Where Does Crypto Go From Here?

Gideon Lichfield: You said just now that what Sam Bankman-Fried did was allegedly illegal. Is there a world in which it wasn’t illegal?

Michael Casey: I think we all—I know. I’m trying to be a good journalist here, Gideon. I’m just trying to like—

Gideon Lichfield: Just because he hasn’t been found guilty yet.

Michael Casey: Innocent before proven guilty, yes, but I think he did.

Gideon Lichfield: Fair enough.

Michael Casey: That’s it.

Gideon Lichfield: Alright. So, let’s go back to something else that you said, ’cause I started talking about how the SEC is also suing Binance over allegedly misusing its customer’s funds, or mismanaging them, and how that was similar to what FTX did, and you jumped in and said, well, also a whole bunch of banks, also large parts of the truth about the financial system.

Michael Casey: Which sounds like whataboutism maybe, yeah? But—

Gideon Lichfield: It sounds a little bit like whataboutism, but I think more interestingly than that, my question is this, some of the promise—I think, well, the promise of crypto was that it was gonna be decentralized, was that it wasn’t gonna be captured by institutions or by individuals, and yet that is the fact of what has happened, because it turns out that even when you run a decentralized system, you need some things like exchanges or you need trading spaces for NFTs, for example, and those end up being dominated by, on the whole, a handful of parties. So I feel like the problem of corruption or mismanagement that we’ve seen in the crypto industry is to a large extent for that reason. In other words, it doesn’t seem like it is actually immune from the same kind of challenges that face the financial system. So how would you get past that?

Michael Casey: Well, I think that’s a fair criticism, and I think that that’s on crypto, that’s on this industry for defaulting to the simple solutions.

Gideon Lichfield: Is it on crypto, or is it just on human beings?

Michael Casey: I think it’s on human beings as well. I think actually it’s very difficult to build the decentralized system. They are inherently complicated, and it’s very, very difficult to do it by snapping your fingers, but bitcoin achieved it. There is nobody in charge of bitcoin and it runs this way day in, day out.