It’s Time to End Maximalism in Crypto

The stakes are too high to turn on each other now.

AccessTimeIconSep 8, 2022 at 7:59 p.m. UTC
Updated May 11, 2023 at 4:53 p.m. UTC
AccessTimeIconSep 8, 2022 at 7:59 p.m. UTCUpdated May 11, 2023 at 4:53 p.m. UTCLayer 2
AccessTimeIconSep 8, 2022 at 7:59 p.m. UTCUpdated May 11, 2023 at 4:53 p.m. UTCLayer 2

“You’ve got a bunch of s**tcoins listed in your bio, why should anyone listen to you?” the self-proclaimed “Bitcoin maxi” once said to me. I muted my microphone and sat back stunned as I listened to the rest of his tirade.

Up until that point, I had been engaged in a constructive conversation on Twitter spaces with a number of bitcoin (BTC) investors and about 300 people listening on how to solve problems such as price volatility and privacy.

As a BTC holder myself, the conversation had been civil to start but quickly turned hostile when I brought up another blockchain project.

Alex Valaitis is the strategic advisor for the DeSo Foundation and author of the Web3 Pills newsletter.

What I experienced on Twitter spaces that night is an example of a concerning trend in the wider Web3 space known as “maximalism.” Crypto is composed of both technological and investable opportunities, a combination that breeds fanaticism.

The term “maximalism” was originally used to describe “Bitcoin maximalists” i.e., individuals who believe that bitcoin is the only blockchain-based digital asset that will be needed in the future (while also believing that all other alternatives are useless).

As new layer 1 blockchains have popped up, we’ve seen the concept of maximalism shift to include individuals that believe their prefered chain (and only their chain) is the future of digital finance or web infrastructure. This includes niche maximalists such as smart contract or EVM (Ethereum Virtual Machine) maximalists, as well as more specific maximalists, such as Ethereum or Cardano maximalists.

While it is not only acceptable but also important to have strong convictions when operating in an emerging industry, many participants cross the line in their attacks on other projects, often at the expense of the entire space.

The perils of maximalism

Advocates for maximalism will argue they are defending non-negotiable principles that exist in one chain or community but not another. This includes debates around decentralization, security and privacy.

However, what many of these folks fail to recognize is that technical solutions are often a question of trade-offs. What makes one blockchain excel on one dimension is precisely what makes it falter on another.

Bitcoin is extremely secure and decentralized. However, its settlement layer is fundamentally constrained in terms of the types of use cases and volume of transactions that it can support.

Solana is extremely fast and cheap but has been subject to network outages (something that Bitcoin has never had) and questions around centralization at the consensus level.

It would serve in the best interest of builders to explore all options and relentlessly build towards the path they have the most conviction in. Ultimately, it should be up to social consensus, i.e., the billions of people on the internet, to decide which models will win.

However, there’s recently been a war on new ideas and nuanced approaches in the Web3 space. Whether it’s well-known BTC maximalist Michael Saylor openly calling ether (ETH) a security or a lawyer bragging about suing competitor crypto projects while secretly being recorded, individuals are resorting to below-the-belt tactics to ensure their blockchain of choice wins.

The end result of this behavior is that many outsiders begin to view the wider crypto space as toxic and unwelcoming. More concerning, it can open the door for regulators to come in and overstep. Today it’s your competitor being shut down, tomorrow it very well might be you.

A better path forward

Despite some of the negative trends around maximalism, there has been a positive countertrend. Many participants are actively supporting multiple different blockchain projects who are taking radically different approaches.

This group of people believe in a “multi-chain future” or a future in which a large volume of transactions will be settled on a number of different blockchains as opposed to just one.

In fact, many of the people leading this charge are crypto projects themselves such as Cosmos with its Inter-Blockchain Communication protocol (IBC) or Chainlink with the Cross-Chain Interoperability Protocol (CCIP).

Even non-fungible token (NFT) marketplaces are deciding to get in on the cross-chain action. Renowned NFT marketplace Magic Eden made waves when it recently announced that it would be expanding beyond Solana to Ethereum.

Gone are the days in which NFT collectors only buy NFTs on one blockchain.

Raising all ships

It’s understandable that people get defensive about their blockchain project, considering many have not only put in time and energy but also money. The crypto space is still largely speculative, so there are perverse incentives for investors to “shill their bags.”

However, it doesn’t have to be this way. If we can collectively change our mindset to a “raise all ships” model, it will end up benefiting everyone in the long term.

Today, crypto and Web3 are still in their infancy. Only 300 million people have used cryptocurrency and the top dapps (decentralized applications) on Ethereum almost all have less than 10,000 daily active users.

Contrast this with the billions of people who use social media and the internet daily, and it’s clear how much room this industry has to grow.

If we can all work together to discover and build the best technologies, blockchains and dapps, there’s no reason everyone in this space can’t succeed to some degree.

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Alex Valaitis is the strategic advisor for the DeSo Foundation and author of the Web3 Pills newsletter.