Please click the link to listen to the 31st episode of my weekly crypto podcast ‘Two Minute Crypto.’ These are intended to be short, single-topic ramblings on some aspect of the cryptosphere. Comments and critiques welcome.
Two Minute Crypto – Incentives
Welcome to Two Minute Crypto – This week I’d like to lift the veil on incentives in the cryptosphere. As most of us are not full-time project participants we access crypto news through digital media. We certainly don’t read the local paper to do so. Unless you’re looking for another Bitcoin is dead piece that is. The net abounds with readily available sources of crypto information. Dedicated news-sites, market trackers, YouTube channels, blog posts, podcasts, news aggregators – the whole gamut of data feeds, commentators and analysts.
As you navigate the reams of information before you, of course, you strive to assess the credibility of the source and over time build up networks of news faucets – places you trust to a certain extent to guide us through this quick-changing crypto landscape.
However, in the process of constructing these networks how much attention do you pay to incentives. By incentives, I mean why has this site, channel, podcast bothered to highlight whatever aspect of crypto they have taken the time to highlight? This is not a trivial consideration – When you encounter a YouTube Video With a title along the lines of ‘XYC the next Bitcoin?’ – A whole series of questions should arise – Why the sensationalist title? Why the marriage of xyz project to the most dominant? Is this a sponsored video? Are they holders of xyz? It’s only after taking time to assess such questions that the message can be properly interpreted. Remember much of the crypto space is actively incentivized to part you from your capital. Buy now/ Hurry/ Don’t miss out /xyz pumped 50% today / Looming drop in the market. Messages designed to prompt action rather than reflection bombard us.
Depressingly most crypto news posts are simply vehicles to deliver advertisements; a hang-over from legacy media – the content itself is secondary. Personally, I ignore such purported ‘news-sources’. I also regularly review my YouTube feed to remove news sources that have slowly devolved into sponsored garbage.
Now, of course, there’s nothing inherently wrong with incentives. Incentives are the reason there’s anything out there to follow in the first place, but a nuanced awareness of the drivers of content, news and so on is critical to contextualizing the service or information they provide. Services are a great tool just be careful you aren’t the tool.
The public comments or announcements of entirely respectable crypto figures such as Vitalik Buterin and Dan Larimer or an investment guru such as Peter Thiel have to assessed through the lens of incentive awareness. Someone who’s wealth is predicated on the future success of a project who then announces that it will take over the world is simply ‘talking their book.’ Sure, listen to what they have to say but first and foremost reflect on their incentive for doing so. This lets you filter out a lot of background noise and focus your limited time and attention as efficiently as possible.
Incentives can be very subtle – I once remember watching a certain You Tubers infrequent but very polished content for months before the long con the incentive behind it all – emerged. In this case, it was for a limited time only access to an absurdly overpriced crypto community. I almost went for it – then I ran the numbers and good sense prevailed.
Be careful out there folks – only you truly have your best interests at heart. Remember that. Verify don’t trust and even those you come to trust reverify from time to time. If you haven’t pondered my incentive for this podcast – you haven’t been paying attention.
Thanks for listening.