Tag Archives: Bitcoin vs. Dogecoin Narrative

Schisms Appear in Cryptocurrency Narratives

The Bitcoin community is getting another lesson in the importance of end-to-end thinking in systems.

As MtGox officially enters bankruptcy, with the usual real world consequences of lawsuits and loss of confidence, yet another exchange has problems. Cryptsy.com apparently had mysterious problems which delay payouts (i.e., you can’t convert your BC into worthless, immoral, old “fiat” currency).

The wobbly exchanges have nothing to do with the validity or security of the exchange protocol, or the mining systems. Hence, some consider them relatively minor issues, not relevant to the “real” cryptocurrency systems.

But faulty and slow exchanges have knock on effects. For example, Jonathan Saewitz reports how a mining pool, cleverly named “BlackCoinPool”, which can’t operate without exchanges. While Saewitz headlines this as a problem with cryptsy (the exchange), it is actually a problem with Bitcoin and cryptocurrency in general.

The end-to-end principle is simply this: the whole system has to work, end to end. The chain is only as strong as the weakest link.

These practical and reputational problems with cryptocurrency exchanges are contributing to the ongoing bifurcation of the Bitcoin narrative. (What religion worth its salt doesn’t have a schism?)

We are seeing the “suit-ification” of Bitcoin. All sorts of grown ups, vice principals, and wall street sharks are getting in the game. And they aren’t interested in the “rugged beauty” of offshore freebooters, they are interested in controlling the financial system for their own profit.

For example, Pete Rizzo reports on the announcement of yet another grown-up exchange, which is to be organized a lot like a conventional financial institution. Notably, it is clear that this project is a direct response to the catastrophic failures of the amateur exchanges.

I predict we will see increasing religious warfare between the utopian libertarians, who love the “rugged beauty” of completely offshore money, and the suits who want to make money off the conventional, regulated economy. Of course, the technology doesn’t care, you can do it either or both ways. But the Bitcoin brand will soon see a major crisis, due to conflicting narratives.

Meanwhile the Dogecoin narrative faces its own schism. Following the path of the sponsorship of NASCAR #99, Shibes are sponsoring a Mixed Martial Arts fighter. This stuff is pretty far from the utopian Robin-Hoodiness of many Shibes (e.g., this or this).

It will be interesting to observe the upcoming “Dogecon” in San Francisco (April 25, 2014). The program includes formal pitches and probably a lot of goofing around (a costume contest is advertised).

As Peter Spence astutely notes,

It’s not clear that Dogecoin’s own userbase is keen for the currency to become a replacement for traditional money, or for it to be used as much else than a means of rewarding others on the internet for producing or sharing content.

We shall see if there is a “suit-ification” of Dogecoin, or at least a NASCAR-ification.

On the Mazacoin front, there was never doubt that the nationalist narrative would encounter pushback, likely from many directions. I don’t mean to get involved in the internal affairs of the Lakota, I only want to comment on the public narratives about the cryptocurrency. These narratives will, no doubt, reflect many aspects of Lakota history, politics and culture, which I respect but do not have a personal stake in.

A spate of publicity has put forward an initial story for Mazacoin: it could be “the new buffalo”—definitely a trenchant cultural claim.

Alysa Landry reports with an interview which recounts the founding narrative quite clearly. “Developing currency is a way for tribes to maintain sovereignty”, and maybe to “alleviate poverty by propelling the Lakota Nation into the global market”.  (Initial venues will likely be casinos and pow wows.)

However, Brandon Ecoffey reports that the Tribal Council and President are unaware of this “official currency”, though they have endorsed the exploration of the topic. The Council and President are the embodiment of the tribe’s sovereignty, so they will have to be on board.

To date, it is not clear how this will play out, but there is clearly a possibility of multiple narratives developing around the cryptocurrency technology.  One council member is quoted to skeptically remark, “It looks kind of like a scheme to me”.

Got schism?  Everybody’s doing it.

Cryptocurrency Narratives: Flame, Fraud, and “Airdrops”

Cryptocurrencies are in the news in all sorts of ways, publicly acting out a diverse set of stories, all enabled by the same technology.  Bitcoin is suffering serious reputation damage, and the Dogecoin versus Bitcoin narrative burns on, achieving high school levels of intellectual rigor.

Plenty of other action, including blatant pump and dump schemes that seem to always work long enough to make some money.

I didn’t anticipate, but it is obvious in retrospect, the great interest in “national” cryptocurrencies, and apparently, even more localized community cryptocurrencies (e.g., HullCoin).

We see the trend continuing with a new Isracoin.  Like other national cryptocurrencies (e.g, MazaCoin or Auroracoin), the nationalist claim is made by “airdropping” an initial ration of currency into the nation in question.

(The cryptocurrency community is coining nearly as many new words as ducats.  “Mining”. “Airdrop”.  Dogecoin’s “such pseudo-grammar”.)

So, the currency is mined as in other cryptocurrencies, but the first crop is (supposed to be) given to the people of the nation.  Others may then mine additional coins independently.

In the case of MazaCoin, one crop goes to the tribal government, and another crop to an investment pool to disburse to Lakota people and businesses.  It is not difficult to understand why Lakota people would want to control their own economic development.

In the case of Auroracoin, the “national” cryptocurrency of Iceland, the airdrop was apparently 31.8 AC per citizen, whatever that might be worth. Auroracoin is undoubtably motivated by the austerity measures following the deep crash created by, well, by unregulated financial dealings.

Isracoin promises an airdrop to Israeli business and citizens in June.  The manifesto has a populist theme, complaining about concentration of wealth and centralization of banking (attributed in part to botched privatization). The manifesto isn’t terribly clear how a cryptocurrency will change these facts.

More cases will surely follow.  Spaincoin.  Maybe an independent Scotland will have a cryptocurrency. And so on. Anyone and everyone can do it.

These narratives are quite interesting.  They remind me of the “Free Silver” movement in the nineteenth century US, but also the competing Gold Bugs.  It combines the Gold Bug concern for “debasement” and manipulation, with the Free Silverists desire for more equitable distribution and looser access to capital.

The contemporary ones employ rhetoric from the remnants of older left- and right-wing populist movements, with both anti-government and anti-elite arguments.

In contrast to the original Bitcoin narrative, which is directly out of libertarian ideology, these populist/nationalist narratives attempt to distribute wealth throughout their identified community, hoping to boot up economic growth. Where Bitcoin has been transnational, indeed post-national, from day one, these cryptocurrencies dream of growing their nation/tribe/city.

Obviously, the absurdist Dogecoin narrative contrasts to both of these, especially eschewing serious purpose other than charity.

The Icelandic experiment is farther along than the other national coins, so we can look at it to see how such plays might unfold.  First, we have to note that, unfortunately, the actual national government of Iceland has strict controls on currency movement (imposed as a result of the disaster created by earlier unfettered wheeling-dealing). This means that AC can’t legally be traded internationally, as some had initially hoped. (Cryptocurrencies are ideal for capital flight and money laundering, so they will surely be met with hostility in many jurisdictions.)

Worse, the airdrop itself has been plagued with reports of theft and fraud. The difference between and airdrop and a Ponzi scheme is…well the only difference is the statistical distribution of who gets the money.  Each of these “nationalist” airdrops are a bit opaque, so we really don’t know in advance how legit they are, and who may benefit.

Then there is the issue of identity fraud (and possible theft), and other forms of hacking.  Cryptocurrencies are extremely vulnerable to theft, and difficult to defend.  (Not unlike metal bullion.)

In the case of Auroracoin, some guy on the web is supposedly giving out free money, all I have to do is give them my ID number. What could possibly be wrong with that?

Much to think about here.  More later.

Cryptocurrencies: A “Better Parties” Metric?

As for cryptocurrency cultural narratives, I think we might apply the classic, “who has better parties” metric.  Obviously, party preference has a highly subjective component. Nevertheless, we can look at public meetings to glimpse from the performances of the participants some notion of what they think is “fun” and “important”.

This is one area where it is really easy to see differences in the communities acting out different cryptocurrency narratives.

All cryptocurrencies come out of virtual “communities’, which use the same technologies.  Nowadays, there is actually a meta-community of all the competing cryptocurrencies (Bob McGrath, important citizen of this world).

But what about face to face?

Here there are contrasts that no amount of subjectivity can disguise.

BitCoin has meetings with regulators and cops (unfortunately for them), as well as Silicon Valley pep rallies featuring superstar billionaires. Lots of suits.

DogeCoin has meetups with dogs, DJs, comic books, and, well, beer.  NYC, Brisbane, LA. I’m not seeing suits.

I’m almost ready to do one in my home town, just to show we can.

I note that other currencies may yet give us interesting “parties”. Surely MazaCoin will generate interesting get togethers if it succeeds.  Extreme local cryptocurrencies (e.g., HullCoin) potentially could lead to interesting “block parties”.

We shall see.

Cawley Documents Foundations of Dogecoin Narrative

So, in contrast to the anxious psychodrama evident in recent public rants by BitCoinistas (e.g, here and here), we have totally different narratives acted out by Shibes.

Daniel Cawrey at coindesc.com posted an interview the big Doge Jackson Palmer, mostly about the origin and culture of DogeCoin.

Here we have the core of the narrative laid out for us: Palmer remarks on how unfriendly the “crypto community” can be, “you get shouted at. And it’s not the right way to go about it.”

He also uses words like “negativity” and “angst”  in the bitcoin community (you think!?).

The point of DogeCoin is ”People were being friendly to one another.”

Like any good religion, DogeCoin has a memorable origin myth.  Where BitCoin’s origin is traced to a pompous pseudo-academic paper [PDF], DogeCoin is said to have originated in a joke in a tweet (“Investing in Dogecoin, pretty sure it’s the next big thing.”)–which inspired a few people to make the joke real.

Cawley claims that “Dogecoin has hit demographics that other coins haven’t been able to touch. That includes women, high schoolers and anyone who loves the idea of memes.”  I’m not sure what the evidence is for this claim, though obviously my attention has been captured by the meme-based technology.

Jackson argues that not just any meme would work. He believes that the Doge meme is “a pure meme”, and cites Adrian Chen’s assertion that “Doge has a sort of innocence that cannot be tarnished.”

Wow!  Such meme!

No wonder the BitCoinistas are foaming.  How dare they sully the “rugged beauty” of BitCoin with “an innocence that cannot be tarnished.”




Popescu Gives High Class Narrative of “Why Dogecoin is a scam”

The BitCoinistas are getting a bit anxious, what with their one-true-ring not ruling them all quite as much as hoped.

I already remarked on Marc Andreessen’s class act last week.

This week there is buzz about a childish rant from “Mircea Popescu”, partly titled “Why Dogecoin is a scam“.

I haven’t got the time or energy to deal with all the nonsense here, but that isn’t really important.

This is a beautifully revealing exposition, that brings out many of the underlying themes of the Bitcoin narrative. And his statements about Dogecoin shed light on the cultural meaning enacted in the Dogecoin narrative.

It’s obvious that Dogecoin threatens the very core of MP’s strongly held moral beliefs about cryptocurrency, which was also clear in Andreessen’s rant.  The personal attacks on opponents is a dead giveaway that something more than technology is at stake:  these zealots have a lot of personal ego tied up in the Bitcoin narrative.

The article itself is a gold mine (oops!  Perhaps I should say, “BitCoin mine”) of rhetoric, heavily laden with cultural and political baggage.

We are told that, by definition, Dogecoin is a scam because it has taken slightly different engineering choices. It is also asserted that, by aiming for goals other than currency speculation, Dogecoin is morally corrupt and criminal.  Oh, and it operates like (the hated enemy), “fiat” currency.  (Interestingly, our everyday life experience with money is said to be sustained by “exercises in cognitive dissonance that are used to misrepresent the fiat regime as “normal””.  Apparently, real life doesn’t conform to ideological “normality” here.)

The creators of Dogecoin, who, in this post, appear to be a large number of anonymous conspirators.  They are “the sort that have never done anything useful in their lives so far and will not be doing anything useful ever.”  Interestingly, this moocher class apparently includes “Marketeers, “creators” of pointless web 2.0 crud, tradeshow freaks, braindamaged pseudo-entrepreneurs working in VC entertainment. The scum of this Earth.”

Some of the charges of “scam” are a bit weakened by the fact that no one is making money off Dogecoin–that’s one of the great heresies.

It is clear that a big problem with Dogecoin is that “those people” like it.  We are treated to vicious smears, basically indicating that all those blood sucking “takers” favor Dogecoin.  Dogecoin users are “idiots” and “retarded”; they are “silly kid[s] so deprived of human contact”, “halfwit[s] spending his hard-earned government dole to be “part of something””, “everyone with something to give”.  “[T]he kids, the unemployed, the unemployable”.

Those people.

(IMO, it’s not a brilliant rhetorical strategy to slash at “everyone with something to give”.  Next, you’ll be blasting the deep immorality of cute pictures of puppies. Oh, wait.  Dogecoin is based on the “pictures of cute doggies” standard.  Uh oh.)

In contrast, Bitcoinistas “are in crypto for crypto”, and understand the true “rugged beauty” of BC (to quote another enthusiast). Bitcoin isn’t deflationary, which isn’t a problem anyway, because I said so. Anyone who says otherwise, “They’re that stupid, these people.”


You don’t need me to connect this rhetoric to the Ran Paul/Paul Ryan strain of libertarian politics.  The references to “those people” make that very clear.

But why all this flame directed at Dogecoin specifically?  Clearly, Dogecoin has gained popular recognition, nearly as great as Bitcoin.  The son is rivaling the father, which is a tense situation. (I might say “the daughter is rivallng the mother”, but this is an all male affair, as far as I can see.  Which reminds me:  isn’t it time for “FemCoin”?)

Dogecoin’s narrative is deliberately designed to mock and undermine aspects of Bitcoin’s narrative. Judging by the vehement and irrational responses, there are enthusiasts who have considerable personal commitment to these narratives, and are therefore threatened by alternative narratives.

If Dogecoin can succeed despite not being serious, and by taking alternative design choices from Bitcoin, then neither Bitcoin’s technology nor its narrative are self-evidently “right” (nor inevitably successful).

For those true believers (and MP obviously is a very true believer), the “success” of Dogecoin is deeply wrong and even immoral.

This psychological dynamic probably drives some of the Dogecoin narrative.  From the start, Dogecoin was deliberately a story about being “not Bitcoin”. The design decisions (e.g., to not have a cap, and to welcome regulation) were made for very good ideological reasons, which is why they are so “idiotic” for Bitcoinistas:  Dogecoin dared to choose “wrong”, and, astonishingly, the heavens didn’t fall.  This cannot stand.

Wow!  Such religion.




Mazacoin: Yet Another Cryptocurrency Narrative

I have commented on some of the every-more-numerous cryptocurrencies, noting that the exactly same technology has led to multiple cultural narrative. I compared the “Bitcoin” narrative with the “Dogecoin” narrative, including a minor semantic analysis.

Now I have encountered yet another interesting narrative, built on this technology:  “Mazacoin”.

Mazacoin is declared to be the “First Sovereign National Crypto-Coin In History”, and to be specifically designed to “incorporate MazaCoin into the economic apparatus of the Traditional Lakota Nation.”

One link to the Lakota Nation is a pre-mining phase, which will mint a $25M coin “national reserve”, and a second pre-mining phase, which will mint a $25M coin investment fund to be distributed to Lakota individuals and businesses.  After that, anyone will be allowed to mine additional coins.  (This looks just like “fiat” currency to me, but so what?)

In addition to the nationalist theme, the narrative emphasizes that the cryptocurrency is ecologically benign compared to metal mining, conventional currency production, and even other cryptocurrencies.  I have not yet examined these claims in detail, but it is good to see this addressed.

The Mazacoin folks have most of the end-to-end system in hand, including their own dedicated exchange (“BTC Oyate Initiative”).  The narrative includes advocacy for offline and face-to-face trading schemes, which appeal to traditional values of this community.

This is pretty cool.  Compared to the Bitcoin Narrative, Mazacoin is grounded in a particular community and moral tradition.  Far from the “anything goes” ethic of Bitcoin, Mazacoin clearly states a serious purpose and intends to benefit the Lakota people above all.

Like the Dogecoin Narrative, the Mazacoin story is about community and humanity.  Of course, Dogecoin is deliberately not serious, while Mazacoin is very, very serious about Lakota values and community. Conversely, Dogecoin works despite having no serious purpose, while Mazacoin will stand or fall on meeting its higher purposes.

Obviously, I should add Mazacoin to my semantic analyses of “*coin” narratives.

The development team promises to develop unspecified “new and innovative ways to further incorporate MazaCoin into the economic apparatus of the Traditional Lakota Nation.”  This is something I would be very  interested to learn about and/or assist with (though I am not Lakota, I am pro-Lakota).

So I will be watching Mazacoin closely, and may well use it as another case in my studies of the cultural narratives surrounding cryptocurrencies.