companies are changing their online ticketing system will only be noticed by the lack of information you need to input when you purchase a ticket anywhere for anything. This will happen before 2030.
Argentina maxed out at 142% inflation in 2023.
Hedging Against Inflation & Payment Systems
We all have a debit card or credit card which is hooked up to Apple Pay or Google Pay. Every single transaction you make with these goes through a bank, a middleman which you have to pay, if you're sending overseas it costs, if you want credit cards it costs. What if you could send a value or money, any amount, to anyone in the world, for five cents? A zero fees payment system and you don't have to pay anyone to use it and it's that system is virtually free. That is one of the goals of crypto.
In Argentina and other South American countries, they've seen a rise in inflation which means the average household can no longer afford groceries for the week or to put fuel in their car. In African countries like Sudan, Angola and Middle Eastern countries like Iran and Pakistan, even in European countries like Türkiye, they have all had huge inflation during 2023. FIAT currencies are susceptible to rate hikes by central banks, whereas a store a value like Bitcoin is worth one Bitcoin, no matter what the central bank does with the interest rates.
In 2008 we had the financial crisis. Millions lost their homes, their jobs, their lives, and in the 15 years since, interest rates grew to 9% in the US and the UK. Millions more losing their homes because they can't afford the repayments, due to central banks raising the interest rates. So, we currently live in countries that don't care about its citizens, that uses citizens as cash cows and taxes everything, misappropriates those funds and then raises taxes and rates to recover their poor choices. Wouldn’t it be safer to have a digital finance system that secures you and your family against the possibility of your government’s legislation swiftly changing, which in turn means you can't afford your home or groceries, this is where cryptocurrency comes in.
I can travel around the world with digital wallets or access to one of the exchanges I trade on and store 2 Bitcoin, 5 ETH, some MATIC, some SOL and then liquidate some crypto for FIAT if needed and watch the crypto’s value grow with time. Instead of being paid in FIAT to find a loaf of bread is now $4 when it used to be $3.
Now people will say well the world is based in Pound Sterling, USD & Euro etc… so eventually you do have to liquidate your crypto to spend in the real world. I completely agree, I do at the moment. But one day I will be able to pay with my Ethereum or Polygon card. Polygon has signed a deal with Mastercard in 2023 to work on a crypto payment system. That crypto’s value will always be 1 to 1. No central back will be able to change that.
However, if I work and get paid $1000, that $1000 sits in a bank account at 0.2% interest. The government decides to raise rates, in turn, my local grocery store needs to raise their prices to survive and that $1000 is now worth less because it buys me less.
My crypto will only be worth less if you compare it to FIAT currencies. In 2023, all major central banks are working on CBDCs, Central Bank Digital Currency. The banks are creating stablecoins. Yes, they are linked to the value of their currency, but it’s not a huge leap to see the world change from excepting payments in CBDCs to Cryptocurrencies. The infrastructure will be built quickly, thus will already be there. Accepting Ethereum or Polygon as a payment method will be as simple as changing from chip and pin on your credit card to Apple Pay.
Memes about the terribly slow dial-up internet in the 90's.
Conclusion
In the first 16 years of the Internet, they managed to send messages using computer codes between Stamford university and UCLA. In the first 15 years of crypto they've managed to hedge against inflation by using a new digital finance system and a new secure system for the ownership of all digital assets using blockchain technology.
In a way the World Wide Web in its first 16 years revolutionised the way people in the 90s thought about the world. Communicating via messaging services, sending pictures, reading newspapers, all online. It was incredible. However, the true revolutionary period of the Internet happened after 2007 when the world had broadband. When we could utilise the technology correctly, what we're talking about is mass adoption. In 2023 there were 420 million users of crypto. In 2007 there were 4 billion users of the Internet. So, the world wide web took off faster, but why?
Zero risk, that's why. Signing up to the internet was easy. Crypto by its very nature is anti-establishment, meaning to get access to an exchange and to trade crypto is a lot of effort. To get a digital wallet is a lot of effort. To purchase an NFT is a lot of effort, and it's only when the whole process is simplified by companies like Coinbase who offer a very simple service, will the uncomplicated masses enter.
Money is pouring into crypto right now. If you've read any other of my articles, you'll know that BlackRock and many others have bitcoin Spot ETF's coming. Ark & BlackRock and a few others have Ethereum Spot ETF's pending and there will be many, many others over the course of the next few years. This will bring traditional trading money into the crypto world, and it is estimated that the crypto market cap would be well above $5 trillion by the end of this current bull run.
So, the comparison of “…well the Internet took off quickly and crypto isn't, so what's crypto for?” is honestly a nonsense comparison, it's apples and oranges. The Internet had been developed for 40 years before mass adoption and once mastered, it boomed. Crypto has been around for 15 years and it's already booming. It has a lot of lessons to learn before everyone in the world uses it like they use the Internet today. But to call crypto a scam because it has no utility is rubbish and a completely uneducated view.
It’s like calling the internet a scam in the 70s because you needed a computer that took up an entire room in your office. Technology evolves, habits change, crypto is in a better place after 15 years than any other industry from its inception.
I hope one day I don't have to write articles defending crypto and simply just praising it for what it is. That’s because for the first time people created something by themselves, for themselves, which benefited themselves, and cut out the greedy people in power in the process. That should be something that’s applauded, not abused.
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