“Sofalarity”. This is my favorite word of the month/year (depending on what I read next).

I realized belatedly that my own exhaustion is precisely the state that this system needs me to exhibit in order to maintain its operation, and this is not my personal failure. I slumped on the bamboo sofa, posing in a way that would definitely lead to back pain, asking Alexa to brighten the lights. Because the content I just read began to feel somewhat uncomfortable and overly aimed at the individual.

Everyone knows the “singularity,” which is the theoretical node where AI surpasses human intelligence and everything will change forever. We haven't reached that point, but “sofalarity” is already present in this room with us.

At this node, convenience itself has become so absolute that leaving one platform feels almost as unrealistic as moving to another country where you might not find a bamboo sofa.

The ecosystem you choose to stay in seems completely devoid of drama or friction, offering convenience that can genuinely improve your life. But you can see friction anywhere else; that’s the reason we keep making the same choices. But is this really your own choice, or is the choice already made for you?

This book describes a phenomenon that I believe most of us know but cannot find the words to express. Staying on a platform that you are not even sure you like, that (comfortable) heaviness. The feeling of wanting to switch platforms is not impossible, but for some reason it leaves you feeling exhausted before you even start. The author borrowed a term from stoner culture: “couch lock”. The meaning of this term is self-evident.

As usual, my mind immediately drifts back to cryptocurrency. Can we actually build a product that is smooth enough to make people experience “couch lock”? Or have we already made that promise, tried, and failed miserably? Are we completely outside the comfortable consumer haven, or are we just stuck in its lower levels?

Look at how these applications leverage what psychologists call the “variable reward schedule” to keep us addicted. This is what makes gambling addictive - the slot machine effect, which is visible everywhere in cryptocurrency. Price volatility acts as one of the most powerful slot machines ever. Most positions do not change much. Occasionally, some assets will skyrocket tenfold. This unpredictability triggers intense compulsive checking behavior, just like swiping through Instagram notifications and TikTok videos.

The variable reward system of cryptocurrencies skips the platform entirely and directly pulls people towards price charts, where traders' dopamine accumulates. It lacks the habitual dependence on which large tech platforms profit. This probably explains why, after fifteen years, speculation remains the only consumer product that cryptocurrency can continuously provide.

Wu explained why platforms spend billions on things that seem unrelated to their core business. Google pays $17 billion for NFL broadcasting rights, or Amazon spends $11 billion on Thursday Night Football. Their goal is time. They want to control enough of your Sunday time so that your entire week naturally revolves around a company's interface.

Every hour you spend within an ecosystem on a platform is an hour not spent thinking about whether there are better options elsewhere.

For people in India, there are two options for watching “The Office”: Netflix and Amazon Prime. The perks offered by Amazon make it a decent choice, along with many privileges prepared for Prime users.

“If it’s simple, it wins,” Wu said.

Borderless currency, self-custody, and transparent systems are all good. But this pitch asks you to first convince others that something they think is not broken actually is broken. Most people don’t think about how to fix the correspondent banking system while they’re out walking.

The “convenience gap” of the internet is obvious to everyone. “You don’t need to drive to the post office anymore.” Okay, convinced.

This before-and-after comparison is obvious and immediate. The gap in cryptocurrency is just as real, but is almost completely invisible to ordinary people living within it. This inefficiency exists within institutions, settlement layers, within correspondent banking systems that most people never need to understand. “Replaced by blockchain” sounds completely like a foreign language to ordinary users.

The internet replaced those things that bother everyone. Driving to a travel agency to book a plane ticket is annoying. Renting a movie from a video store is annoying; if you go late, someone has already taken it. When the internet removed these barriers, people immediately felt the difference because it made their lives comfortable. Explaining these solutions to people is something they can accept.

Cryptocurrency is replacing things most people have never thought about. A regular person sending money to family abroad only knows it takes a few days and costs money. They likely don't know what a correspondent bank is. They don't care that their $200 remittance has to go through three or four intermediary banks before reaching the destination, each charging a fee. They only know that this money can, more or less, get there, and they will continue using it next month.

If you switch this entire system to blockchain technology, the experience for the sender is roughly the same. It may be faster. Fees may be lower. However, their lives won’t experience any visible change. They won’t have an ‘oh, I don’t have to do that anymore’ epiphany. That is the problem.

Adoption has always been a challenge faced by this industry, not by the users. As long as cryptocurrency still requires explanation to be understood, it will always belong to the realm of “nerds” no matter how good the technology is.

What else does cryptocurrency lack? The chapter on data needs to be viewed from a whole new perspective.

Google and Meta's total advertising revenue in 2024 reached $360 billion because they spent twenty years collecting every move of yours. Every scroll or prolonged stay on a post helps them build a machine that can predict your next move. Brands pay billions for this prediction. And we built this engine entirely for free from the moment we opened our first account.

Wu compares this to a poker game, where your opponent has watched every card you have played. They remember your bluffs and your worst calls. They are playing the game entirely within the rules, but they see through your thoughts. This advantage compounds over billions of independent hands, ultimately giving rise to massive corporate empires.

I pondered whether cryptocurrency has something similar. No, I’m not talking about prediction markets.

The entire blockchain of Bitcoin (including every transaction since 2009) is about 611 GB. Meta processes more data every few hours than that. Ethereum's on-chain data is richer, but it only captures financial behavior: wallet addresses, transaction amounts, and protocol interactions. It shows what someone did with the money but provides no insights into the “why”. It misses countless everyday small choices that would make behavioral predictions commercially valuable.

Each week, 900 million people use ChatGPT, sharing work documents, medical issues, their anxieties, and business strategies. This helps them. When they use it, they do not see the privacy trade-offs.

For everyday convenience, people often hand over their private search histories and location data to big tech companies. At this time, turning around and asking the same audience to suddenly care deeply about financial autonomy and transparent ledgers is too unrealistic. Some people do care. Some people care but are too busy with work. This pitch only appeals to those who have already been convinced. If you want to achieve mass adoption and create “everything apps,” this approach is ineffective for growth.

Wu disagrees with Shoshana Zuboff’s views on “surveillance capitalism.” She claims that platforms create Skinner boxes. They are like mini-games, enticing our brains to check them over and over by offering surprise rewards. He argues that widespread attention manipulation existed long before big data on the internet came along. At this point, I agree with him.

Goebbels didn’t need recommendation algorithms. Yes, the framework of “totalitarian control” is somewhat exaggerated.

Look at the variable rewards mechanisms. Just as we discussed at the beginning of the article, cryptocurrency has them too. The way prices constantly rise and fall is like a massive, thrilling surprise game. But that feeling of excitement has never locked you into a practical daily application.

The more you rely on a tool, the worse you become at doing that thing without it. When that tool is merely a calculator, that's not a big deal. But when that tool is infrastructure owned and controlled by others, things get complicated.

Cryptocurrency has been repeatedly creating this problem. Developers build on sequencers they cannot control. Protocols are dependent on liquidity providers who can leave at any time. Applications are attached to chains run by a few validators. Each layer feels like progress but not entirely. You've built something on someone else's foundation, and now you can't move an inch without their permission. Web2 is the same form. When AWS goes down, half the internet goes down with it.

Now we can return to look at the analogy with IBM. IBM dominated that era by building elite enterprise-level infrastructure and having application layers run on top of it, completely bypassing the battle for consumer “couch lock.”

The best outcome in the reality of cryptocurrency may look more like this, which we have only recently realized. Settlement rails, institutional clearing, cross-border infrastructure — nobody wants to rebuild from scratch.

This is a significant achievement, even if it is completely different from the dream of consumer-grade super applications.

In the latter half of the book, the content shifts from technology to revealing how the same corporate tricks dominate the healthcare and housing sectors. I find it important to mention this.

Welsh, Carson, Anderson and Stowe acquired anesthetic businesses in various cities because patients under anesthesia cannot shop around. Prices increased by 26% between 2012 and 2017. One patient even received a bill for $108,951.

Invitation Homes has spent $150 million weekly purchasing foreclosed homes since 2012, now owning over 110,000 properties, paying $48 million in FTC (Federal Trade Commission) settlements in 2024, and mailing average refunds of $106 to 444,131 tenants. However, in the quarter after the settlement, rents still increased by 4.5%.

We consider tokenizing real-world assets (RWA) to be the best tool for achieving financial inclusion, arguing that fractionalized real estate will make wealth more accessible. But does breaking a house into digital tokens really help local buyers compete with a company that is throwing $150 million a week at acquisitions?

What it does is merely digitizing the inventory for giant companies. Large companies own 1% of housing across the U.S., but they control 25% of housing in Atlanta and 21% in Jacksonville.

A more liquid cryptocurrency layer allows Wall Street to easily buy up these markets. Tokenization does not prevent corporate landlords; it merely creates a faster ledger for them to rent from. Cryptocurrency plays a double-edged role here, it is completely neutral rather than being a savior that automatically saves everything.

The platform model has merely accelerated extraction, making the process incredibly efficient and inescapable. A private equity firm with a single anesthetic clinic runs just an isolated business. But when a single entity buys up all the clinics in major metropolitan centers, the game changes completely. Through shared software coordination, corporate owners raise fees uniformly across hundreds of medical institutions. Individual doctors operate blindly, unable to see the full trap. This is ancient greed operating on more advanced infrastructure.

Wu is very cautious when delineating boundaries. I am not so cautious. The deep mechanisms of these industries reveal a slowly occurring primitive accumulation process within the American middle class. This transformation by corporations practically forces doctors to become standard labor and traps homeowners in a lifetime of rent.

Corporate platforms completely rely on trapped audiences and centralized gates. But we have a technology fundamentally designed to smash those gates. It empowers sovereign individuals to build their own systems, completely outside the reach of the exploitative class. That is the real moat.

Article link: https://www.hellobtc.com/kp/du/06/6338.html

Source: https://www.thetokendispatch.com/p/the-age-of-extraction-part-2