“Long degeneracy, long hypergambling.” Hyperfinancialization, value extraction, and the degeneration of everything. Are we frontrunning tradfi or did tradfi already frontrun us?
Prediction markets. Everything is a market you can gamble on! This is being framed as something new and revolutionary. I think there is nothing new under the sun. In 2024 it was memecoins. Everything is a token you can gamble on! Everything must be priced, quantified, speculated on, and the value must be extracted. With prediction markets we price and extract value from information. With memecoins we priced and extracted attention.
A common sentiment is that the crypto industry is uniquely extractive and predatory. That we scam suckers and extract value better than anyone else. I’m not sure if that’s true. I think traditional finance does “max extraction” far better and more elegantly than we do. In crypto we just siphon off Fed-printed liquidity from gambling addicts. Traditional finance extracts value from places where we didn’t even know value existed.
This hyperfinancialization and max extraction did not start with “the cryptocurrency industry.” To believe so is narcissism. Traditional finance frontran us decades ago. They have mastered the art of destroying accumulated intangible capital in the name of short-term extraction. Consider:
Boeing
Boeing used to be the pride of America. The crown jewel of our aerospace republic upon whose back we built the greatest empire this world has ever seen. With their bombers we razed Europe and Japan and laid the foundations of our New World Order. With their jetliners we interconnected the world and established the global economy.
Today Boeing is known for stock buybacks and crashing planes. Outsourcing production and cutting costs. The culture of innovation, safety, and engineering excellence is completely gone. Decades worth of institutional knowledge and engineering culture cannibalized in the name of Return on Shareholder Capital. Today their name is all they have left. They are a husk of their former self. They are currently being outcompeted by a French company.*
(*The inflection point is generally understood to be the 1997 McDonnell Douglas merger. Boeing acquired McDonnell Douglas, but culturally it was more of a reverse takeover. The famous quip is that "McDonnell Douglas bought Boeing with Boeing's money." The merged company increasingly adopted the McDonnell Douglas approach: cost-cutting, outsourcing, moving headquarters to Chicago (away from the engineering base in Seattle), and prioritizing stock price and returns to shareholders.)
Oakland Sports
The tragedy of Oakland, and by extension American professional sports. In 2019, the city of Oakland lost both its NBA and NFL sports teams. The Raiders moved to Las Vegas, and the Warriors moved to San Francisco. These teams used to have the best fanbases in America; they used to call the Warriors’ stadium Roaracle Arena, it was the biggest home field advantage in sports, the Warriors won 3 championships there. And at the zenith of their success, they moved.
You hear old dudes talking about how the league was better in Jordan’s day, or that college basketball is better to watch. Maybe they’re just geriatric racist boomers. Or maybe they’re right, and the product genuinely sucks.
Why do people prefer college ball over the NBA? It’s because the fans get active. The energy is infectious. Have you ever been to a football game in Europe? Same thing. It’s electric, mimetic in a Girardian sense. Oracle Arena used to be the same way. Now the Warriors play in San Francisco, their team is mid, their fans are mid, and they will never again reach the success they had in Oakland. But at least everyone involved is rich.
2010s Tech
Do you remember what using Google search was like in the early 2010s? It used to give you exactly what you wanted, like magic. Today in order to find anything useful on google you have to append “Reddit” to every search term, which is itself a cesspool. It’s humiliating. You’re better off asking Claude and hoping it doesn’t just hallucinate.
Same with Facebook and Instagram. We used to use these sites as genuine social media, with pure hearts and clear intentions. Do you remember “poking” people on Facebook? “Like for a TBH?” #ThrowbackThursday and #WomanCrushWednesday on instagram? Can you imagine doing this today in 2026?
The degeneration of these platforms has been covered a thousand times, I won’t bore you with the details.** The ad business cannibalized the product. Google Search got SEO’d into oblivion. FB and IG moved to an algorithmic feed and stopped showing you posts from people you actually follow, etc etc.
I find it more interesting the way that users have adapted to the changing nature of Facebook/Instagram. Facebook is basically only used anymore for its Marketplace function. Personal IG profiles have evolved into carefully curated advertisements aimed at potential partners. Any authenticity is reserved strictly for the Stories. Humans are nothing if not adaptable.
(**Platforms are good to users to attract them, then good to businesses to capture them, then MAX EXTRACT from both once everyone is locked in. In the process, all accumulated intangibles— trust, social capital, brand loyalty— are cannibalized and quantified into market capitalization. Not much more to say.)
What's next?
There are a thousand examples of this. Through the act of pricing these intangibles we destroy their value. Polymarket and Kalshi, and memecoins before them, are just the latest example of this. By financializing information in a prediction market, we pervert the incentives and corrupt the information. By financializing attention and social capital via memecoin, we burn the social capital.
Baudrillard spoke of this in the 70s; culture melting into the economy, everything commodified as sign-value rather than as use-value. The ‘tokenize everything’ theme in crypto is just the logical conclusion of this. These prediction markets are signs that the LONG DEGENERACY trade is currently being priced into the public consciousness.
It’s not fully priced in yet. But it’s been playing out for a long time. There’s an inefficiency here. Maybe it’s time to start considering, when the trend is fully exhausted, how do we short? And what comes next? How can we incentivize value creation again?