Moore's Law & Money: Why You Need to Slow Down to See What's Really Happening

In Daniel Kahneman’s book: Thinking Fast and Slow, he talks about two ways that humans engage with their environment through mental processing. Thinking fast relies on an axioms, generally accepted truths, and understandings about the way the world works. I see a red light and come to a stop. Someone waves at me from across the street – I wave back. I get up in the morning and brush my teeth, and so on. There is little if any critical thinking or deep reflection required to conduct many of these behaviours. Activities are conducted almost subconsciously and automatically. Thinking slow requires thoughtful judgement; solving a new case for a client with entirely new information, creating a new product or service that the market has yet to see, learning a new skill or attentively listening to our spouse.

Why is this interesting? We live in a society where we spend most of our time thinking fast, avoiding information paralysis, and relying on our understanding of the way we believe the world works. However, the world is changing faster than we can imagine. In 1965, Gordon Moore, the co-founder of Intel noticed that on average, the number of transistors in a computer chip would double every 1-2 years. It turned out that he was right, and since then we have seen an explosion in computing power in increasingly smaller sized devices. What once would have cost over $1m for a megabyte of storage in the 1970s can be had for less than a dollar today. The pixel density of our screens continues to jump from 240ppi, 480ppi, 720ppi, 1080ppi (HD), 2k, 4k and now 8k. We can look at cameras, cars, batteries, and more technologies across industries and see similarities. While it is true that there are years in between where growth can stagnate and reality represents more of an overlapping S-curve (slow growth > exponential growth > slow growth > new technology > repeat), it is undeniable that we humans are continuously being caught off-guard by the pace of innovation and technology.

The adoption of cryptocurrencies is perhaps the fastest S-curve of any technology seen in history. Still, it is being overlooked. We are quick to dismiss this nascent technology as 'speculative', 'a bubble', 'criminal' and more without spending the time to deeply analyse and understand the underlying technology and why it matters. While clearly the narrative has changed and we are seeing increasing levels of adoption, there is an underestimation of both the applications and disruption to the traditional world of finance and savings that this technology will have on people’s everyday lives. Global adoption of cryptocurrencies is currently around 226m people or 2.8%, that’s up from 100m just 6 months ago. That’s a compound growth rate of over 200% p.a. and we’re just getting started.

With the backdrop of spiraling debt, debasement of currencies and an increasingly connected society reliant on digital technology, are you thinking fast or slow when it comes to crypto?