Confidence, contempt and magic in BSV businesses

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It’s often said that the hostility between opposing political parties is nothing compared to the bad feeling between individuals within one party. I’m reminded of that by a few conversations recently with Bitcoin SV supporters whose enthusiasm for their own projects is matched only by their passionate contempt for others with different BSV-related hopes and plans.

I’m not a preacher or a teacher, wanting to tell everyone to play nicely together. But I have been wondering where all this enmity comes from. Because one of the powerful points made to me early on in my immersion in this world, by Jack Liu, of RelayX fame and more, was that any business that increases the use, or even just the profile, of Bitcoin SV will benefit everyone who has any interest in it. To borrow a political cliché: we’re all in it together. 

So why the bad feeling? I suspect it’s because there are still so many wildly different visions of what success would look like. Although there are plenty of confident, competent entrepreneurs in BSV, there aren’t yet the business role model equivalents of the early successes of the consumer Internet revolution: where are the eBays, the Yahoos or the Amazons, so obviously enjoying, in the jargon of the time ‘first mover advantage’? 

Instead of the ‘dot com goldrush,’ there’s only the despised ‘digital gold’ of BTC—which BSVers are, in this at least, united against. Meanwhile, new ideas and catchphrases come and go like fireworks, burning brightly for a time only to be quietly forgotten. 

Successful entrepreneurs are people who are, by nature, capable of believing in something that ordinary folk look sceptical about—and then sticking to their belief through thick and thin. But in the relatively small world of BSV, they’re often pursuing ideas that point in completely different directions. Does success mean getting Bitcoin wallets into everyone’s hands so they can trade cheaply and instantly? Is BSV merely the plumbing, which ordinary users needn’t even know about? Is Bitcoin SV itself just the first of a million kinds of tokens on the BSV blockchain? Will its blockchain replace the world’s data centres? Will it find its role hosting NFTs or CBDCs?

Of course, logically, there is no reason why all of these couldn’t turn out to be true—and there are promising businesses working towards each of them. But emotionally, as a business founder, if you are setting off down one path and you see another apparently intelligent entrepreneur with great conviction heading in a completely different direction, that’s troubling. How could they be so stupid? And every time you hear them encouraging people to look where they’re going, your own ideas seem to be being trashed. So trash back. 

Well that’s the best I can do for a theory of why entrepreneurs can be so rude about each other. It’s that others represent a threat, not so much through rivalry, but because they have such completely different ideas about the final destination.

So who should you back in this field of diverse ambitions? Is there any way to distinguish the winners from the no-hopers by studying their competing dreams? I’ll offer just one thought, from Peter Thiel, the co-founder of PayPal and today a big venture capitalist. In his book Zero to One, he says he isn’t interested in backing startup ideas that promise to beat the competition: he’s looking for those than can escape competition by doing something completely original: 

The perfect target market for a startup is a small group of particular people concentrated together and served by few or no competitors. Any big market is a bad choice, and a big market already served by competing companies is even worse. This is why it’s always a red flag when entrepreneurs talk about getting 1% of a $100 billion market. In practice, a large market will either lack a good starting point or it will be open to competition, so it’s hard to ever reach that 1%. And even if you do succeed in gaining a small foothold, you’ll have to be satisfied with keeping the lights on: cutthroat competition means your profits will be zero.

That makes sense to me. If you’re old enough, you’ll remember how people reacted when they first found Google, Facebook or Uber—with amazement, and then told their friends about it. If blockchain is just a more efficient way of doing what can be done already, that wouldn’t be good enough in Thiel’s book (literally and metaphorically). If your idea is to improve an existing service, he says, it needs to be able to do it at least ten times better. 

Remember Arthur C. Clarke’s famous quotation: “any sufficiently advanced technology is indistinguishable from magic”? I don’t know what’s going to work in BSV any more than anybody else does. But I’m pretty sure I’ll have found it if I start wondering whether it works by magic.