Why is Meme essential to the success of cryptocurrencies?

Written by: Linda Xie, co-founder of blockchain investment agency Scalar Capital, early product manager at Coinbase

Translation: Lu Jiangfei

We consume meme and spread meme every day, but to make clear what meme is … it is really difficult.

The word can hardly be translated. The academic world once gave it a scientific name called "Memes". But in fact, no one used it that way. The word can also be translated as matchmaker, mime, terrier, and so on.

The word is derived from the work of the self-generating gene by the British scientist Richard Dawkins, which means "a cultural unit that can spread among people, it can be an idea, a value, or a certain way of acting, similar The role of genes in biological evolution. "

However, we decided not to translate the word. Let meme be a meme.

The crypto world is inseparable from meme , so we need to learn about it from scratch.


You've probably seen Doge meme on social media. It's a cute Shiba Inu icon with colorful Comic Sans font, saying 憨 萌 such as "such wow". This Shiba Inu picture was first released by a teacher in a Japanese kindergarten in 2010, but this picture later gained its own life because it was widely shared on social media.

Especially in 2013 , 4Chain users bombarded with this meme on a sub-forum of Reddit. In 2013, even members of Congress used this picture on Twitter, and that year also released a cryptocurrency called Dogecoin , which also used the picture as an icon.

Dogecoin was originally a joke cryptocurrency, but later it has established a strong online community, and people use Dogecoin to reward each other for quality content.

In 2014, the Dogecoin community successfully raised $ 30,000 for the Jamaican sled team . At that time, the sled team qualified for the Olympic Games but was unable to pay the toll. Although Dogecoin was originally a joke, its market value has now reached $ 300 million and the average daily transaction volume is also $ 100 million. Dog meme shows that meme can shape reality.

Dogecoin

Meme refers to the concept spread in the community and represents a shared subculture or perception of reality. Meme influences everything around us, from politics, religion to even the exact concept of a nation-state. Each fiat currency is actually some kind of meme, and this fact has become clearer with the advent of cryptocurrencies. Although "currency" is not the only use case for encryption technology, and the meme in the encryption field will evolve over time, encryption technology is used for currency , which is one of the longest and arguably the most powerful meme.

Satoshi Nakamoto published a bitcoin white paper in 2008 titled "Bitcoin: A Peer-to-Peer Electronic Cash System", and a group of celebrities in the Ethereum community often preached that " Eth is money ".

Meme is essential for encryption technology to enter the mainstream, whether as a currency, value store, or something else. However, not all meme can get everyone's attention. In fact, some memes resonate more with certain cultures. If encryption technology is to become mainstream, the encryption community needs to understand how to make meme that can be popular. This means that tailor-made meme needs to be provided to different groups in the non-cryptographic industry so that they can benefit from this technology.

What is meme and what properties does it have?

The term "Meme" was coined by Richard Dawkins in his 1976 book, " The Genes of Selfishness. " He compared meme to biological genes, which can replicate themselves using humans as hosts. Meme and genes ultimately affect human evolution. You can also assess how important a meme is in society. For example, if a meme is a scientific concept that spreads among scientists, you can evaluate the survival value of this meme by counting how many times it has been cited in scientific journals.

Meme itself goes through a natural selection process: some meme gradually die out and some meme become more prominent. There is a natural competition between Meme, some will survive, and some will be eliminated. People have limited attention, ability, and time to store information, so only those strongest memes that can quickly spread through society and be passed on from generation to generation will dominate. Dawkins summed up the concept well: "We were born as genetic machines, but culturally constructed as meme machines."

The Selfish Gene

Eric Hoffer's 1951 book , The True Believer, discusses the nature of mass movement, discusses the concept of " religiofication ," transforming practical goals into sacred causes the art of.

In most successful mass movements , people have begun to abandon their personal identities and see themselves as part of a particular group as part of a great cause. If people start to see themselves as members of a particular meme (be it religion, government, or organization) , the attachment to that meme and its cause will be stronger. Interestingly, discussions on certain topics in the crypto community have also turned into near-religious debates , such as "Bitcoin Block Size" , "Bitcoin vs. Ethereum", etc. In order to show faith, people label themselves with various labels, such as the big blocker and the Bitcoiner .

The work on community building, Get Together, discusses the idea that people often share identities by words or by using demonyms in a certain area. "~~~~" " demonyms" are used to describe people from a specific area People. Demonyms help people identify themselves and make it easier to find colleagues in the community. For example, Beyonce's rice ball is called " Beyhive ", and the NFL Professional Football League Green Bay Packers' fan group is called " Cheeseheads ". These words create a stronger bond between members.

Beyhive

Dr. Robert Finkelstein gave a lecture entitled " Tutorial: Military Memetics " in 2011, discussing military research on meme for national security purposes because of military awareness Meme can change people's values ​​and behaviors and enhance subcultures. The meme study, supported by the Defense Advanced Research Projects Agency (DARPA) , seeks to find out how to ensure that an idea can spread efficiently and what its consequences are. This proves that meme has a huge impact on our society, and the crypto community will also benefit from making popular meme.

Various memes have varying degrees of spread and persistence. For example, a story may spread for several hours for several people, and a religion may spread for millions of people and last for thousands of years.

Research has shown that the smaller the meme, the more important it is, because larger memes can be too complex to remember. Finkstein put forward a concept of " meme on fitness factor ", which is a method to evaluate the quality of meme. It includes multiple attributes, such as the number of people who spread the meme, its persistence, and its influence. .

The non-profit research organization CNA previously released a report titled "Exploring the Role of Meme in the US Government Impact Campaign" , stating that the most engaged meme is usually targeted to a specific audience. Therefore, if you can more accurately determine which audience you want to target, the meme can attract more people's consumption and beliefs . The report also analyzes the importance of visual memes and how they reach cultures and languages ​​to reach the wider community. It is precisely because of this effect that many government movements have tried to use visual meme. The report also mentions that person-to-person participation also helps strengthen meme.

There is a great deal of research on how governments use meme to influence individuals and groups. We should use these resources to do our own research to understand what results can be introduced into the field of encryption.

Popular meme in the crypto community

Gold is one of the most successful meme in history. In addition to being used as a rare metal in electronics and jewellery production, gold has a market value of nearly $ 8 trillion for value storage. Investors are putting money into gold to create a more diversified portfolio, and countries are also storing gold domestically and overseas. So it's no surprise that bitcoin is the "digital gold" of meme, which has been very successful among investor groups .

"Gold repatriation" refers to the return of a government's gold stored in a country to its home country. This process can be quite complicated. Take Germany as an example. They initially stored large amounts of gold overseas because of fear of the Cold War. Between 2013 and 2017, Germany shipped 54,000 gold bars from New York and Paris, valued at $ 27 billion. The process is getting more complicated as these countries have to buy insurance for this gold to prevent accidents in transit.

The " digital gold " meme works because cross-border transportation of bitcoin is much easier and cheaper than cross-border transportation of gold. In the early days, it was ridiculous to call Bitcoin “ digital gold, '' and now even Fed Chairman Jerome Powell acknowledges it. "Few people use bitcoin for payment, and people use bitcoin more as a substitute for gold. It is a speculative store of value," he said.

Because it is still in its early stages, Bitcoin's price volatility can be put aside first. In theory, it is indeed a better value store than gold because its supply cap is limited to 21 million and it is easier to carry than gold. . When speaking to institutional investors, the term "digital gold" makes it easier for them to understand the concept, because many of them have gold or it is easy to understand what it means to hold gold in their portfolio.

Although the "digital gold" meme works well in some audiences, it doesn't resonate with everyone. We need to play grassroots efforts in the local community to create meme that can attract people from different backgrounds.

For example, when people in the crypto community talk about how Bitcoin is anti-censorship, many Americans don't know what it does. Some people associate anti-censorship with illegal activities and find it a bad thing. Others don't even know what anti-censorship means. Residents of some countries believe that their laws are fair and reasonable, and they may not immediately understand that in a repressive country, illegal transactions between residents may be perfectly reasonable, even if it cannot be said to be good behavior.

Another popular meme in the crypto circle is " HODL ", which is used to emphasize those ideas that are still held and not sold during volatile periods.

The word "HODL" first appeared in 2013 when a netizen misspelled the word "hold" on the bitcointalk forum. Memes like "HODL" make crypto communities stronger because they make people more united in difficult times.

Although more meme of this type is better, it may not make more people understand or use cryptocurrency, because people in non-crypto circle do not know the meaning of these meme. We need to create some meme that will bring outsiders into the field.

In order to better understand how the meme of the crypto circle is different around the world, I tweeted a post, hoping that the crypto industry people who live outside the United States will contact me. I asked them a question: "When you discuss cryptocurrencies with people in your country, what do you find most resonating and which do not resonate?" Soon I received 100 from more than 50 countries Multiple replies show how global the crypto circle is. Note that these responses are personal opinions and do not represent the entire country. I find their perspective helps me better understand which narratives are more effective.

Unsurprisingly, many people don't find the term "digital gold" attractive. And people have different opinions based on age or other differences. For example, the younger generation growing up with the Internet is more interested in cryptocurrency and more open-minded.

Outside the crypto community, what are the popular crypto memes

It is often believed that encryption has some negative meaning, which can be offensive to newcomers. Bitcoin has always felt guilty for being used for illegal transactions such as buying drugs, but according to a study by blockchain analysis company Elliptic , these illegal transactions account for less than 1% of the volume of transactions sent to exchanges. .

Some memes are indeed stubborn. For Bitcoin, being used on the dark web to buy drugs is a particularly durable meme. This also means that this effect needs to be replaced with a stronger meme in order to eliminate people's psychological barriers. However, many early technologies–such as the Internet and streaming video–have also undergone transformations that have eventually transitioned from associations with illegal activities to the mainstream of society. The transformation was successful because of the apparently legitimate mainstream use cases . We look forward to similar transformations for cryptocurrencies.

Another common theme is that cryptocurrencies are an investment opportunity. This doesn't sound too ideal, because we want people to understand encryption technology first, but I think this meme is also good. There are opportunities to make money, which can be attractive and help spread. As more and more people invest in cryptocurrencies, they will try to understand its working mechanism and impart knowledge to others, and may be hooked on it out of interest.

Some of the smartest people in the crypto industry I know are creating amazing products. They first entered the industry and heard about this new thing from friends or the media after the price soared. Now I don't expect everyone to stay because they care about this technology, but I don't think there is any problem in treating this topic as meme. In fact, this is no different from people investing in stocks, gold or real estate. But on the other hand, some people will use people ’s desire to get rich quickly and create some Ponzi schemes or other conspiracy that guarantees returns. Therefore, we must clear these bad behaviors and establish reasonable expectations for people outside the crypto circle.

Another ongoing topic is that many people unfamiliar with the investment industry don't really understand the true meaning of "digital gold." For such people, this approach simply does not excite them for a new technology. Imagine a person who has never invested in or cared for gold, what incentives are there to explore its digital equivalent? Why should we expect them to be excited about it? Many mature investors who recognize gold as a premium store of value also have questions about Bitcoin as "digital gold" because prices are too volatile. I heard that some investors tend to view cryptocurrencies as an alternative asset class.

Many people believe that the word "encryption" has a negative meaning, while the word "blockchain" has a more positive sentiment, because governments and companies often call blockchain a promising innovation .

Many people in the crypto circle do not like to use the term "blockchain" because banks and companies often use this hot word to describe permissioned databases, which usually lack the openness of public blockchains. " Blockchain, not Bitcoin " is a meme developed in traditional financial institutions and enterprises. They believe that blockchain technology is very interesting, and Bitcoin is not important. In view of these industry references, when you communicate with people, it is necessary to adjust different terms for different groups of people in order to let the other party learn more. For example, when facing people who suspect "cryptocurrency", it is better to use words like "blockchain", "digital currency" or "digital assets", so that they can more easily attract their attention.

I also found an interesting phenomenon: young people like cryptocurrencies to be labeled as " magic internet currency ". This is actually a relaxed meme. It was first created as an advertisement for entering the Reddit sub-forum r / bitcoin. The ad includes a wizard sketch drawn with Microsoft drawing tools, accompanied by the phrase "magic internet currency." This ad makes people more excited about this technology and hopes to learn more. I did n’t like to use this meme before, because it ’s a bit stupid for technical experts, but if you want to make more people interested in encryption technology, then this easy to understand statement is actually more helpful .

I also heard that many people are using another meme, that is, the cryptocurrency is the " internet of money" , which seems to have resonated with some technology-sensitive people. The important thing is that even if you have deep preconceptions about a meme, it is best to consider the characteristics of the audience and think about what is the most attractive statement.

WeChat picture_20200218194439

Magical internet currency

Perspectives vary by country

After talking with people from different countries, I found some highlights worth summing up. This does not include all the replies I have received, I just want to make it clear that the feedback varies from country to country. I emphasize again that the following is the personal views of those who are interested in encryption technology, it is not a representative sample.

In countries with high inflation , capital controls, or a low level of trust in governments and institutions, the anti-censorship nature of cryptocurrencies is more likely to resonate with locals. Of the responses I have received so far, Argentines are the most. Argentina is currently in an environment of high inflation, restrictions on the exchange of dollars, and restrictions on overseas remittances, which just provides a perfect use case for cryptocurrencies.

Anti-censorship can resonate with some people because residents generally don't trust banks to keep their funds safe. I understand that many Argentines are economically savvy because they have to manage their savings to avoid being swallowed up by inflation. Argentines are most concerned about how to easily obtain currencies other than the peso, which generally refers to the US dollar. Because the US dollar is so focused, I think the best meme in Argentina may be to help get some kind of stable digital currency. Therefore, the stablecoin can be used with the US dollar as another option for Argentines to escape the peso.

I highly recommend Mariano Conti's highly-inspired presentation on Devcon 5 , where he describes how to get paid for the stablecoin Dai and how this approach helped him survive the inflation in Argentina.

Mariano Conti at Devcon 5 explains how to get paid with stablecoin Dai

In some countries, receiving and sending funds across borders is very difficult and expensive, and people living in these countries are often more receptive to the notion that cryptocurrencies have no borders and transfer costs are low. Several people from Nigeria and Rwanda shared that using cryptocurrency remittances resonates locally because cross-border remittances are inefficient. And Indian technical experts report that many IT service providers serve overseas customers and they often have to pay high cross-border remittance fees. So I heard that for these people, cryptocurrencies make a lot of sense.

The term "digital gold" may be more suitable for countries with a strong gold culture, such as in India, where people buy gold jewelry and pass it on to future generations. However, it may take a long time for cryptocurrencies to become popular in these places, as it is now mainly associated with speculation and fraud, and politicians and the media further promote this negative attitude.

Some countries have strong banking systems that resonate with locals that cryptography can bring financial innovation or create a new asset class. Some Canadians share that people in their country do not associate cryptocurrencies with anti-censorship because anti-censorship is not necessarily a good thing. I keep hearing that Canadians have a high degree of trust in banks, so decentralization is not attractive to them. What is of interest to some people is that cryptocurrency is an evolution of money, and it does not have to replace the entire financial system. Similarly, Swiss investors seem to see cryptocurrencies as an alternative asset , which can not only increase diversity, but also bring financial innovations such as asset tokenization.

In some countries that are more concerned about privacy, people may find the privacy advantages of cryptocurrencies attractive. For example, Germans pay great attention to privacy . I understand that this is why Germans use cash heavily. Especially in Berlin, the local technological atmosphere is strong, and if tied to the value of privacy, it can attract people to approach cryptocurrencies.

My advice to the crypto community

The purpose of this article is not to point out how people in a particular country view encryption technology, nor do they want to generalize the characteristics of cultures. I just want to clarify that meme is critical to the success of cryptocurrency and we need to create some new meme that is sticky.

There are many people trying to promote the "digital gold" meme, but this meme does not seem to resonate with many people around the world. It is important that people from diverse communities identify and share various memes, because only they know which meme is most effective. If only a small group of well-known cryptographers, namely technical elites, are to make meme and hope that they can resonate with people around the world, this is obviously not the best choice. We need to do some meme propaganda experiments with new stories and new forms. In summary, I try to provide some suggestions for the crypto community, which will help expand the crypto community to a wider mainstream audience:

  • Meme should be short
The important thing is to make it as easy as possible for people to share with others so that the virus is most likely to spread. To understand the success probability of a meme, we can ask someone to do a test, such as seeing if they can remember it later. The ideal meme should be no more than a few words and easy to translate into other languages.
  • Tailoring meme to your audience
If it helps people learn this technology more openly, then there is nothing wrong with using the words "blockchain" or "digital currency." If someone finally enters the crypto circle, we should teach them some popular meme in the community, such as " HODL ", to strengthen the connection between each other. Giving these people a name like " Bitcoiner " also helps strengthen their identity.
  • Use visual meme whenever possible
Visual meme can often transcend different cultures and languages ​​and spread quickly. A currency like joke coin comes from a joke, because with a cute Shiba Inu figure , its market value can reach 300 million US dollars. Fun memes like this can also be effective, so don't be shy, magic like "magic internet currency" may also be attractive to tech elites. By calculating how often a meme appears on Google or social media, we can measure their success rate.
  • Keep track of which meme is most effective

The crypto community should collaborate openly to find out which meme and methods are effective, and then iterate on it. We can track these factors: the number of people who share meme, the duration of meme, and its impact .

I am very optimistic that with the development of this technology, community, and appropriate meme, we will definitely make cryptocurrencies mainstream.

Thanks to Laura Shin, Will Warren, and Jordan Clifford for reviewing my article, and to many people around the world who shared their views on Twitter.