The future of psychedelics is intertwined with cryptocurrencies and blockchain. Each is a powerful technology. What happens when psychedelics and blockchain come together?

Introducing Cryptocurrency and Blockchain

The technology likely to have the greatest impact on the next few decades has arrived. And it’s not social media. It’s not big data. It’s not robotics. It’s not even AI. You’ll be surprised to learn that it’s the underlying technology of digital currencies like Bitcoin. It’s called the blockchain. Blockchain.
– Don Tapscott in his TED talk, ‘How the blockchain is changing money and business’.

Digital or cryptocurrencies are money redesigned for the internet. Crypto coins or tokens are issued not by any government or institution but by free software that enforces rules, including ones that may limit the supply. An account holder has an address with an associated balance that exists only digitally. Each address is a long combination of numbers and letters operating like an account number, sometimes presented visually like a barcode (a QR code). Each address can send to any other address on the same blockchain almost instantly, with minimal fees. 

There is no central authority. Rather than trust, the mathematics of cryptography secures these processes. To conduct a transaction, you need the key to the address, which acts like an internet banking password. If most of your money is in a bank rather than notes under your mattress, it already consists of an electronic representation. Cryptocurrency builds on existing technology and extends it in new directions.

Bitcoin and Beyond

The first and most famous cryptocurrency is Bitcoin, but there are now thousands of others, sometimes called altcoins, each with a team of programmers working to deliver something of value. Each project attempts to differentiate itself via a focus on speed, capacity, privacy, and so on. This innovation has gone beyond the initial intention of representing money to encompass a range of other applications. 

A blockchain, at its simplest, is a distributed record or ledger of chronological transactions

These other applications use the underlying technology of Bitcoin and other cryptocurrencies called blockchain. A blockchain, at its simplest, is a distributed record or ledger of chronological transactions that is publicly available and verifiable. Its distinguishing features are transparency and visibility. It may not be obvious what is so different about such a thing, but I hope to explain some of the excitement around blockchain below. 

A Small Example

If Twitter were on a blockchain, President Trump would be unable to delete his tweets (he has deleted 431 tweets at the time of writing). Or, if he tried to delete a tweet, anyone would be able to see both the tweet and the act of deletion. No amount of FBI pressure could force a change of the records because the history of that transaction would already be on thousands of machines across the world rather than, as now, in a single place (Twitter’s database) controlled by a single entity (Twitter, Inc). 

Blockchain provides the kind of reliability of record that, like the internet, is designed to survive a nuclear war.

Blockchain provides the kind of reliability of record that, like the internet, is designed to survive a nuclear war. So long as one copy of the dataset survives, it can be verified as an accurate record using an open source computer program based on mathematical principles.

Shipibo-Conibo kené embroideries featuring cryptocurrency symbols for Ethereum and EOS for sale in the Peruvian Amazon. Photo credit: Kent Osborn

Psychedelics and Crypto

To discover what happens at the intersection of psychedelics and blockchain, we do not have to speculate about the future; 2018 saw significant developments.

The Pineapple Fund donates $5 million to MAPS.

The Pineapple Fund donated $5 million and helped raise $4 million more toward the $26.9 million needed for MAPS’s Phase 3 clinical trials of MDMA-assisted psychotherapy for PTSD. 

The Multidisciplinary Association for Psychedelic Studies (MAPS) MDMA Therapy Training Program seeks to train at least 300 therapists before 2021, when we anticipate completing Phase 3 clinical trials investigating MDMA-assisted psychotherapy for chronic, treatment-resistant posttraumatic stress disorder (PTSD). – MAPS

The Pineapple Fund is the project of one person who became suddenly wealthy due to their bitcoin holdings from the earliest days. “Pine” said that they decided to donate $55 million to charity “because once you have enough money, money doesn’t matter.” The Pineapple Fund donation illustrates how crypto can shift substantial power toward those interested to further psychedelic research.

The First Ayahuasca Cryptocurrency: AyaCoin

AyaCoin is an initiative from Tim Gulley, the founder of the AyaAdvisors, an established online platform for user reviews of ayahuasca retreats. It recently ran an initial token offering (ITO) designed, like a more traditional initial public offering (IPO), to raise capital by distributing paid-for shares. AyaCoin hopes to raise $4 million via its ITO to fund a retreat center in Ecuador, purchase land to protect the rainforest, provide a token that is exchangeable for ayahuasca retreats, and donate 5% of income to MAPS. As such, AyaCoin, alongside the MAPS example above, demonstrates the fundraising potential of crypto for large-scale psychedelic projects. 

Investors have little more than the promises of the project team that they will deliver on their goals.

National and international authorities heavily regulate IPOs for good reasons. By comparison, an ITO or ICO (initial coin offering), being new, is subject to relatively little regulation. Investors have little more than the promises of the project team that they will deliver on their goals. As with crowdfunding platforms Kickstarter and IndieGoGo, failures can be significant, and there is little recourse for those affected. One headline warns that a “New Study Says 80 Percent of ICOs Conducted in 2017 Were Scams.” As ever with psychedelics, there is the need to balance vision with practicalities, head with heart, and heaven with earth. Buyer beware.

Criticism of Blockchain

Blockchain is not a magic pill to solve all social and technical problems. Below, I address some common criticisms of blockchain. Enthusiasts accuse such criticisms of spreading FUD (“Fear, Uncertainty and Doubt”), so I aim for a balanced perspective. 

  • The “mining” process of paying computers to maintain the network of a blockchain requires prolific energy usage. Solutions to that are already on the table
  • The volatility of the price of cryptocurrencies is of great concern to many. Although a recent report had a headline “Bitcoin price ends September at lowest volatility in 15 months,” stability remains an issue with recent drops to new lows across most cryptocurrencies.
  • No one in the crypto community will forget what happened to Mt. Gox, one of the earliest and largest services where you could exchange fiat currencies such as dollars for cryptocurrencies such as bitcoin. In 2014, hackers stole 850,000 bitcoins, currently worth around $3,300,000,000. Trust me, that’s the right number of zeroes. Now and again, another hack happens. The answer remains simple: Hold any significant cryptocurrency at home, not in online exchanges. 
  • It’s clear that many apply blockchain where its distinguishing features are not needed, owing to the hype. This hype is like companies adding “.com” to their names back in the 90s hoping for a spike in their valuation.
  • Undoubtedly, some use cryptocurrencies for unlawful purposes, such as money laundering, recreational drugs, child pornography, and terrorism. In that regard, crypto is just like regular money. Pornography has driven the adoption of many past technologies, such as video players and virtual reality headsets. The use of crypto for the above purposes is one of few current areas that involve the exchange of crypto for real-world goods and services. Recreational drugs have been made safer by eBay-style sites like Silk Road that provide a degree of anonymity and extensive customer reviews. If crypto proves useful in these areas, it can expand into other areas just as previous technologies have.

Electricity demands, price volatility, thefts from exchanges, inappropriate application, and illegal activity are all real problems. Still, my plea is that whenever you encounter an entrenched criticism of crypto or psychedelics, reflect on the author and the publisher of that criticism. Whose interests do that author and that article serve? Are these interests compatible with yours and those for whom you care? There are vested interests that do not want psychedelics to succeed, and the same goes for blockchain.

Amara’s Law Applied

psychedelics may dismantle the very idea of mental health by showing more people, through direct experience, that you cannot separate the mental from the body and the soul, and that a health metaphor based on materialism is an inadequate model. 

Amara’s law, named after a renowned technologist, proposes that we overestimate the impact of new technology in the short-term and underestimate it in the long-term. I also suggest that the long-term effect of new technology is not linear. For instance, within my field of psychotherapy, some think that psychedelics have the potential to make great leaps forward in the field of mental health. I argue instead that psychedelics may dismantle the very idea of mental health by showing more people, through direct experience, that you cannot separate the mental from the body and the soul, and that a health metaphor based on materialism is an inadequate model. 

Another pertinent example is that complaining about the volatility in the conversion rate between a dollar and a bitcoin omits the crucial fact that bitcoins are a new kind of asset, with possibilities far beyond what the dollar, for instance, can do. It is the uniqueness of blockchain tokens and economies that will provide the most significant changes, in ways that are hard to imagine. It will take us, as a society, a while to get our heads around the conceptual differences. This lack of conceptual grasp is the reason we underestimate its long-term effects.

Uses of blockchain already available include generating and owning your own money, providing zero transaction fees and instant transfer of assets across international borders, creating a new model for raising capital, the option of true anonymity in transactions and solving the ad blocker problem for content-focused publishers. Looking to the future, possibilities of blockchain include decentralized currency and stock exchanges, addressing the economic crisis in academic publishing, tracking voting with intrinsic protection against hacking (with solid counterarguments), providing end-to-end transparency on charity spending and ensuring diamonds are verifiably conflict-free.

Psychedelic-Informed Development of Cryptocurrencies?

Crypto has already made a significant difference to the landscape of psychedelics. My educated guess is that personal use of psychedelics inspires many of those leading the development of cryptocurrencies such as Ethereum.

The future

Treated individually, psychedelics and crypto are each changing the world, and each demonstrates significant potential for the future. The more interesting question remains: What will they do together?

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