Bitcoin. Blockchain. DLT. ‘Distributed concurrence’.

Despite the increasingly deep divisions among vested interests in whatever it is we’re calling what CoinDesk covers these days, there emerged one uniting theme for the summer of 2016 – to those most engaged, it was at best a prolonged existential crisis, an Olympics of intellectual gymnastics that, like this year’s games, sometimes seemed to be struggling too hard to maintain its own relevancy.

A quick recap reveals a running gag reel. The first leaderless company raised $150m, then promptly imploded; a popular blockchain network suddenly and spasmodically split in two; and a major exchange got hacked, spread the losses among investors and somehow managed (thus far) to avoid any lawsuits or regulatory action.

And that was just in the public blockchain part of the ecosystem.

Events were somehow just as confounding in the private blockchain space. There, major players seemed locked in an increasingly mundane arms race to enlist companies in granular R&D projects, none of which were too small to stem the barrage of press releases.

All this occurred even while the professionals working closest with private versions of the technology swore it off as a failed experiment, the startups that were the biggest champions of DLT experienced pervasive staff cuts and banks saw their senior members start what will likely continue to be a revolving door between the sectors.

Navigating this series of developments seemed sometimes like walking through an elaborate maze of funhouse mirrors or reading the latest installment of Harry Potter. Somehow the characters were familiar, even if the random plot deviations sometimes threatened to undermine the entire series.

What’s left for those still observing the industry is harder to determine.

Will blockchain recede like virtual reality in the 1990s? A technology over-hyped and still decades away from mainstream? Or is the Internet ‘weird again‘?

While the answer to these questions is beyond the scope of this piece, its remainder will constitute one observer’s attempt to sort through the wreckage, adding one last comment to a summer that provided a constant stream of things stranger than “Stranger Things“.

Tale of two chains

Perhaps the first perplexing event of the summer occurred with the sudden and dramatic split of what was then the best-performing blockchain project.

For a time, it seemed like nothing could stop ethereum. The decentralized application development platform was increasingly capturing the imaginations and interests of institutions, developers, startups, speculators and the press (See TechCrunch’s “All the cool kids are doing ethereum now”).

It was perhaps to be expected that this praise, and the expectations it created, would prove to be a two-sided sword.

As detailed in CoinDesk’s “Understanding Ethereum” report, the vision for the platform continues to operate in sharp contrast to a reality that will find its community needing to succeed on a number of difficult technical feats. Some in its leadership acknowledge this, though decentralization all but ensures this modesty is not contagious.

Challenges, in hindsight, were to be expected; perhaps, better prepared for, but mostly expected. Today, there are two, almost identical versions of the ethereum software, with two almost identical versions of the blockchain’s history. One is bigger, one is smaller.

It was sudden, unexpected, dramatic, controversial. Maybe even innovative.

Perhaps what was most apparent in the aftermath, however, was how polarized an industry based on supposedly uncharted science had become, as the event was quickly refracted to support the positions of any community that voiced an opinion.

To ethereum, the hard fork was a sign of the strength of its leadership, its ability to charge forward and adapt; to bitcoin believers (struggling with their own decision-making and gridlock), it affirmed that conservatism is the best defense against the unknowns of the technology; to institutions and regulators, it was a sign that [insert preferred noun] was still a Wild West.

In short, everyone said what was expected of them, scarcely more.

Certainly, there was good dialogue. Josh Stark published a deep retrospective on the nature of community values in defining digital currency values; Cato’s Jim Harper opined on the folly of defining the issue as one of governance.

Was it good? Was it bad? The often unspoken answer was simply that it arguably remains too early to tell.

The fact that few members of the community seemed to use it as a platform for considering tough issues, at least publicly, may have been the greatest loss.

A referendum on altruism

That’s not to say there weren’t substantial learnings from the split of the ethereum community, but that many were buried in a confusing array of public behavior.

Shortly thereafter, those ideologically opposed to ethereum saw it as an opportunity to attack a project that had stolen the spotlight. Reviving the aborted blockchain (dubbed ethereum classic) emerged a way for some community members to profit from what was objectively the sudden creation of millions of dollars out of thin air, sometimes monetarily, sometimes by raising their own industry profiles.

What followed was difficult to watch from the perspective of a sympathizer, one who believes ethereum’s vision is a compelling addition to the cannon of blockchain explorations, and that the idea of extending Satoshi’s original vision to one that could perhaps pushes its disruption beyond finance is one that, from the perspective of innovation, deserves to be asked, tried, and ultimately, to fail if that is its fate.

In hindsight what may be most surprising is that the rampant speculation that followed was perhaps a defensible or even laudable exercise, a way of ensuring that any possible point of attack for a public blockchain was explored to the extreme for greater understanding.

Perhaps the best way to look at ethereum classic is as the most nuanced test of bitcoin’s economic model, and the unflinching resilience (or obstinance) with which its developers stress the importance of weighing any and all possible risks to a major decision.

It didn’t and shouldn’t have mattered the reason for the actions, nor should it have been assumed that the market should simply “behave” or “follow consensus”. It did anything but.

Could ethereum classic emerge as the main blockchain? Would both co-exist? It matters, maybe not as much as we think, maybe more.

All estimations seem to break down from the perspective of uncertainty.

The takeaway may be that people will always behave in the way that best benefits them, and that bitcoin’s insight into this aspect of human nature may be one of its defining design elements, one worthy of greater understanding, and perhaps, greater emulation.

In search of a ‘digital asset’

That wasn’t to say that events in bitcoin didn’t offer cause for pause.

The large-scale investor loss at Bitfinex proved one of the most baffling, as the event saw one of its most trafficked exchanges, and one of its most lauded security companies, come to grips with just how little is understood about how to secure cryptographic assets well.

The Bitfinex hack served to underscore the real pain that “innovations in the blockchain space” can bring to those who seek to participate. Certainly investors bear risk when engaging with new platforms, but so, too, must this risk be treated with respect.

Perplexingly, the hack of Bitfinex, somehow coincided with the growing confidence that alternatives to bitcoin, technologies subject to less testing, less scrutiny and with more dubious value propositions, should perhaps be made easier to access.

With a blog post series from Union Square Ventures and others that would follow, the age of “institutional altcoins” was declared.

Alternative digital currencies, once regarded as a distraction to bitcoin’s network effect, were now re-cast as a feature, not a flaw.

The about-face, while intellectually valid, proved a tough pill to swallow given the long-standing discrediting campaign waged by many of the parties who were quick to adopt it, and the immediate way their businesses benefit simply by deciding that a new market somehow meets their definition of “innovation”.

While “digital asset” is perhaps a more friendly term for altcoins, it remains unclear which digital currencies fit this definition. In its rebranding as a “digital asset” exchange, Coinbase’s GDAX, for example, added support for litecoin, a digital currency project that has often been critiqued for its lack of innovation or apparent use.

The decision underscored that it remains unclear what a “digital asset” is, and how strange it is to define the networks that support them – many of which have no provable use beyond speculation – as protocols. Sure, there are fumblings in the dark – Zcash, which strives for true blockchain privacy and Steemit, which aims to incentivize content monetization.

All of these projects seemed open to being lauded or vilified, the lingering economic incentives for those evaluations perhaps emerging as the least understood aspect of the experiment.

It begs the question, how can one really strive toward innovation when you’re heavily invested in a certain network or asset maturing? Technology and money, it seems, remain two contrasting flavors in search of some culinary solution.

The rise of ‘Bitcoin Uncensored’

Amidst this backdrop, it takes a rare skill to polarize, and in the ‘Summer of Stupid’, there was perhaps no greater divider than ‘Bitcoin Uncensored’ – a sprawling, loosely defined ‘podcast’ that spilled across social media and permeated conversation through the sheer charisma of its creators.

To preface, the inclusion of ‘Bitcoin Uncensored’ on this list is likely to draw some criticism, and there are doubtless those who will think it irresponsible to bring attention to the content produced by Florida-based co-hosts Chris DeRose and Joshua Unseth or to even define their creations as content at all.

Certainly, it should be prefaced that the intent of this is not to laud or condemn all of the show’s content or its actions. At worst, the show pandered to baser instincts, with its humor often relying on the use of homophobia, race and sex, and the humiliation of the (sometimes unwitting) interview subjects who served as fodder for their ascendence.

Yet, at its best, it could be argued ‘Bitcoin Uncensored’ transcended to the highs of successful ‘shock art’, fulfilling the definition by taking aim at the “smug, complacent and hypocritical” in an effort to give a voice to those who had otherwise be rendered silent.

In an industry that was increasingly keen to put established brands on a pedestal and disregard both the achievements of its developer and investor ecosystem and the merits of their original goals, ‘Bitcoin Uncensored’ arguably served as a pipe bomb that leveled the playing field, reminding those who listened of the pitfalls of accepting not only easy answers, but the absurdity that individuals in such a nascent space can somehow be placed above scrutiny by some special knowledge or achievement.

Through it all, there were transcendent moments that were challenging, thought-provoking, and perhaps most surprising given the esoteric subject matter, vital. A convicted Ponzi schemer was given a humanizing moment. An organization whose product may be putting consumers in jeopardy was questioned forcefully, maybe even ineffectively and awkwardly.

How this will play out in the future remains unclear.

Certainly, the careers of other controversial creators in music (Odd Future, Eminem) hint at the challenges inherent in continuing this approach. However, they also show how the outsized reaction of those who seek to silence their expressions are often undermined by the extent to which they go to seek condemnation.

Whether this question even matters is a more complicated. “Extraordinary claims require extraordinary proof” emerged as the mantra and defining ethos of the show.

Indeed, the claim that two often offensive, sometimes not-so-merry pranksters could emerge as impactful and important remains an extraordinary claim.

Here’s to hoping that they continue to provide more evidence.

The database saviors

Yet even as the painful struggles in the public blockchain ecosystem continued on, it remained difficult not to see it as a weirdly heroic if ill-advised use of energy.

Much like Don Quixote charging majestically at windmills, there remains a strange heroism in the idealism that permeates the public blockchain sector. If The DAO failed, if Bitfinex needed to take liberties with investor rights, it was perhaps for the sake of something greater, a more equitable financial system (maybe).

At Consensus 2016, Wall Street Journal writer Paul Vigna famously asked R3CEV CEO David Rutter, “So, what are you doing for humanity?”

And the question remains one reinforced by the events of this summer, as the press continued to portray the quest by big financial institutions to cut costs and ultimately trim employees from their payroll as some valiant cause.

In some respects, it was almost laudable the extent to which private blockchain research sought to contort the technology to fit its own aims. In the midst, however, there was recognition, that seeking to redefine the blockchain for business will take its own innovations.

Going forward, we have to hope, however, that there will be more than friendly photo opportunities, less overly dramatic in-fighting.

What should take their place is perhaps less certain.

Indeed, perhaps the summer’s biggest lesson may be one on the nature of failure, of public blockchains that were too quick to court it, and private projects that all too often eschewed it.

What was sometimes lost was that all of this should mean something to those extending beyond the immediate vested parties, all of whom it should be noted are invested in one way or another (even this author), whether by direct investment or through their reputation and careers.

Certainly, failure is not above praise or scrutiny. It seems a greater failure is not judging it by the value of its intent.

Gaga.

Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Coinbase.

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