Love it or hate it, Crypto’s vibe shift is now imminent

Last month, cultural critic Alison P. Davis released an article at The cut titled “A Vibe Shift is Coming. Will any of us survive?” The “vibe shift” Davis was referring to had nothing to do with crypto. She referred to a sea change in pop culture and social trends, particularly given GenZ’s continued rise to trendsetters and cultural relevance. Still, her positioning caught my eye because she aptly put the finger on something crucial that I also felt, especially in relation to crypto. The paradigm shift toward the next cultural moment—whatever it may be—is palpable, if not tangible. We can’t see it exactly, but we know it’s in the room. The specific conditions haven’t changed yet, but the mood has.

In the days following its release, “Vibe Shift” drew Twitter’s attention and, in many cases, ridicule. As silly as the term might be, it captures something real and similar happening in the crypto space. As ridiculous as it may sound at first, there is a mood shift taking place in crypto.

I like the term “vibe shift” because that’s what it’s all about: a feeling, a hunch, a mood, a tone, a vibe. In its brief history, crypto’s mood shifts have followed shifts in the technology itself. Crypto’s initial wild west, anything-goes optimism stemmed from bitcoins (Bitcoin) transition from a peer-to-peer (P2P) payment solution to a store of value, then got even more maniacal with the launch of Ethereum, which demonstrated the potential of smart contracts. This half-mad optimism became more serious and factual as decentralized finance (DeFi) based on legitimate Level 2 networks expanded. The development of non-fungible tokens (NFTs) brought artists and musicians on board, not the other way around.

Related: In Defense Of Crypto: Why Digital Currencies Deserve A Better Rep

That’s neither good nor bad, it’s just a fact. The technology determines the discourse in DeFi and crypto, so it also dictates the culture. That “that is no longer the case” is an argument that could only be made after the actual technology has reached a certain level of maturity and public legitimacy – which has happened with crypto and DeFi. A crypto “vibe shift” is a necessarily new concept, and it’s happening in a particularly interesting way.

In other words, how we talk about crypto is changing, but not in response to the technology itself. People are talking as if they have more influence in the game, and not just because they have their own capital invested in it. People are thinking bigger about crypto’s role within the world and not just in self-serving terms related to capitalizing on mainstream adoption.

From profit to politics

May I say we have become political? I first noticed it when Canadian truckers protested vaccination regulations. This topic lit up the crypto space and wasn’t entirely about agreeing or disagreeing with the convoy’s actual targets. In the face of a government freeze on traditional assets and the ban on standard fundraising platforms like GoFundMe, the Truckers turned to bitcoin and raised $900,000 in just a few days. Subsequent attempts by the Canadian government to freeze crypto assets linked to the convoy have met with only partial success. After an Ontario Superior Court judge issued an injunction freezing millions of dollars in crypto for the convoy, the crypto community responded with a mixture of protest and confusion. Multisignature wallet nunchuck had to reply publicly that, politics aside, they could not provide the subpoenaed information even if they wanted to: “We are a software vendor, not a custodian financial intermediary,” and one that still has no ability to confiscate its users’ assets.

Unease about truckers’ political positions aside, the crackdown has nonetheless broken some shackles in our space. The idea (which has become a reality) that a federal government could confiscate crypto assets with a court order and for at least partly ideological reasons goes against everything this community prides itself on. The Russian invasion of Ukraine only reinforced this feeling.

Related: Bitcoin on the Barricades: Ottawa, Ukraine and Beyond

The Cryptonomics of War

In the early days of the Russian invasion, some interesting things happened. The Ukrainian government requested Donations in Bitcoin early on (which inevitably led to scammers attempting to clone the account for their own benefit), then prompted crypto exchanges to freeze Russian accounts. Transforming crypto into a safe financial haven and reliable store of value for a country at war was a game changer whose impact we will feel for years to come. Many of these exchanges declined, who claimed it would unfairly punish ordinary Russian citizens for the actions of their leaders. Some of the biggest names in the industry seemed to side with neutrality, but not without reservation. Vitalik Buterin tweeted particularly vague about the neutrality of crypto.

Additionally, a land war in Europe has predictably caused many of us to lose taste for the latest quirky NFT drop, at least for now – there are more serious things to talk about. And crypto actually talks about it. That’s the mood shift, and it’s not happening in response to technology. It is happening in response to the real world and changing the contours of the crypto world. It leads to a moral reckoning that sums up what crypto is meant to do and for whom it is intended. It’s about the price of neutrality and what exactly neutrality means.

Related: Every Bitcoin Helps: Crypto-Powered Aid to Ukraine

If crypto invaded the real world, the real world is now invading crypto. The short-sighted and unrealistic perspective that our critics accuse us of is fading. This shift in mood makes it so difficult to predict what comes next, especially now that we are suddenly involved in massive geopolitical operations. The conversation has changed because the rules of engagement have changed. Crypto is all fun and games and monkeys until someone starts a war. Or, for that matter, a convoy.

The end of history or the future or crypto?

I remain confident in the future of crypto and DeFi, but it’s going to be a complicated future. The Canadian trucker convoy and the war in Ukraine have become unexpected accounts with no easy answers and, in many cases, some very unsavory ones. Like most who are heavily involved in this space, I still believe that a large element of crypto’s hard and soft power is related to its bankless, decentralized status, removed from the traditional mechanics of global finance. But these things are never that simple.

The point of a mood shift is that what comes next is still obscure. We are just waking up to the power of crypto and the huge implications of a legitimate, censorship-resistant financial infrastructure. What that means for the future and where we go from here is uncertain, and we have more at stake than the cultural denizens of New York City, to whom the term was originally applied. Autonomous money that exists outside the control of traditional finance is untested in the context of geopolitical conflict and culture wars. Whatever happens next will change everything.

This article does not contain any investment advice or recommendation. Every investment and trading move involves risk and readers should do their own research when making a decision.

The views, thoughts, and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Dominik Schiener is co-founder of the Iota Foundation, a non-profit foundation based in Berlin. He oversees partnerships and the overall execution of the project vision. Iota is a distributed ledger technology for the Internet of Things and a cryptocurrency. He also won the largest blockchain hackathon in Shanghai. For the past two years he has focused on enabling machine economy through iota.