Why does crypto always create "casinos" but rarely develop "indispensable products"?

Writing by: Thejaswini MA

Translated by: Plain Blockchain

"Sofalarity." This is my favorite word this month / this year (depending on what I read next).

I realize belatedly that my own exhaustion is precisely the state this system requires me to exhibit in order to keep it running, and this is not a personal failure. I slump on the bamboo sofa, adopting a posture that will definitely cause back pain, and ask Alexa to turn on the lights. Because what I just read is starting to feel uncomfortable and too personally targeted.

Everyone knows "singularity," the theoretical point where AI surpasses human intelligence and everything will change forever. We haven't reached that point yet, but "sofalarity" is already here with us in this room.

At this node, convenience itself has become so absolute that leaving one platform feels almost like moving to a country where you might not find a bamboo sofa—impractical and unrealistic.

The ecosystem you choose to stay in seems to offer no drama or friction, providing convenience that genuinely improves your life. But you can see friction elsewhere; that’s why we keep making the same choices. But is it really your choice, or has the choice already been made for you?

This book describes a phenomenon I think most of us know but lack the words to express. Staying on a platform you’re not even sure you like, with that (comfortable) heaviness. The feeling of wanting to switch platforms isn’t impossible, but for some reason, just thinking about it before starting makes you exhausted. The author borrows a term from stoner culture to describe it: "couch lock." The meaning is self-evident.

As always, my mind immediately drifts back to crypto. Can we build a product smooth enough to induce "couch lock" in people? Or have we already made that promise, tried, and failed miserably? Are we completely outside the comfort zone of consumer safe havens, or just trapped at its bottom?

Look at how these applications leverage what psychologists call "variable reward schedules" to keep us addicted. It’s the slot machine effect that fuels gambling addiction, and this effect is everywhere in crypto. Price volatility acts as one of the strongest slot machines ever. Most positions don’t move much. Occasionally, some assets surge tenfold. This unpredictability triggers compulsive checking behaviors, just like refreshing Instagram notifications or TikTok videos.

Crypto’s variable reward system skips platforms and directly pulls people toward price charts, where traders’ dopamine builds up. It lacks the habitual system dependence that big tech platforms rely on for profit. This probably explains why, after fifteen years, speculation remains the only consumer product crypto can sustain.

Wu explains why platforms spend billions on things seemingly unrelated to their core business. Google pays $17 billion to buy NFL broadcast rights, or Amazon spends $11 billion on Thursday Night Football. Their goal is time. They want to control enough of your Sunday to make your entire week naturally revolve around their interface.

Every hour you spend within a platform’s ecosystem is an hour you don’t consider whether better options exist elsewhere.

For Indians, there are two choices to watch "The Office": Netflix and Amazon Prime. The benefits offered by Amazon make it a good choice, with many privileges for Prime members.

"If it’s simple, it will win," Wu says.

Borderless money, self-custody, and transparent systems are all good. But this pitch requires convincing others first that something they think isn’t bad is actually bad. Most people don’t think about how to fix the correspondent banking system while walking down the street.

The "convenience gap" of the internet is obvious to everyone. "You no longer need to drive to the post office." Okay, convinced.

This contrast is immediate and obvious. The gap in crypto is similarly real but almost invisible to ordinary people living within it. This inefficiency exists inside institutions, within settlement layers, and within the correspondent banking systems most people never need to understand. "Replacing all this with blockchain" sounds like alien language to ordinary users.

The internet replaced things that troubled everyone. Booking flights at a travel agency by car was tedious. Renting movies at a video store was annoying; if you were late, someone else already took it. When the internet eliminated these barriers, people immediately felt the difference because it made their lives more comfortable. Explaining these solutions to people, they are willing to accept them.

Crypto is replacing things most people have never thought about. An ordinary person sending money to family abroad only knows it takes days and costs money. They probably don’t know what a correspondent bank is. They don’t care that their $200 transfer passes through three or four intermediary banks before reaching the destination, each charging fees. They only know that the money can more or less arrive, and they will keep sending it next month.

Switching this entire system to blockchain, the sender’s experience is roughly the same. It might be faster. Fees might be lower. But their life doesn’t change visibly. They won’t have a "Oh, I never have to do that again" epiphany. That’s the problem.

Adoption has always been the challenge for this industry, not the users. As long as crypto still needs explanation to be understood, no matter how good the technology, it will always remain in the "nerd" category.

What is crypto missing? The chapter on data needs to be viewed from a completely new perspective.

Google and Meta’s total ad revenue in 2024 reached $360 billion because they spent twenty years collecting every move you make. Every scroll or long pause on a post helps build a machine that can predict your next move. Brands paid billions for this prediction. And from the moment we opened our first account, we built this engine for them completely free.

Wu compares this to a poker game where your opponents have watched every hand you played. They remember your bluffs and worst calls. They play within the rules but see through your mind. This advantage compounds over billions of independent hands, eventually creating a corporate empire.

I then wonder if crypto has something similar. No, I’m not talking about prediction markets.

The entire Bitcoin blockchain (including every transaction since 2009) is about 611 GB. Meta processes more data every few hours. Ethereum’s on-chain data is richer but only captures financial behavior: wallet addresses, transaction amounts, protocol interactions. It shows what someone did with money but offers no insight into "why." It misses countless small daily choices that make behavior predictable and valuable in business.

900 million people use ChatGPT weekly, sharing work files, medical issues, anxieties, and business strategies. It helps them. When they use it, they don’t see privacy trade-offs.

People often hand over their private search histories and location data to big tech for daily convenience. Now, expecting the same audience to suddenly care deeply about financial sovereignty and transparent ledgers is unrealistic. Some do care. Some care but are busy working. This pitch only appeals to those already convinced. If you want large-scale adoption and to create "everything apps," this approach is ineffective for growth.

Wu challenges Shoshana Zuboff’s view of "surveillance capitalism." She claims platforms create Skinner boxes—like mini-games that, through surprise rewards, trick our brains into checking them again and again. He counters that large-scale attention manipulation existed long before big data on the internet. I agree with him on this point.

Goebbels didn’t need recommendation algorithms. Yes, the "totalitarian control" framework is somewhat exaggerated.

Look at variable reward mechanisms. As we discussed at the start, crypto has them too. The constant ups and downs of prices are like a huge, exciting surprise game. But that thrill never locks you into a practical daily app.

The more you rely on a tool, the worse you become at doing that thing without it. When the tool is just a calculator, it’s no big deal. But when it’s infrastructure owned and controlled by others, it gets complicated.

Crypto keeps repeating this problem. Developers build on sequencers they can’t control. Protocols depend on liquidity providers who can leave at any time. Applications rely on chains run by a few validators. Each layer feels like progress but isn’t entirely. You’re building on someone else’s foundation, and without their permission, you’re stuck. Web2 is the same. If AWS goes down, half the internet stalls.

Now, let’s revisit IBM’s analogy. IBM dominated that era by building elite enterprise infrastructure and letting applications run on top, bypassing the consumer "couch lock" battle altogether.

The best realistic outcome for crypto might be more like this, which we only recently realized. Settlement rails, institutional clearing, cross-border infrastructure—no one wants to rebuild from scratch.

It’s a major achievement, even if it’s completely different from the dream of consumer super apps.

In the second half of the book, the focus shifts from technology to exposing how the same corporate tactics dominate healthcare and housing. I think mentioning this is very important.

Welsh, Carson, Anderson, and Stowe bought up anesthesia practices in various cities because anesthetized patients can’t compare prices. Between 2012 and 2017, prices rose 26%. One patient even received a bill for $108,951.

Invitation Homes has spent $150 million weekly since 2012 buying distressed homes, now owning over 110k properties, paying $48 million in FTC settlement in 2024, and mailing an average of $106 refunds to 444,131 tenants. Yet, in that quarter after settlement, rents still grew 4.5%.

We see real-world assets (RWA) tokenization as the best tool for financial inclusion, arguing that fractionalized real estate makes wealth accessible to more people. But splitting a house into digital tokens—can it really help local buyers compete with corporations spending $150 million weekly on acquisitions?

All it does is digitize inventory for giants. Large companies own 1% of housing nationwide but control 25% in Atlanta and 21% in Jacksonville.

A more liquid layer of crypto actually makes it easier for Wall Street to buy out these markets. Tokenization can’t stop corporate landlords; it just builds a faster ledger for rent collection. Crypto here acts as a double-edged sword—completely neutral, not an automatic savior.

Platform models merely accelerate extraction, making it highly efficient and unavoidable. A single anesthesia clinic owned by a holding company is an isolated business. But when one entity buys up all clinics in major metros, the game changes. Coordinating via shared software, corporate owners uniformly raise prices across hundreds of healthcare providers. Individual doctors operate blindly, unaware of the traps. This is old greed operating on a more advanced infrastructure.

Wu is very cautious when defining boundaries. I am less so. The deep mechanisms of these industries reveal a slow process of primitive accumulation within the American middle class. This corporate transformation effectively forces doctors back into standard labor and traps homeowners in lifelong renting.

The platform economy depends entirely on trapped audiences and centralized gatekeeping. But we have a technology designed from the ground up to smash those gates. It empowers individuals with sovereignty to build their own systems, completely outside the reach of exploiters. That’s the real moat.