a Better Bubble™
Recently, I re-read through various discussions about the “dot-com bubble.” Surprisingly, it sounded all too familiar. I realized there are many similarities to today's techno-optimism and techno-pessimism around Web3 and Blockchain. We have people hyping up the future promises, while others express concerns about the bubble.
The Dot-Com Outspoken Optimism
In the mid-1990s, the dot-com boom was starting to gather steam. The key players in the tech ecosystem had blind faith in the inherent good of computers. Their vision of the future represented the broader Silicon Valley culture and the claim that the digital revolution “would bring an era of transformative abundance and prosperity.” Leading tech commentators celebrated the potential for advancing democracy and empowering people.
Most tech reporting pitted the creative force of technological innovation against established powers trying to tame its disruptive inevitability. Tech companies, in this storyline, represented the young and irreverent, gleefully smashing old traditions and hierarchies. The narrative was around “the mystique of the founders,” recalled Rowan Benecke. It was about “the brashness, the arrogance, but also the brilliance of these executives who were daring to take on established industries to find a better way.”
David Karpf examined “25 years of WIRED predictions” and looked back at how both Web 1.0 and Web 2.0 imagined a future that upended traditional economics: “We were all going to be millionaires, all going to be creators, all going to be collaborators.” However, “The bright future of abundance has, time and again, been waylaid by the present realities of earnings reports, venture investments, and shareholder capitalism. On its way to the many, the new wealth has consistently been diverted up to the few.”
The Dot-Com Outspoken Pessimism
During the dot-com boom, the theme around its predicted burst was actually prominent. “At the time, there were still people who said, ‘Silicon Valley is a bubble; this is all about to burst. None of these apps have a workable business model,’” said Casey Newton. “There was a lot of really negative coverage focused on ‘These businesses are going to collapse.’”
Kara Swisher shared that in the 1990s, a lot of the coverage was, “Look at this new cool thing.” But also, “the initial coverage was ‘this is a Ponzi scheme,’ or ‘this is not going to happen.’ When the Internet came, there was a huge amount of doubt about its efficacy. Way before it was doubt about the economics, it was doubt about whether anyone was going to use it,” Then, “it became clear that there was a lot of money to be made; the ‘gold rush’ mentality was on.”
At the end of 1999, this gold rush was mocked by San Francisco Magazine. “The Greed Issue” featured the headline “Made your Million Yet?” and stated that “Three local renegades have made it easy for all of us to hit it big trading online. Yeah…right.” Soon after, came the dot-com implosion.
“In 2000, the coverage became more critical,” explained Nick Wingfield. There was a sense that, “You do have to pay attention to profitability and to create sustainable businesses.” “There was this new economy, where you didn’t need to make profits, you just needed to get a product to market and to grow a market share and to grow eyeballs,” added Rowan Benecke. “It was ultimately its downfall at the dot-com crash.”
The Blockchain is Partying Like It’s 1999
While VCs are aggressively promoting Web3 - Crypto, NFTs, decentralized finance (DeFi) platforms, and a bunch of other Blockchain stuff - they are also getting more pushback. See, for example, the latest Mark Andreesen Twitter fight with Jack Dorsey, or listen to Box CEO Aaron Levie's conversation with Alex Kantrowitz. The reason the debate is heated is, in part, due to the amount of money being poured into it.
Web3 Outspoken Optimism
Andreessen Horowitz, for example, has just launched a new $2.2 billion cryptocurrency-focused fund. “The size of this fund speaks to the size of the opportunity before us: crypto is not only the future of finance but, as with the internet in the early days, is poised to transform all aspects of our lives,” a16z’s cryptocurrency group announced in a blog post. “We’re going all-in on the talented, visionary founders who are determined to be part of crypto’s next chapter.”
The vision of Web3’s believers is incredibly optimistic: “Developers, investors and early adopters imagine a future in which the technologies that enable Bitcoin and Ethereum will break up the concentrated power today's tech giants wield and usher in a golden age of individual empowerment and entrepreneurial freedom.” It will disrupt concentrations of power in banks, companies and billionaires, and deliver better ways for creators to profit from their work.
Web3 Outspoken Pessimism
Critics of the Web3 movement argue that its technology is hard to use and prone to failure. “Neither venture capital investment nor easy access to risky, highly inflated assets predicts lasting success and impact for a particular company or technology” (Tim O’Reilly).
Other critics attack “the amount of utopian bullshit” and call it a “dangerous get-rich-quick scam” (Matt Stolle) or even “worse than a Ponzi scheme” (Robert McCauley). “At its core, Web3 is a vapid marketing campaign that attempts to reframe the public’s negative associations of crypto assets into a false narrative about disruption of legacy tech company hegemony” (Stephen Diehl). “But you can’t stop a gold rush,” wrote Moxie Marlinspike. Sounds familiar?
A “Big Bang of Decentralization” is NOT Coming
In his seminal “Protocols, Not Platforms,” Mike Masnick asserted that “if the token/cryptocurrency approach is shown to work as a method for supporting a successful protocol, it may even be more valuable to build these services as protocols, rather than as centralized, controlled platforms.” At the same time, he made it clear that even decentralized systems based on protocols will still likely end up with huge winners that control most of the market (like email and Google, for example. I recommend reading the whole piece if you haven’t already).
Currently, Web3 enthusiasts are hyping that a “Big Bang of decentralization” is coming. However, as the crypto market evolves, it is “becoming more centralized, with insiders retaining a greater share of the token” (Scott Galloway). As more people enter Web3, the more likely centralized services will become dominant. The power shift is already underway. See How OpenSea took over the NFT trade.
However, Mike Masnick also emphasized that decentralization keeps the large players in check. The distributed nature incentivizes the winners to act in the best interest of their users.
Are the new winners of Web3 going to act in their users’ best interests? If you watch Dan Olson’s “Line Goes Up – The Problem With NFTs” you will probably answer, “NO.”
From “Peak of Inflated Expectations” to “Trough of Disillusionment”
In Gartner’s Hype Cycle, it is expected that hyped technologies experience “correction” in the form of a crash: A “peak of inflated expectations” is followed by a “trough of disillusionment.” In this stage, the technology can still be promoted and developed, but at a slower pace. With regards to Web3, we might be reaching the apex of the "inflated expectations". Unfortunately, there will be a few big winners and a “long tail” of losers in the upcoming “disillusionment.”
Previous evolutions of the web had this "power law distribution". Blogs, for example, were marketed as a megaphone for anyone with a keyboard. It was amazing to have access to distribution and an audience. But when you have more blogs than stars in the sky, only a fraction of them can rise to power. Accordingly, only a few of Web3’s new empowering initiatives will ultimately succeed. Then, “on its way to the many,” the question remains “would the new wealth be diverted up to the few?” As per the history of the web, in a "winner-take-all" world, the next iteration wouldn't be different.
From a “Bubble” to a “Balloon”
Going through the dot-com description, and then, the current Web3 debate - feels like déjà vu. Nonetheless, as I argue that the tech coverage should not be in either Techlash (“tech is a threat”) or Techlust (“tech is our savior”) but rather Tech Realism – I also argue the Web3 debate should be neither “bubble burst” nor “golden age,” but rather in the middle.
A useful description of this middle was recently offered by M.G. Siegler, who said the tech bubble is not a bubble but a balloon. Following his line of thought, instead of a bubble, Web3 can be viewed as a “deflating balloons ecosystem”: The overhyped parts of Web3 might burst, and affect the whole ecosystem, but most evaluations and promises will just return closer to earth.
That’s where they should be in the first place.
Dr. Nirit Weiss-Blatt is the author of The Techlash and Tech Crisis Communication
WASHINGTON — Federal government funding runs out in just a week, Congress hasn’t cleared a short-term measure to avoid a shutdown, despite broad bipartisan support — and the latest holdup is over claims the Biden administration wants to pay for crack pipes as part of “safe smoking” kits. The stopgap spending bill passed the U.S. […]
The post Short-term federal spending patch held up by Tennessee senator over crack pipe controversy appeared first on Missouri Independent.
Cops are out there giving each other bad advice. An instructor for Street Cop Training -- a New Jersey based provider of officer training programs -- is telling officers it's ok to run facial recognition searches during routine traffic stops, when not encouraging them to go further with their potential rights violations.
In a podcast recently uncovered by Caroline Haskins for Insider, Maryland detective Nick Jerman tells listeners there's nothing wrong with running a facial image against publicly available databases during a traffic stop.
In a July 2021 episode of the Street Cop Podcast with Dennis Benigno, the company's founder, Jerman encouraged using facial recognition software to determine the identity of the person pulled over. The Street Cop Podcast is advertised as "The training that cops deserve" and, along with Street Cop Training's other programs, is marketed to active-duty police.
"Let's say you're on a traffic stop and we have someone in the car that we suspect may be wanted," Benigno asked during the episode. "What do we do in that situation?"
"Well there's a couple of paid programs you can use where you can take their picture, and it'll put it in," Jerman said, referring to facial recognition tools, before recommending "another one called PimEyes you can use." PimEyes is a free, public-facing facial-recognition search engine.
The legality of running searches like this is still up in the air. If there's nothing beyond suspicion a vehicle occupant might be a wanted suspect, officers would likely have to develop something a little more reasonable before engaging in searches -- like utilizing a facial recognition program -- unrelated to the traffic stop. And in some states and cities, it is very definitely illegal, thanks to recent facial recognition tech bans. Just because the cops may not own the tech utilized during these searches doesn't necessarily make actions like these legal.
But that's not the only potential illegality Detective Jerman (who, as Haskins points out, is currently being investigated by his department over some very questionable social media posts) encourages. He notes that in many states officers cannot demand people they stop ID themselves, especially when they're just passengers in a vehicle. He recommends this bit of subterfuge to obtain this information without consent.
"How about, you're in a situation where you can't compel ID and before you even ask you're like there's something not right with this guy and he's gonna lie," Benigno said.
Jerman suggested getting the person's phone number, either by asking the person, or by accusing the person of stealing a phone in the car and asking if they can call the phone in order to exonerate them.
"[Say] 'I see that phone in the car, we've had a lot of thefts of phones,' say 'Is that really your phone?' and then you can call it to see if that's the real phone number," Jerman said. "If you can get the phone number from your target, the world is your oyster."
Once a cop has a phone number, they can use third-party services to discover the phone owner's name and may be able to find any social media accounts associated with that phone number. The request may sound innocuous -- seeking to see if a phone is stolen -- but the end result may be someone unwittingly sharing a great deal about themselves with an officer.
Detective Jerman also provides classes on how to create fake social media accounts using freely accessible tools. He does this despite knowing it's a terms of service violation and appears to believe that since there's no law against it, officers should avail themselves of this subterfuge option. He has also made social media posts mocking Facebook and others for telling cops they're breaking the platform's rules when they do this.
But far more worrisome is something he admitted on another Street Cop Training podcast:
He recounted that at a wedding a few years ago, his friend wanted to approach a woman in a red dress because he "thought she was pretty hot." Jerman said that on the spot, he did a geofence Instagram search for recent posts near the wedding venue. He found a picture with the woman in the red dress, named Marilisa, posted by her friend, Amanda.
"Then you can start gaining intel on Amanda, then you can go back to Marilisa and start talking to her as if you know her friend Amanda," Jerman said.
Even his host, Street Cop Training founder Dennis Bengino, seemed to consider Jerman's actions to be a little creepy. But that appears to be Detective Jerman's MO: the exploitation of any service or platform to obtain information on anyone he runs into, whether it's at a wedding or during a pretextual traffic stop.
Despite Jerman's insistence that none of this breaks any laws, the actual legality of these actions is still up in the air. The lack of courtroom precedent saying otherwise is not synonymous with "lawful." Cases involving tactics like these are bound to result in challenges of arrests or evidence, and it's not immediately clear running unjustified searches clears the (very low) bar for reasonableness during investigative stops.
However, Jerman's big mouth and enthusiasm for exploitation should make it clear what's at stake when cops start asking questions, no matter how innocuous the questions may initially appear. And documents like the one obtained by Insider -- one that lists dozens of publicly accessible search tools and facial recognition AI -- should serve as a warning to anyone stopped by police officers. Imagine the creepiest things a stalker might do to obtain information about you. Now, imagine all of that in the hands of someone with an incredible amount of power, easy access to weapons, and an insular shield on non-accountability surrounding them.
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