home > archive > 2014 > this article

Loading

Real-time self-government In the cryptocurrency frontier: The rise of altcoin populism, liberal-style, through Lockean dissent

By Daniel M. Ryan
web posted August 25, 2014

Why Authority?

If you're a Conservative, you believe in your heart and mind that one of the structural walls of our society is Authority. The proper scope and place for Authority more-or-less splits Conservatives and Liberals; it's certainly one of those kernels for yet another interminable round of arguments.

Strangely, recent scholarship by more-or-less secular scholars has shown that Authority is useful in ways that the inclined-to-shallowness liberal hasn't realized. These discoveries have not come from a new understanding of Sacred Scripture, nor have they come from straight history. To dig them up, you have to take a somewhat peripatetic journey through Public Choice theory, here-and-there snippets from anthropology, and a side exploration of specialized histories like histories of epidemics. One you're through this journey, long, "inefficient" and "wasteful" though it be, you'll look at our superstitious ancestors with a new and cannier eye.

Natives throwing the sacred bones to decide which direction the hunting party should go next? Assuming that their holy casting ritual more-or-less results in a random direction, they're actually breaking their hunting patterns free from the all-too-seductive Gambler's Fallacy. Provided the shaman throws the bones properly, to assure a random result, the hunting party's path will be completely unpredictable in advance by the prey animals – and by human enemies. As a side benefit, rolling the bones as the Hunter God commands will make the hunting parties spread out over the entire area over time. So, they won't gut a particular locale like swidden farmers do.

And they'll continue to do so as long as the Hunting God holds sway over them as an Authority. If some helpful debunker comes along and successfully explains that the Hunting God is aught but an imaginary myth, how long before the tribe's all-too-human judgment leads them into the Gambler's Fallacy? Or the seductively methodical slash-and-burn type of plan? 

Have tribesman declared that their Supreme Being absolutely forbids the eating of a provably edible animal? Laughable, right? Not so fast. What does the animal need to keep itself alive? Do its requirements compete with the tribespeople's own, in a way that'll add to the emergency when hard times visit? Are these silly, chanting tribespeople really pre-empting a public-goods trap? Or are they guarding against something even more obscure, something that only microbiologists would discern? Something that's usually dormant, but every now and then rears its head and smacks around an impious tribe like we enlightened Westerners were smacked around by the '08 credit crisis?

The clerics for a people absolutely forbid – in the name of a God – one group of people from ever fraternizing with or even touching another group of people. This one's a real toughie for us to understand, as a large majority of us deeply believe in individual rights – enough so that those who don't are obliged to pay blanket lip service to them. Thus, a system of gods that command something like this strikes us as both cruel and silly. We never even suspect that the voices of their gods make a good fit for the voices of their ancestors yelling about epidemics past that incubated in that populace of untouchables. 

Granted that these customs are inefficient and arbitrary relative to what we First Worlders have at our disposal.  But those who do not have the needed infrastructures, the specific tools and capital goods, and the specific intellectual capital needed to make our more efficient and humane remedies work, do not have the necessary advantages that we take for granted. The likes of us breezing in to "liberate" them from their "superstitions" amount to us urging them to throw away something in exchange for big promises of Western aid. To an un-star-struck and hard-headed native, those promises amount to "nothing". It's an unusual world where nothing beats something.

Would our society be less dynamic, less productive and less innovative if all of us believed that the '08 crisis was a divine punishment for us getting too chummy with the Spirit of Greed? Almost certainly. But, we'd also be far less likely to dance with that particular devil again. This little thought experiment shows you that the proper scope and limits of Authority, and the proper range and boundaries of Freedom, represent a very serious trade-off: one which innumerable wise and sober heads have devoted a lot of thought to. 

Fact is – as the multiculturalists never, ever tire of reminding us – those prisoners of dogma and superstition are the same model of human as we are. The multi-cultis would rather not follow along as we draw inferences, of course, but it's not that big a leap to conclude that we enlightened ones have the same capacity for "benightedness" that our fellow humans do. And as the Spirit-of-Greed counterfactual does suggest: the blithe we-know-better-now assumption, which asserts that our progress has rendered obsolete our need for that "superstitiousness," is not as open-and-shut as the cheery liberal with a certain I.Q. score self-assuredly states. Articulate self-assuredness can also be the earmark of a fool.

Now it is true that some systems of superstition make their adherents downright dangerous. But those types more-or-less identify themselves by their believers acting openly aggressively. Their threatening nature is about a subtle as a baseball that beans us on the head. But there are lots of other "superstitions" that do not match this obvious-as-a-rock criterion. The demarcation line between the two is pretty clear-cut.

But what's also cut-and-dried, at least to battered-around old me, is that we enlightened ones keep letting certain hard-won truths slip right out of our heads. Certain rules, principles and even laws, all profoundly counterintuitive, that we can't make stick in our noggins – even if we had to learn them the hard way. These truths, all of them initially hard-won through bitter experience, we have to keep re-learning the hard way again and again. Tuths whose follies to the contrary keep dragging us back to the old vomit, again and again and again.

Lest you think I'm being preachy, I hereby disclose that – despite all the reading and re-reading I've done - I still fell like a sucker for cryptocurrency socialism. Yep, given how I dived in, I might as well have been a more naïve type of low-information voter for all the good my prior learnings did me. In and of itself, my experience with crypto-socialism didn't scald me – but it did set me up for being stung later.

But my tale of being sent back to school will have to await a later part. This part deals with a major ruckus in Bitcointalk's Alternate Cryptocurrency board, which saw Miss Nxt being taken on by second-gen-crypto's answer to second-stage feminism. Only this variety was genderless. In fact, it hearkened back to the sexist old days when the only populism around was economic populism.

It's a story that has a lot to do with Authority and the peril brooked by those who would blithely disregard it. One of the major themes of those old maxims is the dangers of unleashing envy. It's the genie that seems quite controllable and co-optable at first, but it slowly grows to overwhelm its summoner. Anyone who dabbles in harnessing envy, as Helmut Schoeck documents in Envy: A Theory Of Social Behavior, eventually finds himself trembling before the genie he blithely thought he could master. Or else, being broken by it and turning into the political answer to <a href="http://en.wikipedia.org/wiki/The_Picture_of_Dorian_Gray">Dorian Grey: a Dorian Gray who sees satiation of envy as the ultimate in political beauty. As you'll find out near the end, the penultimate word on this drama comes from the still-resonant Authority of Plato.   

From Bulldog To Populist

Late in the night of December 6th 2013 Eastern time, a new face joined the Bitcointalk community. It took him about a day before he started posting, but only several hours to shift from first-post to openly asking to buy 0.5 Bitcoin's worth of Nxt. He did ask some due-diligence-type questions around that time, but he was certainly interested in second-generation cryptocurrencies. And definitely interested in Nxt.

One December 11th, he publicly vouched for the seller from which he got his first stake of Nxt . At that time, the first-adopters' realization of their sudden wealth was transforming into a genuinely generous side. As he settled into the early Nxt community, he became more and more skeptical about Fuserleer's eMunie. As noted >in the last part, Fuserleer self-confidently promoted eMunie in the Nxt thread – but this fellow, for one, liked it less the more he looked it over. But the more he saw of Nxt, the more he liked it. In a way, his criticism of eMunie's feasibility was a nascent profession of loyalty to Nxt. Very explicitly, he made it clear to Fuserleer himself that his skepticism should be taken as friendly suggestions. But as he dug in to his critique of eMunile's value-stabilization idea, he became more definitely critical.

Shortly after he put the eMunie matter to rest on his side, he bought another Bitcoin's worth of Nxt from the same seller at the then-prevailing price of 500 satoshis - five millionths of a Bitcoin – per Nxt. And of course, as we humans always do, he became more bullish after adding more to his holdings. He even undertook to defend Nxt publicly against someone who was complaining about the question that was becoming a burr in more and more altcoineers' saddles: the "poor distribution" (and of course, the subsequent sudden bonanza.) Interestingly, the murmurer was an original stakeholder who had internalized the growing hostility. Here is an exact copy of our not-first-but-early adopter's full response, on December 18, 2013 at 10:52:26 PM Greenwich Mean Time:

just like that ? leaving for a clone because of WTF ? Let's me tell you something. Original Coke is always the COKE. People go for and respect original ideas. I am not a stake holders and I bought NXT expensively because I like the idea and believe in the developers. Now the community around NXT is growing nicely.

I wish there is a way to compensate contributors deservingly. But the truth is no one knows who are stakeholders, perhaps some people announced that they sent money to the genesis block can be identified. But that's still less than twenty people. There are 73 accounts sending money to genesis block but one person may send multiple times. No one knows for sure if that happens or not. BCNext has a team. Who can be ascertain that BCnext team not already have 40-50% of total NXT ?

The only solution at this point to me is that if you believe in NXT project, you can buy NXT yourself. Why it is much more expensive than what the stake holders get. It is still very cheap comparatively to Bitcoin, Litecoin and even Mastercoin, Quark, or Protoshare. And remember you don't know who the stake holders are so it is no point to envy or blame them.

The positive energy has already been built up around this project. It is original and it is innovative. Let's not waste it. It is easy to technically emulate something but it is very difficult to build a network and energy around a project to make it sustainable. Bitcoin is one example. Many later clones can be technically better than Bitcoin but they lack the authenticity, the network and the energy of an original idea. And ultimately they all fail.

Yes, as of the opening of December 19th, our doughty adopter is just one of the stalwart defenders of Nxt against "FUD." But the exact words above were a penumbra of foreshadowing of exactly the same "FUD" that this same fellow's followers would be broadcasting all over Bitcointalk.

For this very same altcoin frontiersman would become the "Ambassador" of a new Nxt-like generation-two crypto that was explicitly branded as fairly distributed.

You have now been introduced to the gent who took up non-technical but open leadership of the soon-to-be-launched "New Economy Movement." Kindly shake the hand of UtopianFuture.

The Rise Of NEM And Crypto-Populism, Old-Style Liberal Style

One the eighth day of Christmas, UtopianFuture was gamely fielding criticism of Nxt – including the more frequent economic-populist kind. As is always the case with these disputes, one side's jealousy and spiteful rancour was another side's outrage and legitimate grievance. His only deviation from a loyal and resolute Nxt evangelist came on the ninth day of Christmas, when he all-but begged the now-hidden BCNext to make Nxt aliases freely transferrable. As Christmas arrived, the bulk of his posts worried over the Nxt blockchain and the resiliency of its P2P network against possible attacks. While worrying, he also revealed on the fly that he was a professional economist but not a programmer. He also expressed, offhand, another bit of foreshadowing: "We are already got blamed for initial distribution of Nxt which I think is just a moot point but you have to admit that the initial distribution does not look like it has a well-thought out plan at all."

He was still very much a Nxt loyalist, worried about a scam-dogged Asset Exchange destroying it, but he was now subtly telegraphing his Populist Future.

By Christmas Day, Eastern Time, he had returned fully to the loyalist fold; he also revealed that he was really excited about the potential for the Asset Exchange. At that stage, his doubts about Nxt's Asset Exchange looked like nothing more than the worrying of an Nxter mother hen. He was so in-the-tank at the time, he said on Boxing Day that he was "pretty sure I am going to quit my job at least temporarily to devote my full time time to Nxt if the official launch [of the Asset Exchange] goes smoothly."

As December turned into January, he was still in step with his fellow Nxters, still rebutting complaints from disgruntled non-Nxters, and still reassuring Nxters who had internalized the growing economic populism against them. At that time, the then-future "NEM Ambassador" was quite the capable and steadfast Nxt ambassador. But he also revealed a side that was a wee bit demanding. One ticked-off Nxter, whom UtopianFuture was chivvying, even implicitly accused him of nursing some envy against the first adopters. He dismissed that accusation out of hand, rather abruptly, in part because his put-upon canvassee showed a touchy defensiveness that's still inside the Nxt community to this day.

As December came to a close, he was showing that the unfair-distribution populism was starting to get to him. The tipping point came with his dislike of big Nxt stakeholders merrily forging more Nxt but not pitching in, or not seeming to pitch in, to develop the Nxt ecosystem. This complaint was precisely why he was needling that above-cited first adopter.

Like so many otherwise-free-market economic populists of the past, his bugaboo was that some of the Nxt-rich seemed plumb lazy. They appeared to be lazy hoarders, content to earn block rewards via forging like an old-style trust fund boy clipping bond coupons to finance his freestyle lifestyle. At first, his complaint was purely pragmatic; he thought it would hinder the growth of Nxt:

I am all for freedom and decentralization. But if a system want to survive it has to stay on an equilibrium, the system is flawed if there is a tendency toward a disequilibrium where all economic activities come to a halt as all nxt become dead money sitting there does nothing.

That is a feature of the system which needs to be thought about.

But eventually, his emotional dislike of coupon-clipper holders and forgers would emerge fully. That explains the apparent paradox of a citer of Milton Friedman shepherding a whole slew of populists. Like so many economic populists of old, UtopianFuture began as a straight Lockean emotionally adhering to that part of Locke that libertarians and other free marketeers still cite approvingly to this day.

At first, his unconscious demandingness primarily showed in him becoming more and more exasperated at the continual assembly line of Nxt critics. He was turning from a patient convincer to a pro-Nxt bulldog. His own doubts, as shown above, he held up as being for the greater good of Nxt. On the opening of New Year's Eve, Greenwich Mean Time, he presented his dissent as coming from a committed fellow Nxter bringing something to the party that even BCNext lacked: grounding in economics. He did so in the context of an agreement-feast.

But, around high noon New Year's Eve 2013, he first openly referred to the objects of his bugaboo as the "rentier class:"

When 1nxt=1$. It would be too much to do anything if it cost at least 1$. But I doubt the rentier class would agree to do anything until the whole system grinding to a collapse. Before that happening, I would take the source codes and make a truly working, economically sensible decentralized system.

With the benefit of hindsight, and admittedly with the benefit of hindsight bias, his break with the Nxt world was subtly telegraphed. When 2013 became 2014, he began to thump the tub about the benefits of decentralization. But he did discard those urgings to help out a victim of a bogus Nxt client who had been robbed, and to spend many posts raising a hue-and-cry about the theft. He also passed along the finding of a Nxter and Java expert user named notsoshifty, whom you'll meet again in the final part of this series. He still stuck to habit of cheerleading Nxters who were hard at work developing the ecosystem, and of reminding everyone that he was acting in the spirit of BCNext's vision. By mid-January, he was a global moderator of the main Nxt forum and more-or-less a member of the informal Nxt steering committee. At the very least, he was acting like that. His cheerleading gradually gave way to advice-giving, primarily on integrating voting and the proper scheme for a bounty plan, albeit as a fully-conscious stand-in and understudy for BCNext himself. He also kept buying more Nxt when he had the funds.

A more immediate foreshadowing of what was to come took place late night January 18th, when our UtopianFuture applied for a stake in a Nxt "descendant" called NEX. It was billed as based in Nxt, but only conceptually.  Once the development was finished, it would effectively be Nxt with improvements. Portentously, NEX was billed as "Complete Fair Distribution - Zero Cost Buy In!" Near the bottom of the announcement, there were four memes on the theme of "fairness."

Really, something like NEX was inevitable once a business-savvy dev figured out that the incessant complaints against Nxt's "unfair distribution" – neatly analogous to the second-wave feministas' complaints about the Miss America pageant – was really consumer demand in disguise.

Yes, sir or madam, this savviness explains exactly why there are so many rich uberliberals like Michael Moore bellowing as if they were wearing thrift-shop rags. They do so because they're making very nice livings doing so, and because "I The Disadvantaged" (in one form or another) is their brand. If they resolve the performative contradiction between their po'-folk words and their affluent lifestyles, they'd wreck their brand faster than "New Coke" almost wrecked Coke's.

And even if they did, even if they did after seeing a Sign from God Himself, they'd only be creating a supply vacuum that would be filled by another contendah like Morgan Spurlock. As long as the underlying demand is there, as is seen most clearly for certain substances that are flat-out illegal to even possess, the supply vacuum will be filled.

Because Nxters had already had some experience responding to the essentially populist "unfair distribution" charge, the NEX thread was soon peppered with Nxters badmouthing the project. Again portentously, UtopianFuture was not one of them. He was one of several Nxters who were genuinely interested in the project and wanted a stake. At the time, this got a jocular complaint about him from a more enthused Nxter: "…some [Nxt] ambassador [Roll Eyes]"

There was a portent of a different sort, albeit in a joking vein, from Bitcointalk member MadCow: "I'm in too, and I'm going to make 100 sock puppets [to claim 100 more free stakes even though everyone was supposed to get only one]." This foreshadowing became very "live" when cryptocurrency populism transitioned into cryptocurrency socialism.

"if in a week NEX looks good I'll make 1,000,000 sock puppets - bitcointalk.org account mining. less electricity than bitcoin mining" From the same MadCow, who continued in the same vein with more jokey criticisms about the Free, Fair and Flawed distribution model. By this time, "Free and Fair Distribution" had not yet become the fad it would become when winter had turned into spring.

At this point NEX was just an exotic response to complaint-demand, which Nxters had decided was a quasi-joke. UtopianFuture did join in the joking, but his first contribution actually looked semi-serious: "No I don't want all the beggars who contribute nothing have all the coins. How about I send you 10$ I take 200 million NEX and we have a genesis block tomorrow?" The dev of NEX, FrictionlessCoin, took this perhaps-joke seriously and disqualified UtopianFuture three minutes after he had posted his wisecrack…or his telegraphing of a plan he had already formed.

As the thread grew, genuine interest was slowly outnumbered by the jokes. But on page 6, a little before midnight January 19th Eastern Time, a post from UtopianFuture announced a new project that he was heading up. After dropping the link, he posted "I am very serious about this."

He was indeed. The project he had announced, his new "baby," was NEM. His opening statement?

A groundbreaking crypto-currency that gives control of their economy back to the people and establishes them as sovereigns over their own destiny.  A currency is an expression of a political ideology and social attitude.  Do not mistake us as just another cryptocurrency.  We are more than a cryptocurrency, we are a New Economy Movement.

He later said, perhaps because of the feline nature of the support he quickly attracted, that NEM also stood for "No Envy Movement." To his credit, he did try hard to live up to the second motto.

For a time, he also hewed to the collaborative approach. NEM would be like Litecoin and Nxt would be like Bitcoin. But he also unfurled the same demanding side he had shown when he had still been Nxt's bulldog. He also pegged himself as the "NEM organizer/ promoter," and later as the "NEM ambassador."

This was the distribution plan he had organized for his baby, which he put in his announcement post:

The fundraising is especially designed to promote fairness and egalitarianism. This is the first funding scheme of this type ever and we believe it is revolutionary in its effort to bring egalitarianism to the crypto industry.

If you do not have a Bitcointalk account yet, you need to create one to reserve a stake spot. Do not lose the account password, because you will need to access the account later to claim your share.

In the first 20 pages, stake spots are reserved only by showing "interest". After page 20, a fee has been introduced for late adopters. People who join after page 20 will still be distributed an equal share of NEM but they have to pay a fee to join in. Then after every 10 pages, the fee will be adjusted as a multiple of the initial fee. Another way to reserve a stake spot is to promote NEM to the outside community. Condition of promotion for a stake spot will be revised every 10 pages by the development team. We would greatly encourage you to spread NEM's idea to mainstream people outside the cryto-community even when you have already reserved a stake spot.

After we reach a critical mass, we will launch the NEM genesis block, (we plan not to have more than 4000 accounts in total…). A total of 4 billion NEM will be distributed equally to all adopters. That means every stakeholder will have an equal and fair share of NEM when NEM blockchain officially starts. Then you can sell- buy NEM freely and let the market forces determine the price.

One Bitcointalk account is entitled one stake spot. If you send more than the required amount at one time or multiple times, we will consider it a donation to NEM.

As you may have guessed, this put UtopianFuture in the spot of growing and defending a new altcoin clan whose natural base was the same people he had battled against less than a month previous. Originally, he had announced that NEM "is likely to be a fork of Nxt code. I love NXT and I admire the brilliance and vision of NXT inventor BCNext. His idea of a decentralized world is beautiful and in that world we should have more forks of his work such as NEM." Given his past, of course, these words were 100% sincere.

Perhaps inevitably, some of the more loyal Nxters churned out flack directed his way; they may have even quietly compared UtopianFuture to a certain fellow in the Gospels. But even if they hadn't, they were to become increasingly aware that NEM would become the focal catchment of the economic-populist headaches they had to deal with on Bitcointalk.

A foretaste of that came from UtopianFuture himself, in an extended and assertive defense of his contention that Nxt's voting system should not be weighted by the amount of Nxt a voter held; it should not be like the voting system of a listed corporation. He still worded his stand in terms of pragmatism, but his arguments were laced with terms like "too much the rich biased for my taste",  "club of big stake holders", "some people just doesn't like the idea that some rich guys can buy their votes", "buying votes", "Rich-based voting is a dead sentence for community building", and "NXT rich guys club". It was the most insistent he had ever been to his fellow Nxt insiders.

In the same post in which he first used "rich guys club," he said – perhaps in the heat of argument:

Well just let me be direct here. If you guys want to keep the rich-based voting and makes NXT rich guys club. I am going to make a fork as soon as I can.  It is open source community after all. I already have a thread  going here [this was his NEM announcement thread – your humble fact-checker] and I have several million NXT in funding. Someone is going to do it anyway so I will do it first when my millions of  NXT still have  some values.

And yet, earlier that same day he had said to someone criticizing the "greed" of Nxt's first adopters: "Greed is good. Greed makes this world function…. That's famous quote from the movie "Wall Street". I am just paraphrasing [Smiley] don't need to hide the brutal truth." So it's clear that his insistence, increasingly laced with economic-populist rhetoric, was only part of a family infight. To the rest of Bitcointalk, he was just as loyal to Nxt as he had been before he started NEM.

But before that family fight started, some Nxters didn't take a shine to his NEM although they were mostly good-humoured about it. Maybe, their skepticism came from their suspicion that some of the earliest "interested" in a then-free stake of one million NEM were not that idealistic after all: a few were openly venal.

One Nxter, the day before that family fight started, was openly satirical. From tk108: "100% for copy and paste off [NEX….] This is officially a new [crap]coin and will be featured in Edition 4 of Today's of [Crap] and Scam coins" UtopianFuture at least ostensibly ignored it and just replied with a thank-you-for-your-support. The same tk108 later edited that same post to say that he was interested for real, slipped UtopianFuture a then-unnecessary payment of 10 Nxt, and made sure his original barb vanished.

The first burst of unretracted flak was not a scold or warning but a good-natured roast. The same MadCow who had  joked  about sockpuppeting in the NEX thread posted a joke thread announcing a new Nxt clone called "ME.TOO." MadCow's original ‘announcement' post was a lightly-airbrushed satirical clone of UtopianFuture's NEM opener. As subsequent posts revealed, "ME.TOO" was treated as a funcoin. UtopianFuture was good-natured about it, but he didn't miss the chance to promote NEM there.

And MadCow's good-natured poke did get the venality out of the NEM thread. It was soon replaced by plain expressions of interest and discussions about the implementation of the distribution model, which were brightly derailed by a good-times giveaway by UtopianFuture. Everyone who posted "I Love NEM" would get 5 Nxt directly from him. He used the giveaway to urge people to spread the good word about NEM far and yonder. 

But it didn't take long – less than three hours – before the first doubt was expressed. From Camilio: "I dont get it. Where is the difference to NEX? Yeah I know there are 3 Billion more coins. But that´s all. you copied the announcement completely from NEX, or NEX copied your announcement."

And that prompted, fifteen minutes later, the first slightly barbed joke about NEM. From sparta_cuss: "The difference is that NEM is made from recycled drinking straws and smells like honeysuckle."

But seven hours later, after another run of "interested" posts, Nullu popped in with the first openly skeptical post about NEM:

This is a shameless copy/paste from [the announcement for NEX – which, by the way, still hasn't gotten off the ground – your humble scribe].

You have been warned.

Even if the coins are free, ask how many will be kept by the developers, and then consider how much your NEM would be worth if they were ever exchangeable for BTC.

But UtopianFuture fielded it politely, still sticking to his collaborative approach – even if something might have started bubbling in his unconscious that jetted out in that family fight over Nxt's voting system the following day. "NEM is silver compared to NXT which is gold. If you missed the Bitcoin train, the Litecoin train and the NXT train, this is your chance. And this would be the fairest coin ever because they are free and distributed equally to all."

His reward, in a sense, for his 100% collegial approach was for NEX developer FrictionlessCoin to be the butt of Nxter jokes in this thread. At the time, UtopianFuture just joined in the fun.

Half a day after the fun, and fatefully, UtopianFuture's old comrade-in-arms 2Kool4Skewl – the same pre-sale investor who set the post-issue price 50 times above the pre-sale price by buying 15 million more Nxt for 15 Bitcoin, as detailed in the last part - posted this enthused request: ""Super interested!" At the time, he was one of many who formed a quickly-expanding list of Bitcointalk members who were "interested;" many of them were Nxters drawn in by UtopianFuture's earned repute in the Nxt world. As the page count for the thread passed the free-giveway cut-off of 20 pages, there appeared an offer to pitch in. Suggestions also started appearing, prompting UtopianFuture to open a dedicated NEM discussion thread.

As January turned into February, the suggestions grew and multiplied. Soon, common dreams of the new and important features of NEM would be a bonding ritual that would make the NEM community as cohesive as the fanboi community of Apple. Without knowing it, UtopianFuture had made himself the Steve Jobs of the second-generation cryptocurrency world.

But only he knew that he had a little secret…

The Fanbois Assemble…And Start Leading Their Leader

When the free-giveaway slots ran out, the NEMsters who were late almost universally paid the new fee. At that time, UtopianFuture's competitive streak did emerge – his kind of competitive streak - but his punching bag was the above-mentioned NEX. With respect to Nxt, he was still nothing but respectful. And really, he had good reason to be. Just prior, he had been part of the guerilla-style dream team and a lot of his still-then-friends were signing up for his NEM.

Moreover, he had good reason to keep a collegial disposition. People started spreading the word about NEM on their own in blog comments, Facebook posts, outside forums and even their own Websites. By the time the application thread reached the next barrier signifying a ramp-up, Utopian Future had set up a NEM discussion thread. It was there that the full-bloom fanboi subculture blossomed. Utopian Future's original post was written in the wee hours of January 21st 2014, Eastern Time. The final after-the-start edit shows a well-organized project with a team that, for crypto land, is huge. The first posts after his original show his initial plan to make a clone of Nxt, which he prudently deferred to April when the Nxt source-code flaws would be (and were) revealed. As documented earlier, these flaws were intended to make it difficult to clone Nxt. But, they had the side effect of generating a lot of interest and examination of Nxt's source code. As a publicity stunt, it ranks in Bitcointalk's top ten.

But, as publicity generator, those deliberately-introduced security flaws were destined to be decisively bettered by the hot new NEM. As the fanboi culture coalesced and even hardened, UtopianFuture's own publicity stunt – to the extent that it was – beat Nxt's hands-down. He had successfully tapped the simmering economic populism in altcoin land, in a way that – in the early days - was truly "No Envy." Even if he had to use NEX as a whipping boy every now and then.

During the heady morning of January 22nd, he almost casually, almost blithely, set himself up for the first clash that rocked the crypto-2.0 world and brought his "No Envy" collegiality to a save-it-for-Sunday end. On the grounds that it was okay if sockpuppeteers got multiple stakes after the giveaway phase was over because they'd have to pay multiple fees, he decided:

I won't prevent multiple buy-in. It is impossible to prevent people making two- three accounts and register for them. But it won't matter much as our user bases would be huge. Furthermore, it takes time to make multiple accounts. It takes time to manage multiple accounts. Later on you would need to provide me passwords on these accounts. That's a lot of work already and if someone can go through all of that they have shown a lot of interest in NEM and probably deserve their stakes. And at this point, more accounts means more development fund to NEM. So I don't see the need to prevent multiple buy-in. It is very different from someone putting 10.000 NXT in and buy 10% stake of NEM. I very much doubt anyone can have more than 5-6 buy-ins. I hope this explanation clears the worry about double buy-in.

And the new and growing NEM community was seemingly fine with this policy until a Bitcointalk member named TheMightyX had this to say a little after high noon Greenwich Time on January 27th:

This is bull[----]…You could have at least attempted to do things fairly by limiting stake to accounts created over a week ago, limiting multiple buy-ins, simple taint analysis (scan address list for duplicates) etc, etc.

Maybe you are only interested in the pledged btc/nxt and not the success of NEM?

At this rate we will have a lot of users with 20-100x stake in NEM at launch. Yes, imagine fairness indeed.

A fair coin is moderated by the people. If you ask the people, no one wants people to be able to buy in multiple times (except those who have bought in multiple times).

Yes, UtopianFuture's promise of economic populism had finally elicited the inevitable escalation. He first ignored  TheMightyX's complaint, but the latter was not at all dissuaded by someone trying to calm him down: 

You obviously didn't understand the criticism. If this coin is modeled on fairness how is it fair that some people can claim more stake than others?

It doesn't matter that the amount of stake doesn't change. The fact is if someone gets 20x stake, his value is 20x that of mine.

I get 1 million and some unethical person gets 20 million? it also devalues the value of everyones stake. If we have 3000 stakes but only 2000 users then we have lowered the value (inflated) our stake by 50%

Isn't that quite obvious?

Every single fake account devalues your stake. That is so painfully simple I can't explain it any more straightforward.

This complaint of his was actually the latest of several, each one more insistent than the last. And this time, the persistent TheMightyX got Thingamajig seconding his opinion:

Also, someone who's likely going to go to such lengths will also be untrustworthy with their large stake. Likely selling out and ruining a market before it's even taken off.

I think at the very least, the creator should stop people from asking for a stake if they made their account AFTER the date of the thread.

Followed by another who concurred. Significantly, this assenter to Thingamajig's milder concurrence was a member of NEM's then-official team:

your very last sentence there echoes my statement, but the [f]ounder here's stance is that he is marketing NEM to brand new users of crypto currency.  So looks like just not doable.

Yes, it was the classic temporizing maneuver long used to deflect hot-blooded economic populists. "I'd love to do it, but it's just not feasible. My heart is truly with you, but…" As I'm sure you know, the record of this temporization as a deterrent is uneven. In the world of the "New Economy Movement," as is often the case in the wide wide world of politics, "not doable" was not final.

As became clear quite soon, not everyone was buying it: an all-out debate got underway. Again, UtopianFuture decided that the best policy was for him to ignore the controversy. Instead, his next post at the time the debate got rolling was a more-or-less businesslike report on the work he had done on the stakeholder list. But this time, the issue did not fade away.

It did, however, remain on a sideline as the discussion of what NEM was to be continued. Soon after that issue got rolling, the volunteer chief dev Jaguar0625 announced that his vision was to make NEM more than a straight Nxt clone. Instead, he planned to give the NXT code an all-out overhaul. That announcement kicked off the techie fanboi part of the culture: feature suggestions started to trickle in. Later, that trickle would become a steady flood of excited discussion. To the extent that NEM remained a "No Envy Movement," the fanboi part was responsible.

But just beforehand, a darker side of the "New Economy Movement" had begun to show. The populist –the liberal-style economic populist - side of the NEM community had made itself heard. The issue of what constituted "fair distribution" remained civil, but a line had been crossed. Ironically, and portentously, ThePatient had this to say about the No Envy Movement part of NEM: "Can the 'no envy movement' part get dropped? too hippyish, imo"

Too hippieish. Too kumbayah-ish. Not red-meaty enough. Not red-blooded enough.

Besides, according to a concurrer, "The "No Envy Movement" part just makes me think of NXT."

Although still obscured at this stage, it was dimly evident that the red-blooded, red-meat, hippie-averse populists in the NEM community had a certain image in the back of their red-blooded minds when they thought of Nxt…

The People's Champion…

It wasn't long before UtopianFuture found himself being led by the more populist of his followers. When he stopped ignoring the issue, he agreeably and even casually said that he would impose additional controls on multiple-stake ‘grabbers' – but not retroactively, as that would be unfair in a different way. As you probably have guessed, this reasonable compromise turned into temporizing. The populists in the room were not satisfied: they wanted retroactive.

Oh the tangled web we weave, when't  ‘money fair' we aim to cleave…

Moreover, he found out another of the wages of economic populism on January 25th. Unlike the other complaints noted above, a certain laddo with the nick subSTRATA – a Bitcointalk member of much longer standing than UtopianFuture himself – angrily complained that the whole fundraising framework was unfair: "How come it is fair when some people got their share of coins for free but others have to pay more and more for the same? It is a scam!"

UtopianFuture tried to gently remonstrate with the fellow – "Please no envy, no hate and be considerate to others." I'm quite sure you can guess what kind of response that UtopianFuture's gentle, liberal chiding elicited: 

Really? I am supposed to be considerate to others yet you are cashing on everyone who joined a bit late AND on "development" coins?

Who the [---] are you anyway? Can you "developers" code anything? I think not, you are waiting for NXT 0.6 to be released and then you will make your own genesis block and do nothing but copy / paste what NXT developers are doing. Pretty much anyone around here can do the same and as soon as someone who is greedy less than you puts out a clone "your" coin is about to be abandoned.

You are not after anything but making money off retards. Cool story on starting post (copy / paste much from NXT, I see) but [----] off!

UtopianFuture tried to brush this fellow off as a hater, and did try to turn subSTRATA into the joke of the thread as the latter escalated his angry accusations instead of backing down when rebutted, but that "hater" was merely a more radical variant of the disgruntled populists in his own community. Indeed they were old-style economic populists, who were openly demanding a retroactive change in the terms of the social contract.

He did try; he even tried to spin the more aggressive demanders for retroactive change as haters who secretly wanted NEM to fail. But, as was discovered by so many other economic populists waving around the red-cape word "FAIR," UtopianFuture found out that the bulls in his arena were mightily insistent. His further attempts at a compromise – in what direction, I need hardly spell out – occasionally drifted into confusion, obliging him to spell out what was okay and what wasn't. In the midst of this turmoil, he tried to keep NEM on track by continuing to post promotion suggestions. He also kept his hand in the Nxt thread, still loyal but becoming more detached. That's where he was as of 10:13 AM Greenwich Mean time, January 30th 2014, when he officially declared that the first application thread would be henceforth closed and the second would be self-moderated. At that time, he was still clinging to his earlier no-retroactive-changes decision.

By February 2nd, he said he was hunting down "fraudsters,": he defined "fraudsters" as people who used someone else's transaction ID for the stake fee. He was not only within the bounds of his previously-announced rule at this point, but he was also on the right side of the ancient law of contracts. Falsely claiming that someone else's payment was one's own is in fact plain fraud.

These fraudsters, he spotted by finding duplicate transaction IDs buried in the prior applications. Despite he using the common-sensical rule of "first person to send the id = legitimate", he soon faced more complaints and more headaches. He did cover his bases by saying that proving one had control of one's Bitcoin or Nxt account by sending a tiny amount (with an attached signed message in Bitcoin's case) would trump this rule of thumb.

Next, the sweep expanded to getting rid of duplicate-account applications for more than one stake. Again, this did conform to his original rule that specified only one stake per Bitcointalk account. At this point, it can't be said that he had bent from his original terms; he was just enforcing them. But as the more populist of UtopianFuture's community watched him doing his clean-up of the stakeholder list, they saw a leader who was indeed bowing down to the demands of the "community."

In the midst of his cleanup, the tech-driven fanboi side of the New Economy Movement continued as well. They happily pointed out how NEM's wallets could be more user-friendly than the then-extant Nxt clients. They also had fun in February looking over and commenting on the proliferating candidate images for the NEM logo, plus discussing promotion and evangelizing methods, the best target audiences, and the NEM Website.

Gamely, if more dutifully, UtopianFuture continued to hold up his end of the log in the Nxt part of the woods as January turned into February.

But it was really only a matter of time before the leader of the "No Envy Movement" bowed to the demand of (the louder parts of) his community and said that he would be retroactively voiding the stakes of sockpuppets. By February 6th, he was talking about "apply[ing] the ‘unfairly accumulation' clause and refund the money if we have solid evidences." At this point, NEM elder patmast3r started applying a primitive, hand-done taint analysis to spot people using proxy Bitcoin accounts to get more than one share. 

Although UtopianFuture still held fast in words to his original word, he did authorize full taint analysis later. But his original rule, made in an earlier, more innocent time for his "New Economy Movement," was on the way to crumbling – as became more and more evident when the presale fundraising came to a close on February 17th.

"I still find it ironic that a coin that is trying to not be about Envy has the most envy evident in this forum before it even launches..." – hyunsookmom, February 6th.

Thirteen days later, staunch criticism from the above-mentioned "Super interested!" 2Kewl4Skool would boil over into Bitcointalk's answer to a town-meeting show trial… ESR

Daniel M. Ryan is a long-time contributor to Enter Stage Right and has returned to the fold. © 2014 Daniel M. Ryan.

 

 

Home


 

Home

Site Map

E-mail ESR

 

 


© 1996-2014, Enter Stage Right and/or its creators. All rights reserved.