Assertion: Cryptocurrencies can enable societies to make explicit social structures that are currently implicit. This is important, because as more traditional societies melt away into the global one, we need social frameworks for people to provide “good”/“bad” meaning to their actions.

Reasoning: In the year 2018, the biggest issue we’re facing is what Vitalik Buterin calls the “nothing-at-stake” problem. In the context of Ethereum’s Proof of Stake consensus, this refers to the issue in which nodes run improper computation, either maliciously, or negligently, and there are no penalties for them doing that i.e. they have nothing at stake in case of a wrong answer. This is a meta-problem, it’s saying that an entire class of issues is caused by a single motivating factor. I’m going to argue that we’re seeing the same issue in politics, economics, and general social interaction today.

Let’s take a look at dating apps. The problem with dating apps, is that all participants are enticed to join with a false sense of entitlement. Men believe that they’re entitled to be fucked by/or have a relationship with every attractive woman on the platform. Women are entitled because they want the best possible man, to a) reach out to them, b) organize a date, c) not be a creep (i.e. not create asymmetric sexual expectations for the relationship).

It’s a shit show for women. I can only imagine, getting a near constant torrent of matches, practically for every man I’ve swiped on, so many that I have no ability to even process them, and as such wait for the men to reach out (a complete reinforcement of traditional gender roles). Messages start coming in, some of them are disturbingly forward, others might be legitimate. The legitimate ones take time. Conversations need to be had, connections formed. Because of this, I suspect women will only engage with the most optimal men messaging them. The women of the platform are not incentivized to engage with non-optimal men, because why waste time on a sub-standard guy who might just send you a picture of his penis after a couple hours of chatting? Why stake real time on a random internet person?

What does this toxic combination of expectations create? It creates a very unequal market where men constantly swipe right on women they have no interest in actually talking to. Because both parties are oversaturated (men in the input side, women on the output side) they are paralyzed: unable to communicate over chat to the people they’ve registered interest in. Both parties have nothing at stake in the success of the courtship conversation.

This is why we need social-ism.

The solution? An AI-Yenta. But that’s for another story.

Let’s take a look at United States politics. Both sides, Republicans, and Democrats increasingly only rule for their tribe because a) their tribe only consumes media that spins the tribe in a positive light, b) districts are so gerrymandered that it only matters winning an inter-party primary. As a result of this, politicians who are supposed to govern in such a way that will maximize national outcome, only govern to take care of their supporters. They have nothing at stake in the success of the country as a whole. This means that making unpopular decisions necessary for governance(e.g. raising taxes or cutting spending) aren’t ever dealt with, because politicians have no stake in the enterprise once they’ve left office.

The solution? AI-drawn voting boundaries that maximize inter-district diversity. As you may have noticed, I like using AIs for things.

Let’s take a quick look at how capitalism works right now. We’re entering this era G. Russell calls “hyperchange.” In 1958, the average tenure of a company on the S&P 500 was 61 years. In 1980, this was 25 years. In 2012, this number is now 12 years. What does this tell us? Companies are disrupting incumbents faster than we’ve ever seen before. As a result of this, investors now salivate over every bit of news associated with a company: are they growing exponentially? are they projected to lose more money tomorrow than they did today? are they capturing people’s attention for longer to serve them more ads? when is this startup going to sell itself? when are you going to ICO?

These questions are important, but I would contend they miss the wider impact of a business. One of the greatest human inventions were social structures that prevented our ancestors from shitting upstream the village. Investors are no longer thinking about the village-impact of the businesses they are investing in: does the collective mental deterioration of society via all of these ads make it more difficult for people to start businesses 25 years from now? can the burning of fossil fuels bring along an economic collapse far greater than any near-term gains? The investors have nothing at stake in the long-term health of the economy. Their goal is to get in, make money off of the next guy, and get out. Where do they go? Disneyworld with your kids if you’re a nobody, or Davos if you’re extra successful.

The solution to these problems involve creating social structures that cause decision makers to stake something of value on the decisions they make. Nassim Talib refers to this as “putting skin in the game.” If they’re successful they rise, if they aren’t they fall. Anybody should be able to stake on anything, but whatever you stake with can’t be infinite, otherwise there is no point. We need to be staking on what we care about, and building our social identity around successful stakes.

Staking doesn’t magically stop the process of people being dumb. If Van Gogh lived in a staking society, he would have still been a nobody because society didn’t appreciate his art. The tail can’t wag the dog, but what it can do is make the dog more aware of itself.

Humans thrive in a lattice of social structures.

Let’s imagine FlakeToken. You start with 10 FlakeTokens. Whenever you commit to going to an event or put your table on hold at a restaurant, you stake 1 token: if you show up, you get back 2 tokens. If you don’t show up, you lose your one token. No exceptions. Here is the thing: nobody actually cares about excuses, you either commit a token and show up, or you lose it. If you go down to 0 tokens, you’re publicly humiliated for being a flake. To get more tokens, someone has to give you some of theirs. It’s opt-in, not opt-out. If FlakeTokens were attached to a dating profile, I’d want to maximize them. It’s something that matters to me, and I care about it just as much as I do about someone’s pictures. But that’s my opinion. I attach value to FlakeToken, you don’t have to. Just like you might not care how many IG followers somebody has, or how many Medium claps they have, how long their Snap streak is, or how much Dogecoin they’ve invested in.