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Guide: What is Tribalism in Crypto?

As humans, we’re a social species. Our inherent desire to unite behind a common identity is thought to reflect our hunter-gatherer past. Outsiders were viewed as potential competition for food resources and therefore a threat to the survival of the group. 

Today, this natural trend is seen in our family connections, association with sports teams and political parties and feelings of national identity. 

Unsurprisingly, it’s also present in crypto and is largely seen as one of the toxic traits found in the space. Let’s take a closer look

A united community?

While the hope for decentralisation and freedom from a centralised authority should unite the crypto community, many groups that make up the space often do the opposite. 

Now, more than ever, the centralisation of power presents a serious threat for everyone, everywhere. Our privacy, autonomy, and freedom are increasingly at risk. But too often, “how can we create a better world,” is replaced by “how can we defeat other projects?”

Tribalism & echo chambers

Tribalism in crypto typically stems from where people get their information from. Much of the crypto conversation takes place deep in Discord subreddits and on Twitter. 

Forums for a particular project can often create an echo chamber. In these forums, people often feed each other the information they want to hear, which soon fosters a very narrow mindset. 

If someone is told by enough people that a project ‘is the best in the market,’ they’re likely to start to believe it. 

Small communities arise out of these forums with the desire to support their favourite projects as hard as they can and pit them against others. 

The sense of community is strengthened not only by the fact that these investors share the same beliefs in a project, but that those beliefs are embedded in finance, as they will have their invested capital in the project too. There is a sense of belonging through success and loss. 

Counterproductive

There’s nothing wrong with supporting an idea you believe in. But this line of thinking is counterproductive to what crypto is all about- innovation. 

An example of this mindset can be seen among Bitcoin maximalists. They believe that Bitcoin is the only digital asset needed in the future and that all others are unnecessary. 

Vitalik Buterin: “The idea that an environment of multiple competing cryptocurrencies is undesirable, that it is wrong to launch ‘yet another coin,’ and that it is both righteous and inevitable that the Bitcoin currency comes to take a monopoly position in the cryptocurrency scene.”

“A simple desire to support Bitcoin and make it better; such motivations are unquestionably beneficial…rather, it is a stance that building something on Bitcoin is the only correct way to do things and that doing anything else is unethical. Bitcoin maximalists often use “network effects” as an argument and claim that it is futile to fight against them.”

By no means does this suggest that Bitcoin isn’t a valuable asset. However, competition drives innovation and for a project to prove it’s better than the rest it must produce a product that is better. Useful projects will accrue value no matter what people think about them.

So it’s important to avoid getting caught up in an echo chamber of misinformation and fanaticism. Learn more about Tribalism in crypto in our Mental Fortitude course. 

Disclaimer: THIS IS NOT FINANCIAL OR INVESTMENT ADVICE. Only you are responsible for any capital-related decisions you make and only you are accountable for the results.

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Nicola Rainsford

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