The world has fallen rapidly into emergency—and while some have hope for a swift recovery, the human and economic toll of Covid-19 will be felt for years.
To stop the spread of this deadly disease, the global economy is on lockdown. Weeks at home are turning into months, and the novelty has worn off. It's become clear that the effects of this crisis will be lasting and profound, and that realization has bred depression, anxiety, and helplessness.
#This is a moment for action.
Before the pandemic, our global economic systems were under stress. The stock market grew to new heights on the back of loose fiscal policy, but anyone looking at the costs of living, healthcare, and education could see that we’ve been losing purchasing power for the things we value most.
Covid-19 has accelerated that reckoning, bringing about what will surely be a deep recession. No one is completely immune to the effects of the pandemic, physical or economic. Those able to do their jobs remotely have been forced to adjust to a new normal without commutes, offices, or meetings. Millions who work in hospitality, service, and travel-intensive industries are losing jobs that may not return. No one knows how long the chaos will last, or what the new normal will look like.
Governments around the world are taking action to stanch the bleeding. They’ve reached for their trusty playbook from the 2008 financial crisis, dumping trillions of dollars of new money into the economy. At first, the stimulus will inspire hope. If 2008 is any indication, however, few people you know will directly benefit. Instead, the narrative will be that the `stimulus has "saved the economy", though the details will remain vague.
#Eventually, the bill will come due.
Many feel we are out of options, but from a fiscal perspective, this isn't true. In fact, we already have a cure for free money—Bitcoin. Bitcoin is scarce money, born from the failures of 2008, when our legacy financial system faltered, leading to a long downturn that hit the most vulnerable the hardest. The crisis we are seeing now may be worse: a physical contagion threatens people’s health, and the only recourse appears to require shutting down the economy.
Unfortunately, in the US we no longer have a major party that believes in fiscal conservatism: both the left and the right support invasive government measures and monetary largesse. A crisis of this size tends to expose the seams in society. Obviously, a large-scale response to the economic fallout of Covid-19 is expected. But why does that response always start with spending mountains of money we don’t have to prop up financial firms who should know better? In the midst of a panic, few are willing to point out the impossibility of sustaining this fiscal house of cards.
We haven’t come as far since 2008 as I would’ve hoped. The people whose livelihoods are the most precarious again look likely to bear the brunt of this calamity. The most insecure workers in the gig economy—those who lack savings and, in many cases, healthcare — are furloughed and laid off en masse. Meanwhile, friends of mine in private equity can afford to bide their time, waiting for the market to hit bottom so they can snap up deals at bargain basement prices.
I’m an unapologetic capitalist. A downturn for some is always an opportunity for another, and I don’t blame anyone for waiting for the right price. But do we have to print new money to gift to the financial sector, ensuring they can take the spoils of a downturn, and punishing patient savers that have avoided speculation?
This crisis hasn’t only exposed the seams in our economy—it’s also opening a window for authoritarianism. Even though it was authoritarian censorship that suppressed knowledge of the coronavirus’s early spread, many are now hailing China’s apparent success at “flattening the curve” through draconian, coercive means. People who in normal times claim to favor freedom and democracy now point to China’s authoritarian response to the virus as a model to emulate. More than a few have asked, “Why don’t our cops have smart helmets like the ones in China?” People are afraid, and constitutions are nearly being put on pause in the name of short-term safety.
But times like these are also when the seeds of bold, transformative change are planted and nurtured.
But times like these are also when the seeds of bold, transformative change are planted and nurtured.
This is our chance to deliver on the promise of Bitcoin since 2009. While traditional finance relies on fiat currencies, in-person meetings, and asking permission, crypto is built around permissionless transactions and unfamiliar counterparties. The teams that build in crypto—like ours at Keep and Fold — are often remote-first. We are able to continue operations almost as normal while this global situation unfolds. We are used to not knowing our counterparties face to face, and collaborate remotely by default. Skepticism of governments and regulators runs deep across our philosophies. We are ready for this. And it is our responsibility to use this readiness to double our efforts to bring financial access, as a human right, to everyone.
Not all crypto projects will succeed, of course. Most of them have shipped nothing, and many never will. Part of the reason for the mainstream skepticism that surrounds crypto is the fact that most crypto projects are nonsense. But amidst the noise, there are enough projects doing real, transformative work that their impact on the world will be felt widely. Those are the teams I’m speaking to now.
It’s time to ship. We have a chance to remake the world for the better. When people wake up from this nightmare, and the sugar high of free money, we need to be ready with a new vision of finance.
At Thesis, we ship. This week, we shipped Keep's random beacon. Next week, tBTC will open for deposits, giving scarce money superpowers and unlocking two thirds of the wealth in crypto to fully participate in an expanding vision of decentralized finance. Next quarter, Fold will ship the world's first Bitcoin rewards card, bringing a new wave of passive buyers to Bitcoin. All of these efforts will bring capital to the space, providing opportunity that can't be diluted by central bankers.
We aren't doctors, and we can't treat people's physical symptoms. But we are builders. And I believe it is our duty to ship an alternative economic vision, to make the world on the other side of this dark tunnel a fairer, more equitable place.
A crisis like this shows how essential finance is to everyday life. Let’s ship the future we’ve all been talking about, and show the world plan B.
