The fall of crypto, and the permanent ascent of Substack and the ‘wordcels’

First there was Covid. There was the suspense of the possibility of the world coming to an end, and then the sigh of relief when it didn’t. And then the euphoria and exhilaration of the stock market, tech/start-up, and crypto surge that followed.

The 2021 crypto surge was like a proletariat revolution of the masses against elites, as an opportunity for average people to strike it rich and rise up after having been subjected to Covid restrictions a year earlier.

Now we’re now in the hangover phase thanks to higher interest rates and a sudden surge of inflation in 2022. The collapse of SVB and the contagion that followed and that was stopped with yet again more bailouts, is the belated consequence of this.

A lot of people, particularly in the tech, crypto, or ‘VC scene’, are struggling after having done so well in 2020-2021. Many people who I follow have have gone dark since mid to early 2022 or are posting much less frequently. Barry Silbert has not updated his Twitter since Jan. 2022, and Chamath disabled comments on his after getting thousands of comments per tweet in early 2021, after being heckled by his followers for his disastrous SPACs. And David Sacks and other VCs took a reputational hit with the SVB bailout.

Same for Vitalik Buterin, who updates only sparingly (just three tweets for all of 2023) after in Feb 2022 throwing himself before the Ukraine cause (a lot of people, him included, were expecting an easy win for Ukraine; not so, as I correctly predicted). And what ever came of Gary Vaynerchuk’s NFT collection anyway?

I don’t have much of a dog in the fight, but I found it odd how so many ‘progressives’ were suddenly pro-war. It’s like what ever happened to ‘give peace a chance’?

As the VC and crypto world burns or goes dark, top Substack writers are making record income. Metrics such as subscribers counts, comments, and ‘likes’ keep rising for the dozen or so Substack blogs I follow, sometimes by as much as 1,000% compared to early 2021. Yet this is just a small fraction of overall people. Crypto and stocks allowed average IQ, generally untalented people to get rich by ‘hodling‘, not being high IQ ‘wordcels’ like required for Substack and to a lesser extent Twitter success. The do-cels (people who deal less with abstractions and more with ‘doing things’) have been replaced by the articulate-class, who dominate discourse and are making money with blogs and subscriptions as crypto falters. ‘Shape rotators’ are not doing so well either, as tech companies have major layoffs.

Chat GPT has sucked all the air out of the room like a super-intelligent paperclip maximizer, that rather than consuming carbon to make copies of itself, is propagated by the media and everyone talking constantly about it. But unlike surging stock prices or crypto, no one is really making money from it. All it does it generate media hype and interesting use cases, not money in the bank or bigger account balances. Same for hype about DeSantis, Trump, Florida, etc. It’s a battle of attention between bloated, uninspiring egos.

None of these things are going to get better. No one is gonna throw a lifeline for your underwater crypto investments or worthless NFT art. Same for ‘meme stocks’. Russia and Ukraine will remain deadlocked…no one wants another quagmire like Iraq or Afghanistan. Interest rates and inflation will remain high for a long time. There will be no definitive closure about the lab leak theory, either. It will remain in a sort of quantum state of being both true and false.

Substack is going to continue to boom…not that other crap like crypto, NFTs, Shopify, Etsy, etc. And Meta stock: that will do well too. Either you get with the winning team or sit out. In 2020-2021 it was crypto and meme stocks. Now it’s Substack and Meta.

When Meta stock crashed from $375 in 2021 to $100 by late 2022, many seemed elated that the ‘old guard’ of social media, the scourge of society and the root cause of political division and blamed for teenage anxiety, had come crumbling down. But sure enough, Meta has recovered significantly, back to $205 so far for 2023 (I still predict it’s going back to $300+ soon).

As much as chat GPT is promised to change the world, annoying ads, social media anxiety, and mobile advertising aren’t going anywhere either. And same for predictions of AI making writers obsolete; again, this is not yet borne out by the evidence, which shows top Susbtack writers (as well as content creators on YouTube) earning record revenue.

The past three years, such as the rise and subsequent crash of meme stocks, crypto, Shopify/e-hustle culture, and the ‘VC scene’, combined with the permanent Substack boom, shows the importance of not overstaying your welcome. Things change suddenly; winners can suddenly become losers. Maybe in a later post I will try to expound on why Substack has resisted the decline seen elsewhere.

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