Interview With Mark Helfman, Author of Consensusland: A Cryptocurrency Utopia

A while back, I gave an interview to AtoZ Markets writer Maya Mandzikasvili. If you haven’t read it, check it out here or read it below.

Who is Mark Helfman to the public?

I’m a regular guy from the U.S. who fell down the cryptocurrency rabbit hole. When I’m not working my day job or chasing after my kids, I write for Quora, Medium and other cryptocurrency publicationsI’ve spent a lot of the past 10-12 years investing in different ventures, which have, fortunately (mostly) done well—but more importantly, helped me learn practical finance, markets, people, legal compliance and such.

So I bring a very different perspective on cryptocurrency than most people do. When I was younger, I worked in politics. For the past decade, I’ve focused on writing. I can talk to you about history, politics, economics, government, real estate, business, private equity… just don’t ask me about the Game of Thrones finale, I haven’t watched a single episode yet.

What is your mission in life?

If I can give people a better awareness of the world, I’ll be content with that. 90% of life happens beneath the surface, but we only see the 10% that’s in front of us. That includes the things we see on the news and social media. It’s like looking at a tiny window of a huge house. We make all sorts of judgments based only on what we see in that window. As a result, there’s a whole lot of knowledge and understanding we’ll never get—perspective that we can use to make better decisions, form better relationships with others, and lead more rewarding lives.

When was the first time that you get involved with crypto? 

I first heard about bitcoin at a party during the summer of 2017. I didn’t get what the fuss was all about. Seemed like a bubble to me. Something like two months later, somebody stole my credit card information to buy bitcoin on Coinbase. I worked out the fraudulent charges with my credit card company, but I also researched Coinbase, since I’d never heard of it. That’s when I started learning more about bitcoin. Then I watched a free cryptocurrency webinar by Teeka Tiwari. I dug in a little deeper and bought my first bitcoin using Abra in I think October or November 2017. It was like $300 worth, just to try it out.

As a crypto expert, we would like to understand what blockchain means for you? 

For me, blockchain solves a big, important problem with sending things to other people: you need somebody to vouch for it. For example, money. When somebody pays you, you need a way to know that their money is real, authentic, and worth what they say it is. You need somebody to guarantee that they have the authority to use it. 

Sometimes, that “somebody” charges fees, defrauds you, lies to you, steals from you, snoops on you, colludes against you, takes your sensitive personal information, or arbitrarily changes the terms of your transaction.

Humans have found many ways to solve this problem. Governments, laws, courts, settlement companies, clearinghouses, laws, banks, accountants, signatures, oaths…we have many, many ways to solve this problem with money. All entail some risk, cost, complexity, and the chance of human error. All can be corrupted. None can be scaled. It’s really hard and expensive to create any kind of uniform or standard outcome. 

With blockchain, you can guarantee everybody will get the results they expect, with none of the risks noted above. You no longer need to rely on government decrees, local regulations, or the good faith of strangers. Blockchain does that for you, with cryptocurrency to settle the deal. You can safely transact with millions of people who you have never met, with whom you have no relationship, who live in a country with different laws and regulations. 

Every single bit of value on earth can be recorded on a blockchain and bought or sold at any time using tokens like bitcoin. This is tremendous economic value and opens a whole new world of solutions to other problems.

Think about electricity, for example. Can you imagine how cryptocurrency will revolutionize energy markets? The world wastes hundreds of billions of dollars worth of energy. Some places produce more than they need while other places face chronic shortages. Creating a secondary market for unused or surplus energy will unlock untold economic value, but that’s a massively complicated, costly endeavor with traditional technology. Not with blockchain.

That’s just the tip of the iceberg. Imagine all the innovative approaches people will think of. That’s one of the things that motivated me to write Consensusland. It’s why I reached out to several blockchain teams to make sure every usage of cryptocurrency was realistic. This stuff isn’t an abstraction to me, nor is it a way to get rich. It’s a new, revolutionary way to solve vexing, persistent problems.

You portrayed in your book a world without cash and replaced by crypto. Do you think that it could happen in the near term? And if yes/no, why? 

How near is the near term? I believe cash will exist for a long time. Too many people like it. In fact, in my book, lots of people in Consensusland use cash—in the form of foreign currency, which they need when they do business with other countries. They just think it’s silly and inconvenient. They joke about it and compare it to post-it notes.

I have the unique perspective of growing up while the U.S. was moving into the digital age, and I talk to older people a lot. For people my age and younger, we can function perfectly well without ever holding our money in our hands. We’ve lived our whole lives with computer programs to handle almost everything else, so trusting a computer program with our cash doesn’t seem like a big deal. 

Older people, not so much. I’m certain they’d put up quite a fuss if you took away cash. Technology changes quickly. People don’t.

Even if governments started to issue their own cryptocurrencies on a blockchain, they can still let people hold a paper representation of that money. The technology exists. Over time, the money will lose its significance, not its value. Like horses. In most countries, people use cars to get around. Yet horses still exist. Some people find them useful and even enjoyable. Same with typewriters. It’ll be that way with cash, too. So-called “fiat” money will always have some utility. Gradually, over many years, fewer governments will use it. 

What are the pros and cons of crypto?

For me, the biggest pro of crypto is the ability to create global financial networks that everybody can participate in. Anybody can develop businesses and services that use bitcoin or Ethereum or some other crypto. As a result, potential innovations are limitless.

Compare that to a business. Visa, for example. When Visa wants to do something new or novel, it has to spend a lot of money on processes, systems, staff, staff training, vendors, facilities, legal, all that stuff, and they can only spend as much as their profits and creditors allow. With open, permissionless cryptocurrencies, anybody can do anything they want at any time—the only limits are time, talent, and money. It’s an innovation platform like nothing the world has ever seen. 

As far as cons? There are no cons, only scams. (He smiles.) 

How do you foresee the future of cryptos? 

I expect we’ll end up with something similar to what you see when you read Consensusland. Governments will use cryptocurrency as a way to better serve their people. Individuals will experiment with all sorts of new financial systems. People will treat money as a commodity, not a way to store wealth.

You’ll use crypto when you need to do something on the related blockchain. When you don’t need that blockchain, you’ll swap your crypto for another currency or stash it for a rainy day. You’ll have an app or service that instantly converts your crypto into fiat and back. You’ll never have to touch actual cryptocurrency. OmiseGo has a potentially great approach to doing that, but many people are working on their own methods, including some banks.

Many people will basically rent crypto for however long it takes to do what they want. Like Netflix for movies and Uber for rides. “Get your OMG card, instant access to all your favorite blockchains!” They’ll continue doing business with stablecoins or their local currency, only swapping as needed to get the benefits of whatever blockchain they’re using, and only for however long they need access to that blockchain. Depending on the interface and design of the service they use, they may not even realize they’re using cryptocurrency.

People just need time to transition to the new paradigm. I remember using Napster and Kazaa when they first came out. They sucked. Even some of my friends thought they were shady. Then Microsoft, Apple, and Netflix got involved and made it “safe” and convenient. I expect a similar trajectory with crypto—businesses will figure out ways to use the technology in safe, convenient ways. For example, Microsoft’s ION or IBM’s World Wire. That way, cryptocurrency will start to seem normal and useful. People will start to understand the significance and possibilities.

In any event, the notion of buying cryptocurrency as an investment will disappear. You’ll just use the cryptos you need and ignore the ones you don’t. Over time, blockchains that offer a lot of value will grow, along with usage of their tokens. Blockchains that offer little value will die, along with their tokens. It all comes down to usage.

Network effects are huge, we’ll see how it all shakes out. We’ll also have to see who solves the problems of interoperability, scaling, and oracles. There are several really interesting approaches, but without knowing how those technical issues get fixed (if at all), it’s impossible to predict how this space will develop.

Are there any valuable lessons about crypto that you want to share?

Yes, and it’s something I didn’t really appreciate during the 2017 mania.

From talking to so many people about my book, I have learned that we are so, so very early in the story of blockchain.

I hear a lot of people within the cryptosphere say “2017 the crypto version of the dot-com boom. Now we build solutions.”

I disagree. If you’re going to compare cryptocurrency to the internet, we’re more like 1990. World Wide Web had just come out, governments still hadn’t quite wrapped their heads around the technology, and the technology itself sucked. Compuserve was the biggest internet service provider and top modem speeds were 9600 bps. Cisco was only just starting to build routers and Microsoft was still developing Windows. Few people understood the significance of the internet and even fewer used it for anything useful. 99% of the world didn’t have a clue and investors just cared about making money.

That’s where we are today. Everybody wants to jump ahead to solutions, but we haven’t even built the tools we need to build the solutions. People are doing that now. We have such a bright future ahead of us. We’re building the financial networks of the future, but that will take time. Probably a lot longer than people want. 

Thanks again to Maya for reaching out to me. I hope you enjoyed my thoughts about cryptocurrency.

Relax and enjoy the ride!

Mark Helfman is author of Consensusland, a Readers’ Favorite 5-star book about a country that runs on cryptocurrency. You can also catch him on Medium. He publishes every Friday.

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