Variant Fund managing partner Jesse Walden believes the core “cypherpunk” ideals that shaped early smart contract platforms could disappear in the next decade. As institutions get more involved, the focus will likely shift toward speed and regulatory compliance.
In a blog post on Sept. 30, Walden reflected on how Bitcoin’s original cypherpunk values, like censorship resistance, open-source development, permissionless innovation, and the dream of a fairer internet built on a global, shared network, fueled the first wave of blockchain development.
Smart contract platforms today focus on “performance, cost, profitability,” and meeting legal requirements rather than the ideological goals they once aimed for.
Cypherpunk ideals vs. crypto’s mainstream growth
Walden points out that many top applications of these platforms like stablecoins, real-world asset tokenization, and decentralized physical infrastructure networks (DePIN) no longer necessarily need to be fully decentralized or permissionless. Instead, they simply need to rely on the decentralized nature of blockchain technology to achieve transparency, compatibility, and secure transactions.
The cypherpunk movement emerged in the 1980s, driven by concerns over government surveillance, censorship, and restrictions on free speech as the internet began to take shape. Some believe that Bitcoin’s creator, Satoshi Nakamoto, was either a cypherpunk or at least deeply connected to the movement because of Bitcoin’s uncensorable and open design.
Walden adds that while cypherpunk blockchains aren’t over, this is “probably just the end of the first chapter.” Walden argues that crypto is becoming more commercialized, and with that shift come certain inevitable trade-offs. For instance, loosening the focus on strict decentralization helps get crypto wallets and apps to users faster.
He likens it to how mainstream music often waters itself down for commercial appeal. Just like a few pioneering artists manage to balance staying true to their core values while making their work accessible to a wider audience, crypto is facing similar compromises as it grows. Walden said:
That mix of determination and pragmatism was admirable because it has the most reach, and thereby, the most impact in taking culture one step forward at the largest possible scale.
