Wintermute CEO: Where is the future of encryption

Original link:https://x.com/vgenygaevoy/status/2024945812749340941?s=46

Author:what's wrong with you

Compiled by Ken, Challenger

 

THIS ARTICLE I'VE BEEN THINKING ABOUT. MY POINT OF VIEW HAS BEEN SWAYING: IS THE CODE PUNK WORKING? IS FREE WILL VIABLE? OR, ON A MACRO LEVEL, IS IT POSSIBLE TO ENCRYPT THE CURRENCY ITSELF? AND HERE'S WHAT I'M GOING TO DO. I DON'T THINK THESE IDEAS ARE NECESSARILY HIGHLY CORRELATED WITH PRICE TRENDS, NOR DO I THINK MY THINKERS ARE CAPABLE OF INFLUENCING THE MARKET. SO IF YOU'RE READING THIS TO GET INSIDER INFORMATION, IT'S A GOOD THING TO CLOSE THE PAGE. ON THE CONTRARY, IT IS MORE LIKE A DECLARATION, AN ARTICLE THAT TALKS ABOUT “WHY ARE WE HERE” (SUCH ARTICLES HAVE RECENTLY BEEN SCARCE). “I” IN THE TITLE MEANS (POSSIBLY) THERE WILL BE FOLLOW-UP, WHICH MAY CONCERN HOW I CAN HOLD THESE VIEWS WHILE OPERATING A HIGHLY CENTRALIZED ENTITY COMPANY。

The Golden Way

For most of my life, the dunes have been the top three books in my mind. This may have changed in recent years (for example, the Civilization series is now ranked higher), but it still holds a very precious place in my mind, as it shapes the world view when I was about 20。

People tend to focus only on the first three parts of the series, but for me, the fourth is the work that really profoundly influences my mind. It has influenced my view of progress, the benefits of diversity (at a level other than “political correctness”) and “how things should be”. I'm sure I'm going to be a little more dramatic here. Excuse me. But before that, the whole core of the whole set of ideas -- the only viable way for human survival -- was expansion and diversification. The Golden Way is a thousands of-year-old scheme designed to impose an extreme degree of stability on mankind so that when it disappears, humanity will hate it so much that, from the cell level, it will hate any form of centralization. In other words, it is intended to:

“Give humanity a lesson: so-called safe haven, no matter how long it lasts, is tantamount to total death.”

It is our nature to pursue stability, organize things, confront chaos and entropy. The creation of empires, whether State-based or business-based, is also our nature. We know that all empires will fall and all businesses will perish, but we continue to try, every time, to build a larger and stronger empire. However, the larger our empire, the greater its catastrophic collapse. Worse still, extreme imperial construction may even push humanity to the brink of extinction, either because it is too concentrated to resist external events or because it abandons the existence of society in the process of internal “evolution”. Thus, throughout history, we continue to circulate between chaos, self-organization, empire and collapse. For me, the key message of the concept of the Golden Way is that we need to embrace diversity at the integration stage and reject empires, no matter how tempting the stability they offer (and the prosperity of promises)。

There is a great deal of “asylum security” in existing countries. There is also a great deal of “asylum security” in the existing business/financial machinery. For me, both are slowly pushing us towards an inevitable collapse. For the sake of clarity — this is not a statement against capitalism and/or progress. On the contrary, in this system, capitalism is becoming less and more and more and more and more odious and gloomless. In sum, the future of the Leviathan is as follows:

• Anarchical capitalismBusiness wins, government loses. Whether it's Tahir-Ashple in Neuro Rover, Pizza in Avalanche, or Viland-Tung Valley in Alien, the outlook is rather bleak for anyone who is not a senior screw in this machine。

• NationalismThe nation State controls everything and divides the world. It remains to be seen whether we will enter the 1984 world or whether we will find something more acceptable。

• FascismThe evil alliance between business and government. It's like the Milky Way era in Star Wars — the insurgency is almost inevitable. As to which country might go this way, it was left to the reader to speculate。

So, what's on the other side of all this? It does not provide safe haven, but urges us to focus primarily on individual sovereignty and independence. It seeks to transcend borders and completely ignore closed financial systems. It views “insecurity” as a characteristic rather than a defect. I'm glad you asked that question. The word you're looking for is encrypted currency。

There's a long way ahead

I've been in this business for almost nine years, and I've never seen anything as lost as I am. On the face of it, we seem to have received most of what we wanted: “institutional adoption” and the practical application of technology. But there's always something missing, not just price, but its “soul”, the question of what we're doing. At the same time, the world is growing rapidly, and the cooler field of artificial intelligence has emerged. We have lost our way。

Of course, not everyone is. Some see the rise of the currency as a victory. Some (and in my view too early) are celebrating (to some extent) the centralization of the permanent contract exchange over the traditional financial and centralization of the “dimonos”. Others are looking at how to build their empires at the crossroads of decentralised finance and traditional finance. We saw the emergence of the “business chain”, which once again became great. So yes, some people are excited, but I'm not one of them, although Wintermute will benefit from this integration。

I am not excited because I see several different paths ahead, only one of which is feasible and worth pursuing:

1. Traditional finance devours encrypted currency: STABLE CURRENCY IS WIDELY USED. BUSINESS CHAIN APPLIES KYC CERTIFICATION. GO TO THE CENTRALIZED EXCHANGE FOR KYC CERTIFICATION. THE FINANCIAL MACHINERY OPERATES MORE EFFICIENTLY AND THERE ARE FEWER INTERMEDIARIES. BITCOIN IS DIGITAL GOLD, MOST OF WHICH BELONGS TO SOVEREIGN GOVERNMENTS, CORPORATE VAULTS AND ETFS。Or the global use of the central bank’s digital currency, thus achieving full control over our privacy。This technology works very well, but obviouslyWe have a good chance of losingI don't know。

2. The government surrendered to the block chain:EVERYTHING RUNS ON UNLICENSED BOOKS, WITH COMPLETE DISREGARD FOR THE KYC/AML MECHANISM. ENCRYPTED CURRENCY IS TAXED ONLY WHEN CONVERTED INTO FRENCH CURRENCY. THE CURRENCY WAS VALUED AT SEVERAL TRILLIONS OF DOLLARS. THIS IS A FREE AND BEAUTIFUL WORLD. BUT THIS IS ALSO A VERY ILLUSORY WORLD。We won, but the odds are extremely lowI don't know。

3. Uneasy coexistenceWe build something parallel to the existing system, completely independent of it. You can be in both, and the government can't touch it because it's designed to be isolated. We won and we won completely. And this..It depends entirely on us。

I wish I could convey the feeling that I do not think that option one is attractive, but that it is simply making the existing machinery (which one of the three great beasts will win) more efficient。

I know that some people think that the second scenario is possible, but it's simply a dream. Governments do not give up sovereignty, just as businesses do not give up monopoly status easily. Casinos cannot operate freely on the Solana platform. The U.S. Commodity Futures Trading Commission will not easily give up Hyperliquid's uncertified and unregulated status (even if the current regulator gives up, the next or the next). Furthermore, I would like to remind you that any central issuer of a stable currency can freeze your currency by court order. The only possibility of this is a massive socio-economic collapse, which I do not want to see as the father of three children (and the employer of over 100 employees)。

THIS LEADS TO A THIRD SCENARIO. YOU CAN CALL IT A META-COSM, A CYBER-STATE, A DECENTRIZED AUTONOMOUS ORGANIZATION (DAO) OR A CULTURAL TRIBE. THEIR COMMON DENOMINATOR IS THAT THEY EXIST INDEPENDENTLY AND OFTEN IN CONFLICT WITH THE POLITICAL AND FINANCIAL SYSTEMS OF THE “REAL WORLD”。

Enter Matrix

Our problem is that most people have never learned this lesson “with heart”. Our people in the West, in particular, have become accustomed to progress and have become more and more convenient, without ever actually experiencing the ills of losing sovereignty. Ironically, it was only in 2022-2024 that we felt the worst of this: on the one hand, we suffered from regulatory shocks from the United States Securities and Exchange Commission and the Commodity Futures Exchange Commission; on the other, we almost watched a central entity (FTX/Alameda + VC group) buy most of the encrypted currency. However, we have learned completely wrong lessons. Instead of redoubling our efforts for freedom, we thought that we could win by putting the right people in the right place。

At the same time, we have spent several years complaining about the user experience of encrypted money, about the inaccessibility of bitcoin as a medium of trade, about the proliferation of hacker attacks, and so on. What if we're all wrong? What if this inconvenience is the price of the culture that we need to actively embrace and to enjoy sovereignty? I'm not saying we should put MetaMask at the top of innovation. And I'm not saying that we should all write notes on metal cylinders. I mean, we should try to improve the user experience, not for the 50 per cent of the world that doesn't need it, but for the 50 per cent of the sovereign individuals who really need it -- whether in developing countries that are facing the constant erosion of democracy and full government control, or in developed countries that are becoming more like China and Russia, which have very stupid anti-privacy laws。

OUR GOAL SHOULD NOT BE TO CONFRONT “REGULATION” OR “GOVERNMENT”. OUR GOAL SHOULD BE TO CREATE SOMETHING BEYOND CONTROL. THE KEY IS NOT TO RELY ON BOTTLENECKS: ACCESS TO FRENCH CURRENCY, APP STORES, DOMAIN NAME SYSTEM HOSTING, CENTRALIZED SORTERS, SOCIAL MEDIA PLATFORMS AND, OF COURSE, CENTRALIZED STABILIZERS (THE KIND THAT CAN BE FROZEN). NOTHING WE BUILD SHOULD BE SIMPLY SHUT DOWN BY COURT ORDER OR BY CORPORATE BUREAUCRACY. THE TAX AUTHORITIES SHOULDN'T WANT OUR STUPID COINS THAT DON'T COMPLY WITH THE MICA REGULATIONS (UNLESS WE DO). THE ULTIMATE GOAL IS SIMPLE — WE SHOULD CREATE A SYSTEM THAT ALLOWS ORDINARY PEOPLE TO EXIST WITHOUT ANYONE'S PERMISSION。

This specifically means:

• Embracing does not require a permit, a sovereign agreement and rejects a black-boxed sub-chain solution。

• It is in the right direction to go to the central self-government organizations (DAOs)I'M ACTUALLY REFERRING TO THE FAILED DAOS -- THOSE WITHOUT A CENTRALIZED ENTITY THAT ACTUALLY CONTROLS THE THEATRE THROUGH THE FALSE GOVERNANCEI don't know. We have never really built a real community, but instead have focused on how to stimulate the publication of trash reviews. We need to continue our efforts。

• The Institute either does not rely on a centralized technology warehouse or is able to dynamically switch it when some of the external links are interrupted. This applies to infrastructure (e.g. cloud, LLMs), social coordination and, of course, stabilization currency (the next point will be detailed)。

• Let the algorithm stabilize the coin again. Our mistake was to be too obsessed with the Ponzi scheme. DAI and UST are not wrong about adding USDC to DAI and adding completely unsustainable returns to UST. DAI cannot reach Tether's size with ETH's support alone, which is perfectly reasonable — we need to build a parallel economic system, and we have never really tried it. Ideally — we can really trade in encrypted currency between ourselves, although I think it will take some time to achieve。

• Privacy protection must be activated. As long as this can be achieved, what tools are used is not important。

Disperse

The Dune Emperor ended with a “dispersion” — humans fled into the void after the fall of the Emperor. We should have experienced similar dislocations after 2022, after learning lessons, but it is not too late。

We are not always able to choose the world we are in today. Some are trapped in countries where there is little way out, while others are trapped in self-imposed obligations. My somewhat pessimistic prediction is that we will have more and more reasons to flee in the coming years. The Leviathan beast will grow, conquer and oppress us. Even with such a “better” parallel encrypted world, we cannot (at present) be fully integrated. But we can at least (re)start building a safe haven for others to flee, while allowing the real world to coexist with the encrypted world。

The only thing worth building is a way out. Even if the encrypted currency is no longer popular (which is almost inevitable), the system can withstand the external test. But more importantly, it will give meaning to what we have done and what we have built。

Most of us will choose to live with this giant. There is no harm in being driven by responsibility, comfort, money, or just another meaning. Those who stay will build exits and perhaps recover what we lost。