Cryptocurrency and the Great Unbundling

We’re in the early stages of another round of massive cultural upheaval that’ll be even bigger than the Web, social media, and the smartphone.

Uniswap is a cryptocurrency exchange, like Coinbase. Right now it has billions of dollars (USD) in assets flowing through it, a number that’s growing.

But here’s what’s totally nuts: Uniswap doesn’t actually exist in any technological (servers, accounts, log-ins, etc.) or legal (LLC, S-corp) form that we’re used to. Rather, Uniswap is a decentralized protocol, and the governing body of that protocol is a decentralized autonomous organization (DAO) on the Ethereum blockchain.

I won’t unpack what a DAO is here — it’s essentially a bag of smart contracts on the blockchain that let members (i.e., token holders) reach consensus and act collectively without knowing or caring about each other’s real-world identities. What the Uniswap DAO enables is this scenario: if I’m a pseudonymous individual with a mobile phone and a crypto wallet (just a secure app that holds a set of secret numbers, or private keys, behind a password) offering, say, five stokescoins in exchange for one bitcoin, and you’re a rando somewhere who has one bitcoin to trade for my five stokescoins, then you and I can find each other and swap this money, and there is literally nothing anyone anywhere can do about it.

There is no user account for either of us, and there’s no governing body that can kick either of us off the service.

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