In my quest to get inspiration from non-Bitcoin thinkers in the business world, I recently read The Tipping Point by Malcolm Gladwell. My goal is to see what ideas I may be overlooking as a Bitcoin-focused entrepreneur, writer, and accidental influencer. The book is a fascinating exploration of how ideas, products, and social behaviors spread like epidemics. While I love Gladwell’s writing style, the book seemed almost painfully obvious in the points it was making, but it might be because his book worked as a template for formatting digital virality in the information age, and I am, myself, a product of the world created by this seminal work from about twenty years ago.
Gladwell identifies three key factors that contribute to the tipping point:
- The Law of the Few: the impact of influencers.
- The Stickiness Factor: the impact of messaging and product desire on the market.
- The Power of Context: the impact of time and place or “luck.”
By understanding these principles, Gladwell predicted wisely that one could better predict and influence the factors that cause ideas and trends to go viral.
My thoughts on application to Bitcoin
As with any epidemic, Bitcoin has reached its tipping point, but not by solving real-world problems such as cross-border remittance, online paywalls, or login authorizations with any significant frequency. Instead, it spent over a decade in protocol and governance debate and morphed into a speculative bubble. We stand to lose the very essence of this ingenious creation if we don’t address the issues that matter.
The Law of the Few: Bitcoin’s initial adopters, innovators, and tech-savvy enthusiasts have been instrumental in introducing it to the masses. But as bitcoin gained popularity, a new group of influencers emerged: the crypto bros, the rent-seekers, and the speculators. These individuals, driven by the allure of quick profits or cushy consulting positions, have transformed the perception of Bitcoin into a speculative investment, causing drastic price swings and detaching it from its initial purpose. We need the visionaries and entrepreneurs to return to the forefront if we are ever to harness the true potential of Bitcoin. There is an opportunity here to encourage the creation of truly disruptive business.
The Stickiness Factor: Bitcoin’s stickiness lies in its distributed nature, its cryptographic usefulness, competitive security model, provability of otherwise complex data, and its ability to bypass many inefficient systems. But are these features being fully utilized? Not yet. To ensure Bitcoin’s longevity, entrepreneurs must tap into these attributes and build businesses that leverage the power of the blockchain. By creating solutions for cross-border remittance, online paywalls, and login authorizations, we can anchor Bitcoin’s value in its utility, not just in the whims of the market. Another principle for determining if something is a Bitcoin opportunity is to ask “do I need to reduce payment friction or increase data integrity?” If the answer is yes, you might have something sticky for Bitcoin.
The Power of Context: Bitcoin emerged amid the financial crisis of 2008, which eroded trust in centralized institutions, and people presumed it was a response to malpractice by the banks and the state. That defined much of the first half of Bitcoin’s life, and it still informs a lot of the messaging for the “store of value” people.
Today, the context has shifted. The world is moving towards a borderless digital economy, and the need for more efficient and inclusive financial systems is growing. The factions of bitcoiners have split from each other, and the experiments in boundless payments, trade, identity, and tokenization continue to rage. The time has never been more ripe for businesses to use Bitcoin as a tool to revolutionize the way we transact and interact online.
Principles and thoughts
Imagine a world where cross-border remittances are instant, cost-effective, and secure. Migrant workers could send money to their families without losing a significant portion to exorbitant fees, thus improving their living conditions and providing a lifeline to developing economies. Bitcoin-based businesses could create platforms that make this vision a reality, enhancing financial inclusion and reducing global inequality.
Envision a digital landscape where online paywalls no longer hamper access to knowledge and content. Instead, micropayments in Bitcoin could facilitate a fair exchange between creators and consumers. Such a system would encourage the production of high-quality content while ensuring that consumers only pay for what they truly value.
Consider a digital world with a single, secure login authorization that grants access to all online services without the need to remember countless passwords or expose personal information. Bitcoin’s blockchain technology could be the foundation for this revolutionary system, providing a secure, decentralized, and user-friendly authentication process.
How about tokenizing all assets so they can be more easily valued and traded?
It is time to shift the conversation from speculation to innovation. Let us not squander the potential of Bitcoin by confining it to the volatile world of market speculation. The power of Bitcoin lies in its ability to reshape the financial landscape, and we must nurture businesses that will turn this potential into reality. We must move beyond the tipping point and bring about a new era of technological and financial revolution.
I am very excited about the Ordinals colored coin protocol that exploded into the bitcoin consciousness this year. It could very well be a uniting factor that brings together value creators on all UTXO chains to share and value real assets globally! But so far, speculation on memecoins and JPEGs has ruled the day. While it’s great to make easy money shockingly fast, we need to be thinking harder about value creation too!
A call to action
Let us rally around the entrepreneurs who dare to challenge the status quo and build businesses that harness the true power of Bitcoin. And let us not forget the promise of a distributed financial future, where barriers are broken, opportunities are equalized, and trust is restored. By embracing this vision and taking decisive action, we can turn the fourteen-year long speculative bubble of Bitcoin into a transformative force that reshapes the world for the better.
So let us embark on this journey together, driven by the spirit of innovation and the conviction that Bitcoin is more than just a speculative asset—it is the catalyst for change that we’ve been waiting for. We just have to be bold enough to stop waiting.
What are some other books I should read to understand virality, the business cycle, and economics, so I can learn more ways to think about bitcoin in their context?
Watch: Kurt answers the viewers most urgent Blockchain and Bitcoin Questions
New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.
