How would Marx view cryptocurrencies?

Written by: Ben Munster

Compilation: TechFlow Intern

Some Internet left groups who are extremely curious about Crypto have been lingering on Crypto Twitter: If the old man Marx was alive, would he approve of this blockchain technology?

Last year, left-wing cultural writer Hussein Kesvani argued in an article titled “The Left Should Talk About Crypto” that Web3 and the Ethereum ecosystem’s Crypto, for better or worse, would “inevitably” change the world.

Therefore, he argues that the left should retake the technology from liberals and anarchist capitalists, who borrow terms and concepts from socialism. These pirates include Li Jin, who has relative clout in the Crypto space, despite being a venture capitalist by profession, he claims to be a student of Marx and tweeted last year that the DAO is “the next step in the labor movement.” direction.”

As you can imagine, the Left loathes this sort of thing. In Kesvani’s article, he called on the left to grasp the fundamentals of cryptocurrencies in order to make a more convincing case than venture capital firms. Kesvani wrote. “I believe that imagining a different future requires some understanding of Crypto and blockchain technology, not only for functional reasons, but also for examining the language and mandate of the new internet.”

Since Web3 has attracted a lot of mainstream attention, and all of the above has happened, there has been some disagreement on the left side, the old-school, strictly anti-capitalist left to be exact, about the suitability of Crypto as a technology. . Many old-school thinkers who have only recently learned about Web3 see it as an eventual form of financialization of all things, albeit veiled in the context of mutual aid and equality, it is still an expression of the rent-seeking class that it does The oxygen molecule has a clear price tag. The other faction, however, takes a more moderate view, taking into account real-world issues like scams and greed, while still holding out a degree of hope for things like DAOs.

Within Ethereum and its adjoining communities, there is also a debate about whether the ideology they subscribe to belongs to the invisible left. Although ethereum followers are much more left-leaning than libertarian bitcoiners in spirit, and have published countless articles about good governance and fair distribution of wealth, they are not always happy to associate themselves with ” Socialism” on a par, nor is it strictly tied to the classical left.

Crypto is nothing but nonsense

Negative stories about it can be found in the Marxist turf Jacobin Magazine, which previously tried its best to ignore Web3 (I’m too lazy to use “cryptocurrency” interchangeably), and has since viewed the industry as something irritating and something to fight back against. In the past few months, it has been particularly focused on breaking down rhetoric about the “democratization of wealth” in cryptocurrencies, with one article arguing that “utopian rhetoric around freedom, decentralization, and the economy of ownership may help investors at night. Sleep well, but at its core, it’s just a way to market a new generation of products to the public.”

Likewise, another recent article bemoaned the proliferation of “Crypto” in the football world, especially those “fan tokens” that claim to give fans a “voice” but are really just putting stickers and “victory tokens” “Song” and other tasteless stuff to monetize.

Another article refuted the claim that NFTs could benefit creators, citing the glut of funds created by hyping NFTs as a departure from the opportunity to better distribute wealth post-pandemic. The article reads: “Very simple, NFTs are shit.”

On the surface, it makes sense that the Left instinctively hates Crypto in all its forms. What is blockchain technology as a mechanism, they ask, other than extending the harmful tentacles of mass capitalism to the realized and unrealized layers of modern life? What Marx objected first and foremost was the misallocation of capital by capitalism and the unscrupulous use of any means to obtain profit – what better way to fuel the greed of the bourgeoisie than Dogecoin? They would also add that the “user ownership” embodied by things like Ethereum mining is illusory. Instead of the levers of industry, the workers have strings of numbers and JPEGs.

To add, half of it is funded by venture capital firms.

David Broder, editor of Jacobin magazine, told me: “It’s very false and unhealthy in my opinion, and I don’t seem to see any social use for it.”

This backlash has been echoed in general, most notably by a YouTube video about NFTs posted last month that was well researched, 2 hours long, and produced by the Folding Ideas channel. There are also numerous criticisms among the center-left, who are dismissively called “the mediocre moderate centrist” by the left. These critics largely ignore the social issues inherent in the design of Web3 and focus on minimal environmental criticisms, such as trading an NFT that consumes the same amount of electricity as Norway/Peru/Turkmenistan, and some downright plausible conspiracies s. I don’t know, maybe the Boring Ape is really Nazi propaganda.

the future belongs to you

Outside the left, however, at least some aspects of the technology have been embraced, albeit generally at a cautious distance to circumvent its many shortcomings.

Some argue that the technology, with its anti-authority potential, distrusting big banks and focusing on democratic ownership of online platforms, does have kinship with the left, if not entirely trustworthy.

For example, both left-wing tech writers Ali Breland and Max Read have noted that in a modern economy with severe inequality, investing in Crypto is as practicable as any money-making strategy; Ridiculous money is made out of thin air, why shouldn’t anyone else be involved in this scam? But this is less an argument in favor of cryptocurrencies than a tactical compromise.

Does anyone on the left really like cryptocurrencies?

The most promising leftist rhetoric to justify Crypto has revolved around the DAO, a decentralized autonomous organization. DAOs can be roughly understood as ordinary businesses that certain Crypto holders can enter – they also get a vote on a business – and the left (and some of the VC groups we’ve seen) have been talking about their Capability, also known as liberating laborers as you usually know them.

Even Jacobin Magazine called the DAO “interesting,” but also warned. Among many left-leaning DAO advocates, Austin Robey has been heavily involved in the movement around platform cooperatives, where users own Crypto services, and in a recent article argued that the DAO token model could be a usable tool for these cooperatives seeking efficiency and scale . He added that DAOs can likewise learn from traditional cooperatives how to avoid their common pitfalls, such as the unequal distribution of token wealth (and voting power), the formalization of self-serving “communities”, and the rapid deterioration into a show that attracts investment etc.

Robey is not surprised to see other leftists attacking Crypto on environmental and social grounds, and he often shares some of them. “If you’re interested in cooperatives, I can’t imagine you’re not interested in DAOs,” he said. “We need good, hopeful people to try to reinvent and reimagine these technologies for better purposes, not just Tools are handed over to people we don’t recognize.”

Robey cited controversial NFTs as another example. “I see a lot of people struggling with NFTs, for example, by conflating them with the art of cryptography on specific networks.” Robey added: “They don’t realize that NFTs are like a general computing primitive. They are not necessarily made by Ugly art made by people people hate; they can represent a platformless membership that frees you from the corporate tech monopoly.”

He added that cryptocurrencies are not necessarily “about financial speculation, treating everything as a stock market. I want to capture its social value.”

Interestingly, MolochDAO, the original version of many DAOs today, can also be said to be the beginning of the DAO revival, and its inventor, Ameen Soleimani, happens to be a staunch anti-socialist. I asked him this question recently and he got a little excited. Socialism is autocratic, the state is the monopoly of violence, it hinders freedom, and it is “impossible” to put it into practice without coercion.

For Soleimani, the DAO is more of an ideology-agnostic, post-capitalist coordination tool. “It’s bigger than capitalism, the product of the DAO is a bit politically neutral, it’s a coordinated maximization,” he said in an interview. “We don’t care what political ideology you want to pursue. We care. It’s about how effectively humans work together.”

To illustrate this point, Soleimani cites the origins of the cyberpunk movement, saying that the cyberpunk movement began when cryptographers handed military-grade encryption to individuals so they could “communicate with each other without the risk of being spied on” “. It’s a pure liberal philosophy, both anti-capitalist and capitalist.

But whether you like it or not, most of what Soleimani agrees with is exactly the same as socialism, albeit a lesser-known branch: liberal socialism, i.e. replacing top-down corporations and you’ll have millions and a half Competitive employee-owned cooperatives. This cannot be said to be exactly the same as DAO, it can only be said to be exactly the same!

The DAO-as-co-op argument might sound familiar because that’s exactly what Lee Jin is making, and it’s somewhat odd to see people on the left come to the same conclusions as VCs. This is why some dismiss the technology (and the accompanying philosophy of user-worker liberation) as a fraudulent appropriation outright. That’s why last year I tweeted a pretentious response to an optimistic leftist: “DAOs that actually perform the collective investment function are not so much socialism as mass capitalism on steroids, in which every Individuals are shareholders.”

Not long after, however, I got a response from a guy named Mat Dryhurst, co-host of the left-leaning tech podcast Interdependence, and one of the more radical thinkers on the liberating potential of blockchain.

Dryhurst disagrees with my suggestion that DAOs, and with them Crypto, are entirely capitalist tools, and makes an interesting argument. “I think the most interesting and promising thing about Crypto is that there are new demands and unintuitive alliances that are being built,” he said. “It may not be perfect, but what it offers is an idealized, democratically agreed-to ownership. VCs, not the wonderful leftist demands that didn’t make it possible.”

What a great idea! In a way, Dryhurst is articulating the idea of ​​classical socialism that the technological foundation laid by capitalism will underpin the future of workers. And if cryptocurrencies make it profitable to build something left-oriented, like cooperatives, then venture capitalists like Li Jin will unknowingly be on the side of the class struggle.

As in Marx’s analogy, the capitalist will sell you the rope to hang him – but in this case, the capitalist is the VC firm Andreessen Horowitz, selling you a speculative DAO token.

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