As cryptocurrencies and blockchains have continued to gain steam (and attract capital), a common question in the air is, what type of leader does it take to be successful in this space?
A common variant on that question is: “will [leader] need a grownup in the room once they get ahold of all that money from the crowdsale?”
If it’s not already obvious, cryptocurrency development is open source development. The basic challenge in open source development is to get other technical people to adopt your technology, and to cultivate broad community support around it. The skills required are not just technical, but also political. Open source projects need to strike the right balance between direction, inclusivity, openness, commit rights & governance, etc — you are not only hoping to get people to use your technology, but to volunteer their time to maintain it. Nice trick!
If you look at some of the most successful open source projects, like WordPress, Ruby on Rails, MongoDB, jQuery, just to name a few — you’ll see a common pattern of buttery technology paired with savvy political leadership. The big political risk in any open source project is the fork — since the code is open, anyone can just take a copy and develop that in their own way, siphoning off attention and effort. So the main goal of the politics is to keep people onboard, rather than forking.
“Some people think I’m nice and are shocked when they find out different… I’m not a nice person, and I don’t care about you. I care about the technology and the kernel—that’s what’s important to me.”
So in some cases, (as in with Linux and Git) the technology can be so good that it can survive even caustic leadership.
The next question, then, is: but open source projects need a business model too, right?
WordPress needed WordPress.com (the hosted service) to supply the business model; Ruby on Rails needed Basecamp (saas); MongoDB followed the Red Hat model of enterprise support (and now hosted services), and Linux has the Linux Foundation (corporate donors) — in each case, you had to figure out a way to build a business on top of the open source foundation. Sometimes this works, but lots of of times it doesn’t.
What’s different about today’s crypto landscape is that the business model is built-in to the product, so there’s no longer a need to bolt-on a business model. So maybe we don’t need an adult in the room, at least not in the traditional sense of someone who knows how to “run a business” — making corporate deals, showing up to meetings in a suit, etc.
But, to add another twist: cryptocurrencies are like open source projects that are also central banks — they are both a tech platform and a monetary platform. So, take all of the politics inherent in open source projects (risk of fork, etc) and lever that up with strong financial interests tied to technology decisions: now you have the cryptocurrency ecosystem.
The two biggest examples from today are Bitcoin’s continued struggle to deal with its scaling issues, and Ethereum’s recent hard fork following the DAO hack. Bitcoin may be reaching consensus on scaling after several years, and it appears that Ethereum (under Vitalik’s direction) has recovered incredibly well after the hard fork.
Both of these have shown that you can build a multi-billion-dollar cryptocurrency platform with very little traditional business infrastructure, but that you will undoubtedly face not only the “regular” open source issues, but a new variant that is even more political and highly charged — that’s a tall order, but seems to be what’s required.