Put Me In Self-Custody đ
In early 2023, I wrote an article on self-custody for Issue 01 of The Boys Club Zine. The zine (and this article) were published on March 10th, 2023, two days after the collapse of Silvergate Bank, and the same day that Silicon Valley Bank was seized by regulators, triggering a multi-billion dollar bank run on Signature Bank.
Read the article as originally published in the zine, where you can also mint a special self-custody affirmation NFT.
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Put Me In Self-Custody
As published in the Boys Club Zine, March 10th, 2023.
What do Britney Spears and web3 have in common? A shared desire for sovereignty: the state of being independent, autonomous, or self-governing.
We all remember #FreeBritney â the movement that gripped every 90s baby during 2020 and 2021. Locked in our houses, we voraciously followed the media coverage of Britneyâs legal battle for the power to make decisions about her own body, life and career.
But when it comes to cryptocurrency, sovereignty is key to understanding the power and potential of this new asset class â and further to that, the promise of web3. Enabled by blockchain technology, cryptocurrency gives people the ability to transact with a level of autonomy, freedom, and privacy that was never before possible.
We often hear the word âsovereigntyâ in the context of nation-statesâ rights to independence and self-governance. But for those of us scrolling through #cryptotwitter, the term âself-sovereigntyâ appears frequently in reference to what web3 and cryptocurrency have to offer. So, what does it mean, exactly?
âIn web3, being âself-sovereignâ is the same as being âself-custodiedâ â meaning you are the keeper of the keys to where your digital assets (like cryptocurrencies and NFTs) are stored on the blockchain.
The idea of being your own bank and the sole owner of your value is foundational to crypto and blockchain. Crypto is decentralized, permissionless money. Itâs about giving the power to store, save, and exchange money back to usâ the peopleâ without the need for centralized gatekeepers to manage your worth on your behalf.
#FREEME
The vision for web3, or âthe new internetâ, is that users become owners. Powered by blockchain technology, smart contracts, and digital assets like cryptocurrency, we can move away from the extractive and exploitative form that the internet currently takes, where giants like Google and Meta control our sign-ins, lock our data into their closed platforms, and make money selling our content and information back to us. Instead, in web3 we can be compensated for our contributions and creations, and our data is no longer walled into closed systems but can travel freely with us to whatever platform we choose.
Anyone, anywhere in the world with an internet connection can benefit equally from this new decentralized approach to a digital internet economy. In order to achieve this promising new future, we need to ensure that our decentralized networks are strong, and we cannot rely on custodial, centralized platforms to store our value and become the pillars holding up this nascent digital economy.
Weâve seen what happens when we do: exchanges like Celsius, Blockfi and FTX collapsed into insolvency in 2022, wiping out billions of dollars in value for millions of users. Why? Because criminals and bad actors will always try to line their pockets with your money if you let them, regardless of industry or type of money. The solution? Donât give them access to your value in the first place!
The blockchain doesnât discriminate. It doesnât care who you are, where youâre from, or what you did. The same principles that allow financial freedom for the underbanked around the world also make it a ripe playing field for the shady-AF-nefarious-types. We see you, SBF. Generally, shady people think that rules donât apply to them. So what are the implications when the rules are in codeâ literally encodedâ into the systems they are trying
to manipulate? This is where self-custody and trustlessness of blockchain come into play.
SHOW ME THE MONEY
Throughout history, and especially in the modern era, the framework of a state government controlling how we as human beings organize ourselves in society has been the de facto way of existing. This includes banking institutions running everything from the global economy to your checking account.
To many, the idea of taking singular responsibility for oneâs own finances and data, without a bank or third party backing things up for you, can be intimidating. Weâre accustomed to relying on banks to secure our assets, and on monolithic platforms storing our data. But this doesnât actually work, and if you need a reminder as to why, just think back to the 2008 financial crisis where Wall Street totally shit the bed, or fire up THE SOCIAL DILEMMA, a documentary uncovering how the algorithms designed by big tech control, manipulate, and monetize us.
When the idea of currency in its modern form was introduced, we were required to place our trust in something intangible, but that we were told had value. We were assured that this currency would be backed by the full faith and credit of the government, and so we trusted the government to keep our money safe and to uphold its value. And whatâs happened since? Look no further than modern US history to see how itâs all gone wrong: in 1933 the US government seized its citizensâ gold; in 1973 Nixon took the dollar off the gold standard, moving us to a fiat system; in 2008 the aforementioned bed-shitting of Wall Street pushed us into a major financial crisis and recession; and in 2020 the government printed $3 trillion dollars out of thin air to prop up the economy, which we are now paying for in the form of inflation.
SATOSHI, SAVE US!
But from the ashes of the financial crisis rose a phoenix: in 2008, Satoshi Nakomoto created BITCOIN, a decentralized, blockchain-powered cryptocurrency with a finite supply, that was not controlled by one or even several centralized entities. This opened up an entirely new way of organizing ourselves â a way forward that is decentralized and trustless.
We are no longer reliant on any third party to ensure the accuracy of our transactions. This is an incredibly liberating truth and it completely revolutionizes what the future will look like for participants in the new digital economy.
In a decentralized system, there is no central authority. Instead, power is distributed among a network of individuals. The most important thing to understand is that this signifies a shift in power from the central authority to the people. Whoever has the money, has the power, and with blockchain, power is not concentrated in the hands of a few individuals but instead shared among many.
Blockchain provides us with a trustless system, which in âregular speakâ means that transactions can be processed programmatically with code and consensus can be reached without consenting parties needing to know or trust one another. In other words, we are no longer reliant on any third party to ensure the accuracy of our transactions. This is an incredibly liberating truth and it completely revolutionizes what the future will look like for participants in the new digital economy.
LEVEL-SETTING
Itâs easy to get really amped up about the fact that we are standing on the precipice of a new experiment in how human beings organize and exist. It may not happen today, tomorrow, or even in 20 years, but itâs incredibly exciting to be here at the beginning of the shift from trust-bound paper money, to the trustless blockchain powered digital economy. Whatâs important now, is to remember that you will decide what that looks like: will it be a âmore of the sameâ custodied existence where governments, big corporations and banks control your identity, finances and future? Or will you reject this model, take back your power as an individual, and move fully into a model of self-custody?
To me, the choice is easy, and I know what side of the mark I stand on. Sorry Daddy, but Iâm no longer a Slave 4 U.
