It’s difficult to explain why I both enjoyed and disliked Cryptomania. On the one hand, it’s necessary to acknowledge that Andrew Chow, the author, and a TIME Magazine correspondent, is a very good, very experienced writer who knows how to move a story along in such a way that the reader is hardly aware that they’re engaging in the task of reading.

On the other hand, it’s odd that Chow decided that the best way to connect and explain the collapse of FTX and Alameda Research was through weaving together real-life tales of success and loss via NFTs.

Neither FTX nor Sam Bankman-Fried (SBF) were widely engaged in the NFT space so to choose them as the main through line of a 40-chapter book seems like a real missed opportunity to delve into the murky worlds of offshore banks, money laundering, and international arbitrage in crypto.

Cryptomania is both an easy read and a — sometimes manic — discussion about all things crypto-related that transpired over a couple of tumultuous years. It’s worth the time and money for those not involved in the industry and who want to gain a basic understanding of 2021-2023 in crypto. But, for anyone who lived it, who followed the SBF trial and woke up in November of 2022 thinking only about FTX, it may not be for you.

Retread with a flair

The book serves mostly as a retread of what brought FTX, SBF, and NFTs into the spotlight, and then what brought them down.

The best parts are, without doubt, Chow’s summaries and explainers. The individuals used as examples, however, are good for a quote or two but many just appear far too often. At the end of the day, it’s not necessary to hear the stories of three or four people who made it through NFTs and then lost it all.

Read more: Book Review: The Network State by Balaji Srinivasan

No Mention of TIME Magazine NFTS

There are moments where the media at large is criticized, including in chapter 18 when Chow points out the failures of numerous outlets to ask pivotal questions about FTX and SBF. Understandably, in this section, he doesn’t speak about TIME Magazine’s own venture into the world of NFTs and crypto — a project that, like many of the other examples Chow lists, has been abandoned and forgotten by its parent company.

This isn’t to say that TIME was one of the worst contributors to the NFT craze but rather to say that a writer who works for a company that went head first into the deep end of the topic he’s writing about, at the peak of the mania, should probably bring it up.

Chow’s focus is less on corporate NFT cash grabs and instead on individuals, many in the third world, who were initially met with success and then lost almost everything (sometimes by placing the money they earned from NFTs onto FTX). I must say again, however, that being a writer from a company that minted over a thousand NFTs should get mentioned.

As a strong critic of effective altruism, it was also nice to hear the story of Christine Chew, a woman who worked at a private equity firm, got into effective altruism, was a cryptocurrency advocate who ended up briefly employed at FTX, became disillusioned, and now works at an actual charity, trying to change the world through work and service as opposed to by making increasingly more money and donating it.

Read more: So you don’t have to: Catching Up to Crypto by Ben Armstrong

So, what is Cryptomania?

Cryptomania is a satisfying summary of what transpired as FTX and the broader cryptocurrency market collapsed a couple of years ago. But if you were hoping to discover new secrets about SBF, the end of 3AC, the Celsius Ponzi, or Do Kwon’s antics, you’ll be disappointed.

It’s also worth pointing out that the connection running throughout this book — namely the suggestion that there’s a link between the disintegration of the NFT markets and the end of FTX and Alameda Research — is spurious at best.

As Chow points out, SBF didn’t get NFTs or care about art, and while FTX hoped to capture a chunk of the NFT market, that was only because it was where crypto liquidity was, briefly, fleeing.

There are many stories of fraud, rug pulls, and exit scams in crypto that have yet to be told: no one can explain why Do Kwon is still languishing in a small Balkan nation, detailed writing has yet to be done on how Celsius, Luna, and 3AC all contributed to the death of FTX, a real biography of numerous big-name players has yet to occur, and no one has even bothered to write about QuadrigaCX and the death of its founder, Gerald Cotten.

I’m not sure the public is clamoring for another explainer of what happened in crypto in 2022. I certainly know that most people in the industry lived through it and can’t be bothered to go through all the details again. But if you’re one of the few who haven’t yet heard about failing cryptocurrency exchanges and JPEGS on the blockchain, this light read is absolutely perfect — and this isn’t a dig at Chow: someone needs to write this type of book for those uninvolved with the industry.

However, if you’re looking for the next Number Go Up (by Zeke Faux), the latest details of creepy international fraud, or exciting stories of globetrotting scammers and fraudsters, Cryptomania isn’t for you.

Alternatively, if you’re a writer like myself, know that there’s endless fodder for storytelling yet to be discovered or written about in cryptocurrency. In fact, even the FTX, Alameda Research, SBF story has yet to be fully fleshed out, so if you’re up for it, maybe you can write the next great American fraud novel.

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While Chris Dixon and a16z may have skewed the sales numbers of his recent book, Read Write Own, what hasn’t been given as much time in the spotlight is the book’s NFT offering.

Paired with the newly minted web3-worshipping tome is a bookmark that contains a code allowing readers to redeem an NFT on OpenSea (one of the largest NFT marketplaces). The problem is no one seems to care.

Of the 5,000 NFTs that are up for redemption only 5% — or 264 — have been redeemed by readers. It’s difficult to match this with the fact that Read Write Own landed at number nine on the New York Times Best Seller list. To achieve such a prestigious status there’s no doubt that Dixon and a16z moved thousands and thousands of copies, physically, through ebook readers, and via audiobook applications.

So, why isn’t anyone interested in the NFT?

It’s hard to say since exact numbers on who purchased the books are unattainable, but there are at least two likely reasons. Firstly, bulk sales were likely almost entirely to a16z itself, which will slowly be gifting the books to partners and companies it invested in. Alternatively, many sales were organic, and simply no one cares about NFTs. Either way, it’s negative for Dixon and his thesis presented in Read Write Own.

Read more: Chris Dixon says a16z doesn’t sell its crypto tokens — portfolio disagrees

Major crypto companies partnered to work on NFT

The Read Write Own NFT project was a collaboration between a16z, IYK, Manifold, Dynamic, and Optimism — large and important companies in cryptocurrency. In that sense, one might expect that the NFT would be interesting and perhaps have some degree of usefulness. That expectation would be wrong.

Instead, the NFT is a copy of the cover of the book and when it’s redeemed it changes colors and the pixelated sun moves around. That’s it, no more, no less.

Regardless, while the future of blockchains, tokenization, and NFTs remains to be seen, it’s clear that Dixon’s attempt to predict it and get credited for it has fallen on deaf ears.

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The post Chris Dixon offers NFT with his ‘bestseller’ — 264 of 5,000 have been claimed appeared first on Protos.

Entrepreneur and Andreessen Horowitz partner Chris Dixon recently released a book espousing the benefits of the blockchain, NFTs, and web3, entitled Read Write Own — and it’s getting mixed reviews.

From the highly critical Molly White complaining that “Dixon fails to identify a single blockchain project that has successfully provided a non-speculative service at any kind of scale,” to the more commendatory by David Z. Morris calling it “an optimistic read,” it’s safe to say Dixons literary efforts are dividing opinion.

However, regardless of how you feel about a16z, Dixon, or the future of web3, what’s clear is that the book did some serious numbers in its first week on bookshelves and via ebook sales. Indeed, the nonfiction title sold more copies this week than Britney Spears’ autobiography, The Woman in Me, and slightly fewer than bestselling author Donald L. Miller’s Masters of the Air, landing at number nine on the New York Times (NYT) Best Seller list.

Unfortunately, the revered ranking comes with a very serious caveat, namely that the NYT itself suspects that the title managed to get ranked by gaming the system.

Read more: Chris Dixon says a16z doesn’t sell its crypto tokens — portfolio disagrees

The list only adds a ‘dagger’ to titles it believes have, in some way, attempted to present more sales than real demand, a concept a16z is extremely familiar with.

Marketing isn’t enough

Dixon went on a massive marketing blitz in the lead-up to the public release of Read Write Own, appearing on podcasts like the NYT’s Hard Fork and a16z’s own show. Clearly, the push wasn’t enough.

The NYT states that including a dagger on the Best Seller list implies “institutional, special interest, group or bulk purchases,” and that such a dubious distinction only comes after “proprietary vetting and audit protocols, corroborative reporting and other statistical determinations.”

While ensuring profits and positive results can easily be manipulated in financial markets, it’s nice to see that at least organic book sales are being monitored and, as usual, a16z is doing everything in its power to make things look far more optimistic and profitable than they actually are.

Congratulations to a16z and Chris Dixon — I hope it was worth it.

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The problem with writing about cryptocurrency is that it’s complex. It’s economics meets cryptography, meets memes, meets extreme political ideologies, meets gambling, meets tech bros. And it’s genuinely difficult to parse one of these concepts without inevitably running into another and ultimately ending up in a mess and saying pretty much nothing at all.

Which is why Zeke Faux’s Number Go Up is not only a breath of fresh air but quite possibly the best book ever written about the cryptocurrency industry.

Cryptocurrency vs the cryptocurrency industry

Crypto advocates may well argue that Number Go Up doesn’t necessarily go into detail about how Bitcoin and Ethereum work, how smart contracts are deployed, and why cryptocurrency can change finance. And they may be right. But that’s not the point of the book.

Number Go Up is investigative journalism meets non-fiction and the goal isn’t to espouse the benefits and issues of specific protocols, but instead to examine under a microscope the industry that’s been built around blockchain, crypto, and Web3 over the past decade.

Access without the bullshit

Established journalist Faux, despite being relatively new to cryptocurrency, has been able to gain access to numerous major players in the industry. Some seemingly want to prove their transparency, others appear to be pushing for trust, but everybody looks to have an ulterior motive.

By the second chapter, it’s obvious that Faux is perplexed by crypto for all the wrong reasons:

“I couldn’t believe what I was hearing,” he writes. “I am not a computer scientist, but I don’t think you can call the concept of prices going up forever, for no reason, a ‘technology.'”

Which is precisely where Faux is wrong and the moment when the story kicks into a higher gear.

Executives, parties, and changing the world

Faux soon falls down the rabbit hole that is Tether and its quirky executive leadership, crypto’s cult-like conventions, and the Ponzinomics of the industry at large.

Thankfully, he’s able to fund trips to Nassau, attend BAYC-exclusive events, and venture across Europe to chase down everyone he can, from Sam Bankman-Fried and Jean Chalopin (Deltec CEO), to Brock Pierce to pseudonymous crypto critic Bitfinex’ed. Unsurprisingly, there are no heroes in this story.

Instead, Number Go Up wallows in the seemingly neverending depravity of fintech. “Somebody is lying,” former Celsius CEO Alex Mashinsky told Faux. “Either the bank is lying or Celsius is lying.”

All I could think was, “Why not both?

Number Go Up is a difficult but important read

As Faux has hinted via X (formerly Twitter), renowned authors like Michael Lewis clearly fell for the hype. They were seduced by the dream of completely overhauling the financial system and fawned over the likes of Bankman-Fried, certain that these crypto bros really were the champions of the common man who could finally get the upper hand on the Wall Street suits.

Unfortunately, as Faux finds out over the course of a few years, countless hours, and 242 pages, Lewis — along with celebrities like Tom Brady, Gisele Bündchen, Snoop Dogg, and Eminem — aren’t embracing the new, innovative financial system. They’re getting swindled by manipulative conmen who are doing an outstanding job of convincing everyone they’re “still early.”

Read more: SBF told to prep his case in jail while another FTX exec pleads guilty

I’ll tell you this: while Number Go Up is the best book on the crypto industry and Faux is an absolutely beautiful wordsmith, the reality is, as Bankman-Fried says bluntly in the final few pages, the sickness that has permeated every nook and cranny of the financial industry “fucking sucks.”

But everyone needs to read about it.

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In 1890 the United States census bureau announced the closing of the frontier. For its entire history up to that point, the area west of European settlement was seen in the US as a place of opportunity and freedom. But it also represented a social escape valve; a place where people who were unsatisfied with the direction of society could strike out and start their own. 

While American anxieties about the conclusion of westward expansion fueled investment in military and empire, people from around the world arrived by ship to its cities, driven by the same principle that drew wagon trains over the horizon.

The choice to exit a society, to leave and begin anew with the hope of finding greater prosperity elsewhere, was in many ways the quintessential feature of democracy and republicanism in the US for over a century.

In Balaji Srinivasan’s 2022 book The Network State, this principle of democracy-as-exit becomes the basis of a new society rooted in the values of decentralized finance, cryptocurrency, and web3. 

Srinivasan is described as an “angel investor.” He’s also the former chief technology officer for Coinbase and, since starting a biotech firm in 2007, has played a part in tech and crypto startups ranging from Cameo to Ethereum. 

The Network State relates Srinivasan’s plan for how and why people committed to the principles of infinite frontier and immutable money should start a country on the internet. 

Traditionally nation-states attempt to draw a coherent society under the control of a state by emphasizing shared language, belief, or cultural practice. The network state is slightly different.  

The network state is a social network with:

• a sense of national consciousness,
• a recognized founder,
• a capacity for collective action,
• an in-person level of civility,
• an integrated cryptocurrency.

Other hallmarks include, a consensual government limited by a social smart contract, an archipelago of crowdfunded physical territories, a virtual capital, and an on-chain census that proves a large enough population, income, and real-estate footprint to attain a measure of diplomatic recognition.

This is not uncharted territory in the web3 space. The “smart city,” or the “blockchain city” are concepts that should seem familiar. Even traditional nation states have a history of founding new capitals or high-tech utopias in the desert, which are meant to transform society and the way individuals live their lives.

What distinguishes the network state is Srinivasan’s willingness to offer an ideology of transformative change, one that presents anarchism to the statist and imagines a state for the anarchists. 

But the book is not the policy manual of a technocrat. It’s a political treatise that attempts to chart a middle way between the totalizing leviathan of the modern state and the myopia of its competitors.

In fact, nearly half of the book is devoted to its second chapter, which sets out to teach a crash course in interpretive historical methods. Notably, neither history nor political theory is portrayed here as the domain of objective fact. Instead, the founders of a network state must endeavor to hone their interpretation of subjective historical perspectives. 

These new founders must have, first and foremost, an interpretation of history that locates the society and its people as successors to the existing order. That’s because new “startup societies” cannot be solely driven by technological genius but instead by what Srinivasan describes as moral innovations, which are only possible if the founders of a nation-state have understood their place in a historical trajectory:

“Without a genuine moral critique of the establishment, without an ideological root network supported by history, your new society is at best a fancy Starbucks lounge, a gated community that differs only in its amenities, a snack to be eaten by the establishment at its leisure, a soulless nullity with no direction save consumerism.”

Storing history on the blockchain

Though critical of rising millenarianism around climate change and economic crisis, there’s a sense throughout the middle three chapters that the current order of sovereign nation-states is morally and fatally flawed. Therefore, the need to create a new state and a new understanding of history is made incredibly urgent.

To that end, one capacity of a theoretical network state would be to construct a blockchain ledger to track and maintain a cryptohistory. By associating historical documents with metadata stored on the blockchain, it would be possible to authenticate or reject historical arguments. Such an archive, Srinivasan suggests, could form the basis of a mathematical theory of history. 

In Isaac Asimov’s Foundation series he imagined a method of modeling the future actions of large populations, a science he called “psychohistory.” The story follows the rippling effects of Hari Seldon’s prediction that Asimov’s fictional empire would eventually fall, giving way to thirty millennia of dark age. 

The similarity to this science fiction concept is not lost on Srinivasan. In fact, he writes that with such a ledger, “…we may be able to develop Asimovian psychohistory from all the data recorded in the ledger of record, namely a way to predict the macroscopic behavior of humans in certain situations without knowing every microscopic detail.”

From this perspective, the gaps in our understanding of history (and of the future) are comparable to those gaps already filled in by modern science. Quantum computing and cryptographically maintained historiography will lend the network state the ability to steer away from the historical limitations of its forerunners. 

For four centuries the Westphalian nation-state has dominated history. The rise of centralized banking and fiat currency has greased the tracks for social, political, and economic development. To imagine the collapse of these systems is to imagine one of the most significant transformations to ever befall human society. Therefore, the viability of a new type of state must be predicated upon some sort of upheaval or transformation of the conditions that prop up the traditional state and its legacy capital. 

Srinivasan foresees a coming conflict between three sides, what he calls the “tripolar moment.” On one side of this tripartite is the statist ideology of the US establishment, the liberals who Srinivasan calls “woke capital.”  Next to them there’s “communist capital,” embodied in the totalizing state of the Chinese Communist Party. Finally, there’s “crypto capital,” otherwise referred to as “the people of the network.” 

In Srinivasan’s teleology of collapse, woke capital will increasingly struggle against economic and political crisis. As the world led by the US establishment encounters the realities of this future, nation-states will have to decide whether to descend into anarchy or embrace the authoritarian tactics of the CCP. 

Ultimately, the tripolarity of the moment is actually a contest between the nation-state with increasingly Chinese characteristics, impending anarchy in the West, and a middle way embodied by the network state. 

A network state for all

A good startup pitch presents a compelling problem and a solution that’s possible but, without required investment, currently out of reach. But often in these pitches, the relationship between the compelling problem and the proposed solution is tenuous. 

For instance, we might consider a question like, “how do we measure the consent of the governed?” Or, “what is the social contract,” and, “what do elite institutions owe to every citizen (or user)?”  These are the questions that might come up in the pitch of a startup society and they’re therefore anticipated in The Network State. 

Signing a “social smart contract” could be used to signal a user’s consent to be governed. This act of signing means giving some degree of control over to administrators, who in turn exert authority over a user’s adherence to laws and social norms.

This might be sufficient for moderating a purely online community. But Srinivasan writes that there is an assumption that the network state would become increasingly terrestrial. The book is vague on how a startup society governs an increasingly physical network state. Srinivasan writes:

“The short answer is that for a long time, it doesn’t — it leaves that to the surrounding legacy society, much like a centralized crypto exchange collaborates with traditional offline law enforcement. Eventually, if and when that startup society becomes a network state — in the sense of achieving diplomatic recognition from a legacy sovereign — then it can potentially take on physical law enforcement duties.”

Equally vague is how decisions will be made in the network state. Srinivasan’s description of how users log in and consent to be governed with a smart contract, giving up certain authorities to “administrators,” is actually one of the few moments in the book where detail is offered on the power structure and decision-making aspects of the network state. 

As with a startup pitch that struggles to explain how the product solves a compelling problem, Srinivasan struggles to explain how rules are enforced and decisions are made. In The Network State and in his public persona, Srinivasan is openly skeptical about the connotations of democracy. He warns in the book against interpretations of history “where political power is used to defeat technological truth.”

In fact, democracy is not mentioned often in the book and, when it does come up, it’s often in derisive quotation marks. “Democracy,” for Srinivasan is a term used by the people of the state to justify the types of policies that have created legacy financial systems, the hegemony of fiat currency, and the type of redistribution of wealth and power that’s prevented the petite bourgeoisie from joining the ranks of the ultra-wealthy.

In the tripolar struggle between the US establishment, the CCP, and the people of the network, democratic voice in political affairs is the distinguishing characteristic between statists in China and statists in the West. But for Srinivasan “voice” through “democracy” is ultimately an illusion.  

The democratic choice that matters most in the network state is contained in the decision to “opt-in” or “opt-out” of a society. If the barrier to entry or exit is sufficiently low, then people will be able to vote “with their feet,” as it were. 

If one were to read The Network State without any first-hand knowledge about human society, then they might be forgiven for assuming that there are no social problems to be solved aside from those presented by state surveillance, legacy financial institutions, vague social contracts, and the media outlets that obfuscate and manipulate the truth about all the above. 

It would be a lucky thing if that were the case, because Srinivasan’s book largely punts on the question of who holds power and on what basis. Besides, if one has an issue with how things are run in one network state, then they can freely leave and go to another or start their own altogether.  

But the hard questions about power tend to follow people over the edge of the frontier and beyond. Those who descend from immigrants, as most do in the US, should be familiar with this reality. People who left the old world for the new or left settled society in the eastern US for the opportunities in an unsettled west were not free of power or its attendant challenges.  

Experimental societies that resulted from exiting settled life in the US tended to reproduce intensified versions of whatever systems of power had dominated them before. Religious orders seeking a society governed by godly doctrines became insular and dominated by a worldy class of “elect.”  Communal societies eventually surrendered to the demands of profit and the market. Even the United States itself, founded in a revolution against the British model of state and economy, adopted both within half a century of the founding. 

The Network State is a thoughtful and necessary work in a web3 space otherwise defined by deeply flawed and unserious claims of social transformation. But more work is required to explain how and for whom this future will exist. 

For the minority with something to save and something to invest in the future, maybe the hard questions about power are actually resolved as subjects of the network state. It is, of course, they who should hold power. It is, of course, they who should wield it. But for the vast majority of people in the world who lack the benefit of that material position, they may reasonably ask what role they will play in Srinivasan’s network state.

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