Hey, Baratunde here.
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Today, as promised, I’m sharing my thoughts on Bitcoin, blockchain, and whether crypto can provide a pathway to financial freedom for communities that have struggled to build intergenerational wealth. Is blockchain a technology that will disrupt Wall Street, or just another tool for Wall Street to win?
I’ll be discussing it all with my colleague William D. Cohan, a former M&A banker, during an off-the-record call for Inner Circle members later today. If you’re interested in joining, you can upgrade your membership by emailing email@example.com.
See you in the metaverse,
My father’s parents abandoned South Carolina for Washington, D.C. in the 1940s because the racism there was so unbearable and the cost to remain just too high. Later, my mother was basically forced to sell our home in D.C. because the crime was so out of hand, and she legitimately feared for my safety. I did not inherit any property or financial investments. My inheritance came in the form of stories, advice, a great set of LPs, and an early tech literacy which set me apart from many of the other Black kids I grew up with.
I’m pretty sure we were the first family on the block to have a computer, and even when I transitioned to private school and my peer group became much more white and wealthy, I possessed more technological know-how than most of them. That exposure shaped my life. Tech gave me a leg up on research and job opportunities, gave me a creative outlet for my comedy and writing, gave me a sense of usefulness when I was able to help friends and family with something tech-related. I played the role of their own personal Genius Bar.
I have loved tech for a long time. I’ve embraced the changes it enables and enjoyed working through its puzzles and challenges. I’ve also grown increasingly disappointed with the ways Silicon Valley has accelerated tensions in society, from the concentration of wealth to the coding of algorithmic bias to the amplification of polarizing voices in our public discourse.
In most of the technology-rich rooms I’ve inhabited, I’ve been the only or one of the few Black people present. This was true when I beta-tested Windows 95 for USA Today back in 1995; true when I was active at the Harvard Computer Society as an undergraduate; true when I attended the Consumer Electronics Show in the early 2000s on behalf of my consulting firm’s clients; true when I spoke about Web 2.0 onstage at SXSW in the early 2010s. It was rare and special to find other Black folks in these spaces—I still am connected with folks I met through the Blogging While Brown conference, back when blogging was a new digital media frontier.
And so it was only natural for me to become interested in the next wave of connected technologies emerging under the banner of web3 and crypto. I remember the first time I heard about Bitcoin. I was attending an “unconference” in the summer of 2011 called FooCamp. “Foo” stands for “friends of O’Reilly,” as in Tim O’Reilly, creator of the tech publishing company that hosted the small gathering. There were no more than 150 people present, and we literally camped out on the lawn and hills surrounding the building. I ran a small session on “The Singularity vs Peak Oil” to provoke an argument about whether the future was going to be utopian or apocalyptic. The answer: yes.
But what stands out most today is that in a small conference room at the O’Reilly headquarters, I attended a session about cryptocurrency. At the end of the session, the person leading it gave us all some Bitcoin. We had to install special software on our computers. I vaguely recall seeing hexadecimal text and thinking that it looked like an encrypted email signature. I felt cool and super nerdy, and then I forgot about it. A few years later, I got rid of that laptop, and before trading it in, I thoroughly wiped the hard drive in an act of quality digital hygiene and information security. A few years after that, the world really started talking about bitcoin, and the prices were through the roof. I had deleted possibly $100,000 dollars. Is there a version of FOMO that describes having been there, and then walking away, before “there” was the cool place to be?
It felt like a missed opportunity. I had been around tech my entire life, but I hadn’t gotten wealthy off of it. Sure, my life was made richer by the human connections, intellectual stimulation, and fun I was having. I could point to jobs and other opportunities that my tech knowledge had afforded me, but it wasn’t a substitute for real financial wealth. For most of my adult life, my net worth had been negative or approaching zero, and here I had thrown away the equivalent of a small house. When I would speak to groups of young Black students, and they’d ask, “What advice would you give younger you?” I always said, “I wish I had bought back my childhood home or purchased something in Brooklyn, anything, a bodega, a stoop, a crack house, and just held it because it’s gonna eventually appreciate.” That early bitcoin could have been my Brooklyn bodega.
Today, as I explore and experiment in the web3-crypto space, I’m seeing a lot more Black people than I used to see in Web 1.0 and 2.0, and I think it’s because I’m not alone in feeling like I don’t want to miss the boat, technologically or financially.
For so much of U.S. history, Black people were not allowed to build wealth. In fact, we were the means by which the nation became wealthy as we provided financial leverage through our unpaid labor. Even when the period of enslavement ended, the period of exclusion continued. We had a Black Wall Street, and racists burned it down. We fought in the wars, but the G.I. Bill didn’t extend equally to us. When we finally did join the ranks of homeowners in droves it was under subprime and predatory terms that left us losing more than $100 billion in wealth after the housing market collapsed. We’ve been told to be more responsible and gain financial literacy, but the most just option would be a time machine allowing us to go back and claim the land we were chased off of and the compensation we were denied.
In parallel, Black people have a history with technology which is one of great innovation but also exploitation. In the beginning we were the literal analog technology that processed the tobacco, cotton, and sugar that fueled America’s growth. We have invented and popularized music using new recording and communications technologies from the Blues to Hip Hop but haven’t been able to retain collective ownership or fully financially benefit. In the more modern context of social media, for example, we are commonly seen as users and consumers, maybe even creators, but rarely builders or owners of the technologies and massive companies we make cool.
In our society, opportunities beget opportunities, and they compound to further concentrate opportunities. When I see a Harris Poll suggesting that 25 percent of Black people have bought non-fungible tokens, I see people playing catchup in a game that has systematically held us back. Whether it’s the “Black Bitcoin Billionaires” rooms I joined on Clubhouse or Hill Harper starting the first Black-owned digital wallet and cryptocurrency exchange or LeBron James bringing crypto and web3 education to kids, I see us trying not to miss this latest boat, and it brings me a lot of joy and a bit of worry.
About a year ago, I decided to read the Satoshi Nakamoto bitcoin whitepaper. I figured if I was going to speculate with even a small percentage of my own funds, I owed it to myself not simply to “believe” but to understand. I recommend everyone do it. It’s only 9 pages. What sticks with me to this day is that the problem bitcoin and other blockchain-based currencies and apps are trying to solve is one of trust and how we can decentralize it. Can we create a financial system which doesn’t depend on a centralized arbiter to determine the financial and transactional truth? Many people would rather trust math and machines than people because people have cheated, stolen, lied, and worse. As a descendent of people whose land and labor were stolen repeatedly, I deeply empathize with this perspective.
At the same time, I’m cautious. There’s something dangerously naive about the idea that machines are just magically more trustworthy than the people who built and coded those machines. I see the rampant grift and fraud in the crypto space, and it reminds me of the fraudulent tactics used to sell people subprime mortgages. There are so many promises of “generational wealth” being made to people who’ve been excluded from generating wealth, and many of those promises are just scams. There’s also something deeply inhumane about wanting to build a world where we quantify everything, log it on digital blockchains, and mint not just digital coins but all kinds of assets (NFT artwork, identity, and more) so that everything gets a price tag and a record in some public ledger. Is crypto a better game than the financial system we inherited, or is it just the same game with new players? Can it actually be more fair, or is transparency just a smokescreen for new modes of exploitation? If more of us participate in its growth and construction, can we create something with more collective trust and a higher degree of inclusion? Perhaps what we need to be doing is not financializing every aspect of our humanity but humanizing our financial system. That sounds good, but I don’t know yet what that looks like. Until then, I’m going to keep learning, experimenting, and pushing.
FOUR STORIES WE’RE TALKING ABOUT
An outbreak of 9-figure deals is fueling a new arms race—and serious FOMO from producers like me.
A potentially definitive, highly unscientific analysis of who has the most political juice right now in Silicon Valley.
Jeff Zucker’s resignation has upended the calculus within CNN. Here’s what I’m hearing about how it went down, and what’s next.
An exploration into the latest B.S. post-crypto fiscal fantasy of the economy’s late-stage-Covid consensual hallucination.
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