Some early crypto enthusiasts have bailed on the sector, saying the movement has bought into hype without understanding the technology's limits

Physical banknotes and coin imitations for Bitcoin crypto currency. OZAN KOSE/AFP via Getty Images
Recent Financial Times Magazine article interviewed several crypto-superfans in their early days who are now disillusioned.

Jackson Palmer, creator of dogecoin, is perhaps the most prominent example of a crypto-backer turning on the space.

The most vocal crypto supporters aren't afraid. Jack Dorsey, a Twitter user, believes that bitcoin will bring about "world peace."

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Although crypto has many detractors, it is the ones who once sat inside the tent that are most interesting - and the most ire.

This is the conclusion of a Financial Times Magazine article that interviewed several crypto-superfans in the early days who are now disillusioned.

The FT spoke to Neil, an unnamed figure who joined Coinbase in 2014. Coinbase was then a small crypto startup. Neil, a student in computer science, first became interested in virtual money as a fascinating programming problem.

He was quickly engulfed in the revolutionary ethos behind the early crypto scene. It promised to destroy the old, corrupt financial system and replace it by something better.

Some of the most prominent crypto advocates today still live by that spirit. Jack Dorsey from Twitter, for example, stated that bitcoin's ultimate goal is to "create world peace" at a July conference.

MicroStrategy's Michael Saylor, who has more than $5B in bitcoin. Saylor, who was famously present at the Miami bitcoin conference in June for the announcement that El Salvador would adopt bitcoin, called cryptocurrency "the apex asset of the human race" and said it "fixes all."

This level of hype about crypto was much lower in 2014 than it was in 2013. Neil found that the relative anonymity of crypto gave him a sense of coolness and a sense of operating in the underground.

"I believe nerdy types like myself got fooled by bitcoin because it made us feel cool, kind of a Revenge of the Nerds-type thing," Neil explained to the FT. "Then, the non-technical people got tricked because they don't understand the technology."

Chris DeRose, a computer consultant-turned-bitcoin evangelist, was likewise enchanted by early crypto culture. He quit his job in 2013 to start a podcast about crypto. He told the FT that he was enchanted by the open discussion that fueled the early crypto and bitcoin communities.

DeRose was not surprised that crypto gained greater mainstream acceptance.

DeRose stated to the FT that "what is bitcoin" is a huge amount of literature and decontextualized media snippets. It paints a beautiful picture."

He said that bitcoin was not being used by merchants, there is no evidence of blockchain efficiency or deployment, and you will see declining merchant uptake. There are also a lot promotional events promising cures for your problems.

Jackson Palmer, the creator of dogecoin, is perhaps the most prominent example of a crypto-backer turning on the space. He posted a Twitter thread in July exposing the crypto space to the world.

Palmer described crypto as an "inherently right-wing and hyper-capitalistic technology" in the thread. He said that it uses a "network shady business connections to extract new money from the financially poor and naive." He described it as a cult, a scheme to get rich quick and said that he was leaving the space.

Despite these critics, crypto enthusiasts still have the upper hand. Every day, more large-ticket companies are making inroads into crypto. They shrug off hacks and sharp volatility.

Leon Cooperman, a billionaire investor, summarized the zeitgeist in an interview earlier this week.

"I tell you that if bitcoin is not understood, you are old."

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