What I'm reading this week – July 23, 2021

Facebook and free speech, DeFi, and more

Now that I’m posting more on The Terminal — hopefully you’ve noticed — I’ve decided to break out my reading list into its own weekly dispatch rather than including it scattershot at the bottom of other posts, which I haven’t been doing recently anyway.

The click-through on these links has historically been pretty high, so I’m taking that as an indication you guys do get something out of it. Hopefully I’m right, and you can feel free to reply to this email or leave a comment telling me to fuck off, get fucked, fuck myself etc if I’m not.

(While I have you: I’m always keen for feedback on the stuff you’re enjoying reading on The Terminal, and the sort of thing you’d like to see from me in future. Again, feel free to reply to this email or use the comments to sound off.)

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Zuck’s world

The Verge has a long interview with Mark Zuckerberg up which I found interesting. A lot of it is about the notion of the ‘metaverse’ — that theoretical point where online and the physical converge through a bunch of mediated experiences (augmented and virtual reality, for example) — and how Facebook seeks to deliver on that vision. It’s all very rehearsed on Mark’s part, but this part caught my eye, where he was talking about vaccine misinformation:

But when you think about the integrity of a system like this, it’s a little bit like fighting crime in a city. No one expects that you’re ever going to fully solve crime in a city. The police department’s goal is not to make it so that if there’s any crime that happens, that you say that the police department is failing. That’s not reasonable. I think, instead, what we generally expect is that the integrity systems, the police departments, if you will, will do a good job of helping to deter and catch the bad thing when it happens and keep it at a minimum, and keep driving the trend in a positive direction and be in front of other issues too. So we’re going to do that here.

I’m fascinated not so much by the content but the metaphor. Facebook is essentially so large that it behaves like a state, and understanding how a state conceptualises itself and its ‘citizens’ is useful. Byrne Hobart, who writes one of my favourite newsletters The Diff¹ has dedicated a few posts to thinking through this, including the thesis that all platforms eventually have to do something that looks a lot like local politics. In his view, Zuck does not act like a head of state at all despite his obviously imperial vision.

…the problems Facebook has to solve are not the cosmic, inspiring ones. They’re pretty trivial, technocratic issues, mostly dealing with competing interest groups rather than competing ideologies. Zuckerberg isn’t an emperor, or even a prime minister; he’s the world’s most competent and most overworked mayor. The question of how much data an advertiser should be able to collect and use, and how they should be able to use it, isn’t a question with the same scope as a treaty or a labor law; it’s a lot more like deciding where a sewage treatment plant goes or choosing which bus route to cut.

The question of free and proscribed speech, at the end of the day, is also treated this way by Facebook. People have very deeply held views about free speech, but Facebook — or Twitter, or any other large platform — does not really need to engage with these views on an ideological level. It just needs to find the right balance of interests to project the image that it is protecting both safety and free speech, such that people who value one or the other keep using the platform. It feels like a local council appeasing different ratepayers rather than an issue of civilisational importance.

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DeFi and other mysteries

If you pay even passing attention to the world of crypto, you will have come across the word DeFi (meaning ‘decentralised finance’). At its simplest, it refers to using smart contracts and blockchain platforms (mostly Ethereum) to do all the sorts of things we generally require intermediaries like banks, exchanges and brokerages to do.

As with all things crypto, the DeFi community seems divided between two camps: the maximalists who think it is actually going to make the world’s financial system work better or more efficiently, and the speculators who see gold in them hills and are keen to make a quick buck². I find my eyes glazing over reading anything from either camp.

So I was keen to listen to this episode of Bloomberg’s Odd Lots (great pod) trying to demystify DeFi and explain how it might actually benefit normal people who aren’t obsessively reading crypto blogs and whitepapers. The interviewee, Tom Schmidt of Dragonfly Capital, fails to do so — at least in my view.

But he fails in an interesting way, and I think his inability to do so gets at the heart of why I find it hard to believe this stuff is ever going to cross the normie barrier. That doesn’t mean it won’t be important, but it makes me worry a lot about how its inscrutability will be exploited by very bad actors and Ponzi freaks.

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Odds and ends

• I was on the Champagne Sharks podcast talking about this newsletter. It ended up being a really great, expansive chat about weird trends in the online economy. Also Sydney had only just gone into lockdown when I recorded it, so I sound relatively normal.

• I’d wager many have already read these but Rick Morton’s two-parter on the Australian vaccine rollout shitshow is very good.

• Great read on a bizarre Turkish Farmville clone which weaved “a complicated, meta-business model” involving actual farms and agricultural produce before the founder absconded with $80 million. When we’re talking about the ‘metaverse’, maybe this sort of thing should automatically come to mind.

• I enjoyed this on the quest to understand why Venus, our next-door neighbour in the solar system and quite similar to Earth in a lot of fundamental ways, ended up as an inhospitable hellscape.

• An interview with Eric Nelson, VP and executive editor at HarperCollins’ conservative imprint Broadside Books. I’ve always found the tension between the (often elite) liberalism of the American publishing world and the big-selling conservative authors they put out very interesting, and this unpacks some of that friction.

As always, if you’ve found yourself here but don’t subscribe, avail yourself by slamming the button below with enough force to break your mouse, trackpad or screen:

1. It’s pricy for a sub but worth it if finance/business/tech is your bag. I feel like I learn something useful or novel from almost every issue.

2. As with bitcoin and other crypto, the latter camp seems to dominate by some margin.