Author: Mario Laul
Compiled by: TechFlow
The foundations of public blockchains were laid by Cypherpunks. Although the crypto industry has been destined to embrace diverse ideas and practices from the beginning, the core principles of decentralization, open-source software, cryptographic security, privacy protection, and self-sovereignty have always been the cornerstones of its most disruptive achievements.
However, this field also faces a core problem: in the absence of a regulatory framework that supports innovation and recognizes blockchains as a unique administrative infrastructure, crypto entrepreneurs are faced with a difficult choice - either to adhere to the ideals of purism, making the structure and operation of projects more complex; or to compromise on the original ideals in exchange for regulatory recognition and a more traditional mainstream path to success.
I call this dilemma the "Cryptopreneur's Dilemma".
Since the birth of blockchain, it has carried a grand vision: to achieve the separation of money and the state, to establish a censorship-resistant global payment and coordination network, to develop software services without single points of failure, and to create entirely new forms of digital organizations and governance. Driving such revolutionary change requires a special historical context.
For the crypto industry, this context has been shaped by the aftermath of the global financial crisis and the evolution of the data and business models of Big Tech companies. At the same time, the global proliferation of digital technologies and the embedded Token incentive mechanisms have provided almost ideal conditions for the rapid development of the early crypto ecosystem. Since then, as social and financial capital has accumulated within individual blockchain networks and the industry as a whole, the crypto industry has gradually become an undeniable force, as evidenced most notably in the 2024 US presidential election.
However, driving revolutionary change requires not only courage, but also a certain degree of "sociological naivety". Any attempt to disrupt social structures, especially those based on law, often has a much higher probability of failure than success.
The crypto industry has indeed seized on the public's discontent with the traditional system by challenging existing institutions, but this confrontational stance is difficult to reconcile with the goal of building digital platforms that serve a global user base. Similarly, blockchain transactions attempting to circumvent the regulatory requirements of the jurisdictions (whether the operators of the underlying infrastructure or the transacting parties) always face the risk of intervention by local law enforcement.
For the crypto industry to achieve real growth and influence, it must accept the formal status of its regulation and the various consequences that come with it. As the famous saying goes: "You may not be interested in the state, but the state is certainly interested in you."
While many aspects are still constantly changing, this is what we are seeing in practice. From taxing crypto-related activities, classifying Token-based assets, to implementing anti-money laundering and counter-terrorist financing (AML/CTF) rules, and clarifying legal responsibilities in DAO governance, the crypto industry is gradually being integrated into the existing regulatory system centered on national jurisdictions.
However, what is more noteworthy is that this process has also given rise to new case law and customized regulatory frameworks - these frameworks have become the key battleground for defending the original values of the crypto industry, preventing them from being ignored or destroyed in ideological and political struggles (whether intentionally or unintentionally). The existence of the "Cryptopreneur's Dilemma" is because, like any innovation activity with far-reaching impact, the process of its legalization is slow and controversial. For the crypto industry, this process is particularly difficult, as the actions of some malicious opportunists have led to misunderstandings about the industry's image and unnecessary collateral damage.
Another notable trend is the increasing integration of blockchain with traditional business and financial systems. For those who view the crypto industry as a parallel system aimed at replacing traditional institutions, this integration blurs the boundaries between the two, potentially causing cognitive dissonance and internal conflicts. For others, however, this integration is precisely a sign of success, and the only sustainable path for blockchain to become a systemically important infrastructure. As the industry matures and reduces risks, its practitioners, operators, and user communities will also continue to expand and diversify. While this trend has attracted the attention of traditional enterprises, it may also further exacerbate the ambiguity of the crypto industry narrative, especially when traditional institutions attempt to control what appear to be neutral infrastructures. The risk of "institutional capture" will increase proportionally with the proliferation of the crypto industry.
So, as public blockchains enter the next stage of their adoption curve, how should the "Cryptopreneur's Dilemma" be repositioned?
On the one hand, the mainstream success of the crypto industry seems to depend more on deep integration with existing systems, rather than clinging to some idealized, fully decentralized vision. Accepting the fact that most "crypto projects" may ultimately be no different from traditional enterprises or open-source software initiatives, or that most blockchain users are unlikely to fully embrace the Cypherpunk ideology, let alone make it a primary basis for their consumption decisions, is not an unacceptable thing. As long as these systems can maintain openness and verifiability, and be more resilient than existing alternatives, the "decentralization performance" is largely irrelevant, and centralized enterprises utilizing and operating public blockchains is also justifiable. Therefore, once the regulatory status of the crypto industry is clarified, this dilemma may no longer be important for most entrepreneurs.
However, it would be incorrect to see this as the end of the original vision of the crypto industry. Technologies such as autonomous robots and artificial intelligence (AI) are injecting new, far-reaching impetus into the digital revolution, and the demand for powerful computing and information management services is more urgent than ever before.
As an innovation platform, blockchain can provide alternatives to traditional systems that are vulnerable to corruption, mass surveillance, and single points of failure. Only when a sufficient number of entrepreneurs and supporters persist in the difficult path of building truly decentralized, privacy-preserving, and anti-control systems can blockchain continue to exist. Although the commercial success of the crypto industry may no longer depend on these ideals, its long-term social impact will undoubtedly still depend on them.
