Daily Balajisms – Crypto vs Big Tech

Every user becomes a root user

Balaji presents a detailed plan how crypto will disrupt the Big Five tech companies – Microsoft, Amazon, Google, Apple and Facebook.

Decentralized finance (DeFi) is disintermediating Wall Street and allows people to go bankless. Balaji explains how crypto will go after messaging, log-in, search, social networks, creator economy, operating systems, databases and compilers. We will see crypto phones, like Solana Saga hit the market soon.

Facebook is still founder-led and it can do radical changes, like the recent Meta rebranding. And the company had a Libra project back in 2018. Twitter was integrating BTC Lightning payments and tipping.

Balaji talks about how Google Search can be disrupted, not just from a recent ChatGPT competitor and OpenAI partnership with Microsoft. Google, after all those years, still doesn’t have a block explorer. Blockchains are open source, open state and open execution. And with web3 social networks the competitive advantage of Google search vanishes.

Web3 will reinvent CPA advertising model, with cost per action – by tracking the actual purchase of the product by customers, not CPM (cost per thousand impressions) as with Facebook and CPC (cost per click) as with Google.

Balaji explains that this transition will be similar to the one from desktop to internet. This time it will be from online to on-chain.

Until now, crypto benefited power users and the marginalized. So, both extremes, like investors and people in Venezuela or Lebanon, and not the average person who wants to buy a coffee at Starbucks.

During the GameStop stonks saga of 2021, Robinhood couldn’t handle the unusually high traffic, because its backend is connected to legacy banks with their pre-internet systems, where transactions take days to settle.

Fintech’s backends will get blockchain-ified, says Balaji. Crypto protocols provide globally uniform addresses, just like email does. And a digitally-native way to do global commerce 24/7, underpinned by the rule of code. Balaji explains, that crypto is to America as America was to Europe.

Blockchains offer a next step after open source – an open state, where databases are public too. They will disrupt messaging, because people want provably end-to-end encrypted messaging and will not trust Big Tech on their promises. With crypto, every user is a root user, and millions of people got used to have private keys. And Big Tech will be late in integrating bitcoin or Ethereum wallets.

Big Tech is risk averse. Balaji says that risk budget is more scarce than financial budget. People want secure messaging, social networks and content creation, where they are root users and can’t be deplatformed. They can log-in with their crypto wallet, or use something like ENS or Solana Name Service (SNS).    

Decentralized social networks are in their infancy. But they will disrupt also Google Search through block explorers. Secure crypto phones and new operating systems will disrupt Apple, Google and Microsoft.  

Crypto aligns users and turns companies into communities. From daily active users to inactive holders. It’s the new Aligned Movement, the web3 decentralization and recentralization around the rule of code.