I'm very much a beginner when it comes to crypto-currencies. That being said, I'm trying to learn what I can, and recently found an interesting connection between two writers -- separated by about 20 years -- pointing out where the real functionality in Crypto assets lies.

What Good Are Crypto Assets Anyway?

The first comes from Adam Ludwin of Chain. He writes a brilliant summary of what crypto-currencies really are in a way that most people like myself can actually understand.

The entire thing is worth a read. But here's the part I'm really focused on, where he describes just how awful the real utility of crypto assets and the underlying blockchains really are:

In fact, on almost every dimension, decentralized services are worse than their centralized counterparts:
- They are slower
- They are more expensive
- They are less scalable
- They have worse user experiences
- They have volatile and uncertain governance

And no, this isn’t just because they are new. This won’t fundamentally change with bigger blocks, lightning networks, sharding, forks, self-amending ledgers, or any other technical solutions.

Bottom line: centralized applications beat the pants off decentralized applications on virtually every dimension.

This is huge shade being thrown at crypto by someone who works in the industry. And he's right: Steemit's interesting, but because of network effects, if I want to find out what's going on in the world or with my friends, I'm probably going to visit Facebook or Twitter. And -- as he states -- PayPal is easier to use than Bitcoin, so what's the big deal anyway?

Ludwin ends with this, though:

EXCEPT FOR ONE DIMENSION.

And not only are decentralized applications better at this one thing, they are the only way we can achieve it.

What am I referring to?

Censorship resistance.

This is where we come to the elusive signal in the noise. Censorship resistance means that access to decentralized applications is open and unfettered. Transactions on these services are unstoppable.

Obviously, this is what makes it so popular with libertarians -- no state control. That being said, it's hard to see how this could truly live up to the hype, until...

A 20 Year-Old Book That's Predicted a Ton of Stuff Correctly...Even The Rise of Donald Trump (in a sense)

The Sovereign Individual was written in 1997, which is pretty astounding. As an aside @heymattsokol has a great summary here That's because the book predicted a ton of stuff that has actually come to pass:

• The rise of remote working.
• The middle-class being squeezed by automation
• Banks suffering through a crisis far greater than 1987 (Great Recession)
• The end of jobs in favor of at-will, free agent employment.
• The rise of crypto-currencies.

There's a lot that hasn't come to pass from their predictions either, and I have some strong disagreements about the reasoning, but that's for another time. The real premise of the book is this: The nation-state will cease to exist in the Information Age.

That's the premise for everything. It's an appealing proposition for libertarians, but also for those who consider themselves Localists in the lines of the teachings of Nassim Taleb.

The authors of The Sovereign Individual use the collapse of the Church as a proxy for the collapse of the nation-state, describing it thus:

"The capacity to mass-produce books was incredibly subversive to medieval institutions, just as microtechnology will prove subversive to the modern nation-state. Printing rapidly undermined the Church's monopoly on the word of God, even as it created a new market for heresy. Ideas inimical to the closed feudal society spread rapidly, as 10 million books were published by the final decade of the fifteenth century.

Because the Church attempted to suppress the printing press, most of the new volumes were published in those areas of Europe where the writ of established authority was weakest. This may prove to be a close analogy with attempts by the U.S. Government today to suppress encryption technology.

Make the connection, and you have the key signal in all of this: it's plausible that the rise of crypto assets could be the death of nation-states.

Even if the bubble around crypto pops -- which some like @boxmining have covered and many lose interest -- there's a key signal to attend to from all the noise as of late: the fact that crypto will likely remain a viable alternative to use in the event that nation-states breakdown makes it an extremely anti-fragile asset to hold.