Omicron Crypto Is a Bet on Attention

The basic innovation of crypto is the production of artificial scarcity. The original Bitcoin white paper addresses the problem: Sure, anyone can type numbers on their computer, but is there a way for a community to allocate numbers on your computer in a way that makes them demonstrably scarce? If there is, then you can call those numbers “money” and they can be valuable. I am being a little annoying, but this was obviously a real innovation and did in fact help make Bitcoin very valuable.

The rest of the crypto world continued applying that same process. Most non-fungible token projects address the problem: Sure, anyone can limitlessly reproduce JPEGs on the internet, but is there a way for a community to allocate ownership claims to JPEGs in a way that makes them scarce? The answer is … not really, no, in the sense that anyone can still right-click and save the JPEGs underlying most of the popular NFT projects. And yet the answer is also “sort of,” in the sense that NFT communities tend to respect the allocations of ownership claims; they act like the JPEGs are scarce — the NFTs, the ownership claims, are scarce — and so they have value. And so some NFTs sell for lots of money.