“Jack hates Eth,” one of Decrypt’s wags posted to our Slack workspace last night. This was right after Twitter boss Jack Dorsey tweeted his endorsement of a Twitter add-on, “Vicariously,” that helps people get out of their Twitter filter bubble via remixing their Lists:
I used @getvicarious to create and sync a list of all accounts I’m following, set that list to be reverse chron, named it “Latest” and pinned it, and now I can quickly swipe between ranked (algorithm) and all tweets as they happen
(inspired by an idea from team) pic.twitter.com/ZfSg9pGeds
— jack (@jack) August 12, 2021
Dorsey’s seemingly random screenshot showed who he was following on his own Twitter List—a BTC maxi named @notgrubles. And @notgrubles was saying some very mean things about ETH!
There are no coincidences
Perhaps this slagging of the world’s second-biggest cryptocurrency was a coincidence? Nope. “There are no coincidences,” the Zen Dorsey clarified 45 minutes later.
It isn’t exactly news that Dorsey loves him some BTC. He has said that he is working to make BTC the “native currency for the internet.” But he has also gone on record saying that he won’t even invest in ETH—nevermind that Twitter minted a collection of ETH backed non-fungible tokens a few months ago. (That ETH he gained from selling his first tweet as an NFT? He immediately converted it to BTC and donated it to charity.)
Increasingly, Dorsey seems to be expressing more contempt for ETH.
ETH is the anti-Twitter
So why does Jack “hate ETH?”
I think it’s actually the opposite: ETH hates Jack.
Oh, I don’t mean Jack Dorsey personally. Dorsey is obviously one of the great entrepreneurs of our time, and from everything I’ve read, I am sure he is a big-hearted fellow and a thoughtful guy who wants to do good in the world and leave it in a better place than he found it. Which is all that any of the best of us can hope for.
No, I mean that ETH is, ultimately, kryptonite for supercompanies such as Twitter, as well as Facebook and Google and any of the other massive, centralized public-owned platforms that most of us live on these days. ETH wins at the expense of places like these, which make their money by knowing as much about you, the user, as they can glean from the things you tweet, like and retweet.
Coincidentally—or maybe not!—a16z VC Chris Dixon yesterday unleashed a tweetstorm on “take rates” and how Web3 destroys the platform’s take of revenue and instead gives it to the users and content creators. “Today this trend continues as Web 3 startups begin to eat into the margins of Web 2 incumbents. The higher the take rate, the more vulnerable the incumbent,” said Dixon. He added: “Social media platforms like Twitter, Instagram, and TikTok have take rates of 100% — they don’t share any revenue at all with creators! That’s been great for them but bad for users.”
The myth of Blue Sky
Dorsey has repeatedly endorsed the idea of decentralization and in December 2019 launched Blue Sky, an in-house SWAT team to figure out how a decentralized Twitter might work.
My guess is that whatever results from this project will be decentralized in the same way that China’s various blockchain projects are decentralized—meaning, it won’t be decentralized at all. The problem Dorsey hopes to solve has to do with censorship and how to make his platform less divisive and less dependent on Twitter itself to police conversations.
But Twitter is a Web2 business, emphasis on “business,” and it’s hard to imagine a fully decentralized solution that will protect Twitter’s 100% margins. Imagine how that would play among the haters on Wall Street.
(Obligatory disclosures: Decrypt is, for now, funded by Consensys, an ETH incubator, but is editorially independent from it. I own 2.5 ETH and a tenth of a BTC, which I purchased in 2017 well before co-founding this lovely site.)