The Beat

Welcome to The Beat, Decential’s weekly breakdown of the music-web3 byway.

Like most things in web3, the music space moves at breakneck speeds, issuing regular bouts of hope, cringe and FOMO. That combination of qualities blur the essence of the movement – the enduring solutions to legacy industry problems and the people building them. Let’s focus on the essence; the rest, as Alex Ross wrote, is noise.

EthCC

This week I’m reporting from the Ethereum Community Conference (EthCC). It’s my third year here, but first one in Brussels (the usual host city, Paris, is gearing up for the Olympics).

The conference is taking place in The Square, an events space whose foyers are strewn with art. On a first-floor wall is an original fresco by Belgian surrealist, René Magritte. The piece, titled “The Mysterious Barricades” – which he also rendered as a commissioned work for private collection (it sold for more than £5 million in 2010) – features leafy trees and chess pieces standing guard next to a warmly-lit home. Pieces by other Belgian artists can be found throughout the building.

So far, EthCC’s buzzwords have been “real world assets” (aka actual blockchain utility) and “memecoins” – echoing Internet chatter over the past few months, where the latter has been particularly present.

Memecoins – also known as “scenecoins” and “culture coins” – purport to be a kind of cultural evolution of the shitcoin, “a cryptocurrency with little to no value or no immediate, discernible purpose.”

“Memecoins have clear [product market fit], have broken out into public consciousness, and are onboarding waves of new people,” wrote Cheryl Douglass in a Seed Club newsletter in May.

But as popular as they are, we should ask: are they onboarding people for the right reasons? Do these coins “embody the beliefs of real world communities that have shared values,” as venture capitalist (VC) Andrew Kang is quoted in a Cointelegraph piece?

That’s difficult to believe when the “real world communities” the piece mentions are “embodied” by tokens called BODEN and TREMP – and contextualized like this:

Of the whole memecoin ordeal, my first impression was pretty much:

I don’t not feel that way today, but as always, there’s nuance we should consider. As James Beck, Marketing Director at Avara, said in his talk yesterday at EthCC: “Tokens spawn communities of supporters who define their politics in relation to each other and their shared cultural signifiers.” That’s powerful, in theory. So let’s explore: could these coins come to “embody the beliefs of real world communities that have shared values?” And, as Beck asked to preface his talk: “Do we still share values?”

The Carnivore Chain

Speaking at the EthCC side event, “afk” (away from keyboard), Ethereum Founder Vitalik Buterin said, “The case for pessimism [regarding memecoins] is overstated. The people interested in the memecoin casino will join and the people that aren't will reject it. These are the knockdown effects for Ethereum.”

Buterin described the value systems of the blockchain as self-selecting. “If Ethereum has 3.9 percent carnivores and Bitcoin has 4.1 percent carnivores, which are you going to choose?” he said. “You can say it's a piece of neutral code – it's math, but if you're a carnivore we all know which one you'll go to.”

In an end-of-2023 treatise titled “Make Ethereum Cypherpunk Again,” Buterin observed that “significant parts of the non-blockchain decentralization community see the crypto world as a distraction, and not as a kindred spirit and a powerful ally.”

The main culprit, he wrote, is transaction fees. “When transaction fees go to over $100, as they have during the peak of the bull markets, there is exactly one audience that remains willing to play: degen gamblers,” Buterin said. “When they are the largest group using the chain on a large scale, this adjusts the public perception and the crypto space's internal culture.”

Ostensibly, memecoins capture and demonstrate the strength of a meme’s shared value, but to what end? What does holding a token actually say about your relationship with other people who hold that token? Especially when liquid tokens are tied to social interaction, how can one differentiate “real” shared value and speculative value?

“[Memecoins] aren’t good at retaining users because as soon as the price goes down, people drop the token,” Beck said during his talk.

Still, broadly speaking, crypto builders are using “degen as the hook,” Buterin said at afk, riffing with fireside partner, Paul Dylan-Ennis, a web3 thought leader, author and assistant professor at University College Dublin.

The hope, I guess, is that degen brings people into web3 and then they convert to the cypherpunk value system, but is that likely to happen? And “if not degen,” Buterin wondered, “what should be the hook?”

Money Toys

It's probably wishful thinking, sadly, to think the hook can be ‘redirecting platform incentives toward the creation of public good.’ But at what point does the casino become an irreversible public perception? As Buterin suggests, lowering transaction fees will help, but enough to upend crypto’s long sustained degen narrative?

“If we don't give people anything to do besides speculate on which tokens will moon, it's our fault not theirs,” Niran Babalola, the founder of the on-chain donation matching fund Panvala, commented in response to Palmer’s above tweet. Palmer disagreed, responding that “everyone is responsible for their own choices.”

Sure, but how can we help people make better choices? Because as Dylan-Ennis responded to Buterin’s ‘hook’ question, invoking media theorist Marshall McLuhan: “the medium is the message.”

And if the only medium in web3 is money, people are going to keep making money toys, like the Crate app, where you can:

1. Create a song with AI
2. Launch an ERC-20 token
3. Trade token immediately via bonding curve

On Crate, every song is a memecoin and the only information on a song page is trade data. Human-made music is deprioritized and decontextualized (again). Is that bad? Isn’t that just more of the distraction that keeps crypto from being perceived as that “kindred spirit” and “powerful ally?” Yes, but when that’s the behavior people see in the space, we can understand why people keep building for it.

At a Decentralized Identity talk in a “Blockchain for Good” EthCC side event, an audience member reminded us that, “as digital citizens we’re still very young, childish and immature.”  

It’s taken millennia for humans to build decent civilizations in the physical world – to temper the land grabs and greed of colonizers and imperial actors and inch toward some sense of equitable society. Now we’re reckoning with that process in digital spaces. Some are planting flags, some are trying to figure out how to civilize the Internet, and most are just sitting at the casino. The result is that our prevailing “shared value” is greed.

Memecoins can be scenecoins can be culture coins can be shitcoins. By changing the name, maybe we’re embedding context that’s more likely to encourage other types of shared value. Indeed, Ethereum Community Conference invokes a more communal spirit than other crypto conferences. Names set the tone – but they can also trick us into thinking shit is culture.

EthCC 2024 has felt more connective than in past years. It’s felt tied to more shared values than just financial gain. And part of that feeling, I think, has come from the building itself. Where walls could be blank, there is art – leafy greens and chess pieces, masterpieces of cultural import.

Still, there stand barricades between us and a truly viable future for web3 – some mysterious, others less so. We do share values, and when we think about how we demonstrate the connections those shared values represent, we should remember: “we shape our tools and thereafter our tools shape us.”

That quote is sometimes accredited to McLuhan, other times to media theorist John Culkin. And sometimes it’s attributed to 1943 and Winston Churchill, when he told the House of Commons, “We shape our buildings and afterwards our buildings shape us.”

Coda

On Sunday I went to SheFi Summit, a one-day “feminine-first experiential event” that preceded EthCC’s official kickoff. SheFi was created – founder Maggie Love said – because “despite the permissionless nature of blockchain, there’s a significant cultural, educational, and interest gap.” According to a 2023 study, only 13 percent of founding teams include at least one woman.

About 30 women spoke throughout the day, covering everything from regulation to decentralized AI, on-chain social to the elusive real-world use cases for blockchain.

No one, however, mentioned memecoins or degen. The focal points were self-care and ways in which blockchain can drive impact – mostly folks serving the underserved (especially the unbanked).

Amidst the crypto bro pathology, SheFi is a breath of fresh air. And the SheFi Summit was one of the most grounded, pragmatic and inspiring crypto events I’ve attended. Here, certainly, is a real-world community united by shared values.

In one SheFi fireside with Christina Beltramini, the head of growth at Lens Protocol, the artist Latashá said, “It’s really nice to have a new world and new soil where I can garden the way I want to garden.”

Maybe that should be the hook.

Now go outside and listen to music — it’s a beautiful day.

My name is MacEagon Voyce. For more music and less noise, consider subscribing to The Beat. And if you already do, consider sharing with a friend. Thanks for being here.