Forget the Great Reset. Members of the industry known as “crypto” (or is it “blockchain,” “digital assets” or “distributed ledger technology?”) attending this week’s World Economic Forum under the shadow of the crisis known as “FTX” are spurring a great rebrand.
In the wake of the Bahamas-based exchange’s meltdown, “crypto” and “NFTs” (non-fungible tokens) have become trigger words for skeptics who dismiss this technology as hot air with no utility – much as “blockchain” was viewed in 2018 around the initial coin offering (ICO) bubble, when, in one notorious case, the Long Island Iced Tea company infamously renamed itself Long Blockchain Corp.
Hence, there was talk of a new lexicon (we’re stuck with “crypto” for now) as business leaders tried to convince policymakers attending the talkfest in Davos, Switzerland, of the need for constructive regulation or sought deals, engagement or just acceptance by leaders of mainstream companies who’d also turned out in force.
I’m sure many readers of this column will recoil at this effort. Some may even see it as a centralizing power grab.
Maybe that’s fair. This annual gathering in the Swiss Alps, often cited for hypocrisy, empty talk and elitism, is a lightning rod among many who believe in the potential for cryptocurrency and blockchain technologies to upend the existing, inequitable global economy. You don’t have to share the conspiracy theorists’ views of WEF founder Klaus Schwab’s “Great Reset” idea to have concerns about the many Davos member companies and institutions whose business models perpetuate that system’s exploitative, centralized power structure.
But it’s also clear that “crypto” is now being widely associated with “have-fun-staying-poor” crypto bros and with what MIT Digital Currency Initiative Director Neha Narula calls “token casinos.” That the word now makes policymakers and executives squeamish is a barrier to progress for any crypto industry leader looking to engage with them.
It might not be such a bad idea to find words that don’t sound so foreign or threatening, words that encapsulate more universally and positively recognized ideas.
Brynly Llyr, the head of blockchain and digital assets at the World Economic Forum, suggested “decentralized systems” as a phrase that’s accurately descriptive of the function this technology plays without risking a negative association with crypto culture.
Others are simply resurfacing “blockchain,” hoping it will be more palatable to businesses that want to use these systems to manage enterprise needs. (One concern here is that word was associated with the “permissioned” blockchain systems once favored by business consortia, systems which weren’t really decentralized and added no real value as a result. Nowadays, with businesses increasingly building Web3 strategies on permissionless layer 1 protocols such as Ethereum, the retrograde connotation of “blockchain” may not be so bad.)
The industry’s language problem goes beyond the negative connotations of “crypto.” It’s also that catchall words lack precision and vital nuance.
For example, there are multiple types of tokens. These include commodity tokens like ether (ETH) that power public blockchains; store-of-value assets such as bitcoin (BTC); payment tokens such as USDC; and NFTs, which are essentially markers of scarce digital objects. All are often lumped under the label “cryptocurrencies,” which fosters an association with the traditional idea of “currencies” and carries distinct legal and political connotations.
Read more: What is Cryptocurrency?
This imprecision creates problems for participants in this industry when they negotiate over rules or terms of service with each other and with policymakers and non-crypto businesses.
“Too often we’re talking past each other,” says David Treat, senior managing director of Accenture’s blockchain practice. “People apply an argument about one domain which doesn’t really work with all the others.”
Treat is looking for a taxonomy framework that “allows us to see the interplay between the tokenization of identity, money and objects so that we don’t get sucked into one myopic facet of this and miss the wider, important conversation.”
Obsessing about words in this way might seem beside-the-point when the most important thing is to come up with protections against the kind of malfeasance that led to the FTX collapse. But amid reports that compliance officers are now giving banks blanket instructions to block services to any entity that’s touched” crypto” – if taken literally, a group that includes the likes of Microsoft, Starbucks and, ironically, BNY Mellon – it’s clear that we all need to get clearer with our words.
Read more: CoinDesk's Crypto Glossary
Who decides, though? This is not a central marketing department or chief brand officer that can dictate what brand labeling this industry should use. The market will decide which words to use.
So, for now, we’re stuck with “crypto.”