I Just Learned About the Lindy Effect

Bitcoin & Crypto
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I was talking to ChatGPT the other night, just casually exploring the idea of Bitcoin going to zero (don’t ask why, dark mood maybe), and it hit me with a concept I’d never heard before the Lindy Effect

if you’re like me, you’re probably thinking WTF is that?
Same here. But damn, it’s fascinating.

The Lindy Effect basically says this:

"The longer something non-perishable (like an idea, book, or technology) survives, the longer it’s likely to survive in the future.”

Not in a mystical way. Just statistically. It’s like time acts as a filter; anything fragile dies early. Anything that sticks around? It’s probably got some serious staying power.

So I started applying that lens to Bitcoin and everything else. :wink:

Bitcoin has been around since 2009. That’s over 15 years. It’s been declared dead like 400+ times by the media, got banned, crashed, revived, got laughed at, pumped, dumped, and still here. Stronger than ever.

According to the Lindy Effect,its survival till now makes it more likely to keep surviving possibly even thriving. Not guaranteed, but more probable. Think of it like this: if a book’s been in print for 100 years, it’ll probably still be in print in another 100. If a meme survives 24 hours, it might live another 24.

The longer something endures, the more time. it has proven itself.

And that changed how I look at Bitcoin. Not just as an asset or speculation tool. But as an idea that’s passed the test of time and keeps doing so every single day.

Now, I’m not saying throw your life savings into BTC. But next time you hear someone say “It’s going to zero,” ask yourself
Why hasn’t it already?
Maybe there’s something deeper going on.

Not a fan of BTC by the way.

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That’s exactly the opposite conclusion in this context of the Lindy effect.

Proponents of btc argue that people will lose trust in fiat currency and hence btc/ crypto currency is the alternative (which in turn makes them valuable).

However, fiat currency is in use since the 13th century. So basis my understanding of the Lindy effect, as explained by Nassim Taleb in Antifragile, future life expectancy of fiat currency compared to btc is much more higher (and in that scenario, makes btc worthless).

PS: I don’t have any opinion on btc or its survival, just sharing my interpretation of the Lindy effect.

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Isn’t 15 yrs a shorter time frame ?

Maybe a century or at least half a century would be a good starting point to consider anything from a survival POV.

As a counter perspective, this is what I found

The Lindy Effect suggests that the longer something has existed, the longer it’s likely to continue existing. However, this principle isn’t always accurate and can be challenged with examples of things that have become obsolete despite being around for a long time. It also doesn’t account for abrupt changes or disruptive events that can quickly invalidate even long-standing entities.

Some examples that demonstrate the limitations of the Lindy Effect:

  1. Technological Obsolescence:
    VCRs:
    For decades, VHS video cassette players were a dominant technology for home entertainment. However, they were rapidly replaced by DVDs and then streaming services, demonstrating that even long-standing technologies can be rendered obsolete by advancements.

Mainframe Computers:
Mainframe computers were once the backbone of computing for large organizations. They were gradually replaced by more efficient and cost-effective technologies like PCs and cloud computing, despite their long history.

  1. Cultural Shifts:
    Physical Mail:
    For centuries, physical mail was the primary form of communication. While still used, it has been largely replaced by email and other digital forms of communication, demonstrating that even a long-established system can be superseded by new technologies.

Print Media:
Newspapers and magazines were once dominant sources of news and entertainment. While they still exist, their circulation and readership have been significantly impacted by the rise of online media.

  1. Survivorship Bias:
    The Lindy Effect focuses on what has survived, ignoring the countless things that have perished. For example, many ancient philosophical texts have survived while countless others have been lost or forgotten.

In essence, the Lindy Effect is a useful tool for understanding the potential longevity of non-perishable things, but it’s not a perfect predictor of future survival. It’s crucial to consider the factors that can lead to obsolescence, disruptive changes, and the limitations of survivorship bias when evaluating the Lindy Effect

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Fiat is Lindy institutionally governments, banks, force.
Bitcoin is Lindy emergently trustless, decentralized, digital-native.

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Agreed.

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Bitcoin’s still standing, yes … but survival alone doesn’t crown it the future of finance. Its valuation remains senseless, driven more by belief than intrinsic function.

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This is what I think, BTW intrinsic function is also pretty good.

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So true, when a lot of people start believing in an idea and keep using it over time, that idea becomes stronger and more trusted. That’s how businesses, books, even religions survive. The longer something lasts, the more people believe it will keep lasting. Bitcoin started as just an idea. But as more people use it and talk about it, it becomes more real. If it keeps surviving, it could become a normal part of life, just like money today.

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That’s how scams work too… Blind belief in something without any logic to back it.

Mass belief (herd mentality) in a business or idea, doesn’t necessarily mean it is right or a great one.

Also, it doesn’t guarantee any longevity for such idea or business. Most such ideas work primarily because of FOMO and greed, rather than any underlying value attached to them.

An idea doesn’t necessarily have to be great one to gain mass validation, all it has to do is ignite the greediness by purporting massive gains/returns.

This is exactly the premise for the launch of meme coins/shitcoins.

Anyways, the Lindy Effect is a nice theory, but our confirmation biases will lead us to interpret it in a way that confirms our beliefs.

PS:
The same craze was there for NFTs, don’t think it’s a thing anymore.

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Bitcoin is largely speculation and tech-driven, especially in its early days and still to a large extent today. That’s a key difference compared to things like religions, books, or traditional businesses, which were built more around ideas, values, or services rather than financial gain. While belief and adoption do make something stronger over time, the foundation matters and Bitcoin’s is deeply tied to profit and technology, which makes its long-term acceptance a different kind of journey.

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I used to talk like this back in 2016 when I heard of Bitcoin for the first time. Maybe you need to know more about the blockchain concept.

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I will definitely go deeper into this insight.

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You are mistaken, i do understand Blockchain as a technology and I’m all for it.

My opinion is just that, not everything that gets built around or on top of Blockchain network, is a great idea or business.

For eg: NFTs and Meme/Shitcoins

1 Like
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I think the author of the post understands this too. he’s likely just framing the discussion in a more engaging way through the lens of the Lindy theory using bitcoin.

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I agree with you, bro. Thats a solid and very reasonable take and honestly its the kind of clarity people lack in crypto space.

You get my point.

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Listen very carefully, i shall say zis only once … :sweat_smile:

Rather than looking at the symptom - Bitcoin’s price trend, let’s look at the root-cause.
A major source of Bitcoin’s value, it derives from trust.

Trust is neither uniform throughout the universe, not constant over time.
High-trust and low-trust societies - Wikipedia.

In a high-trust society,

  • Trust is a commodity, available everywhere, not very valuable.
  • Bitcoin is more expensive to produce than the value of the trust it can offer.
  • Fringe adoption.

In a low-trust society,

  • Trust is at a premium, scarcely available, very valuable.
  • Bitcoin is cheaper to produce than the value of the trust it can offer.
  • Mass adoption.

While there are always “pockets” of high-trust and low-trust constantly evolving around us,
Think of the overall direction in which the world as-a-whole is moving.
IMHO, that is a good predictor of Bitcoin adoption in the long-term.

PS: On the topic of trust,
i find this short interactive-story/game,
extremely thought-provoking and insightful -

Highly recommend spending 15-20mins going through it. :point_up:t4:

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Your insights are deep, and they add a sociological lens to Bitcoin that most price-focused arguments miss. Bitcoin’s value comes from trust. In a high-trust society, it feels unnecessary and in a low-trust society, it’s valuable. Trust is the real signal, not price.

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Indeed.

I loved it, great share.

It was like a life lesson through a game.

Do keep sharing any and all such interesting things whenever you get the opportunity to do so or when no such opportunity arrives, as part of the Good reads

PS:

Loved this one too :joy:

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I don’t trust it, no matter what excuse people come up with to justify.
In a low trust env, i trust it even less. We don’t actually buy or sell stuff in crypto, so much of that environment enables fraud.

We have been in a large scale tech growth environment for many years and also have had a lot speculative/fomo behavior in many different areas over many years ( small scale bubbles perhaps, dunno).

Usually things are cyclical. If the tech space comes in some sort of sustained bear grip ( not saying it will anytime soon), and/or the craziness stops, then we might see how valuable these coins are. In normal cycles itself bit coin has DD approaching 80-90%, what happens if we actually get a bear market ? If it can survive things like that and actually has a useful role somewhere, then maybe i might trust it more.

Gold has lasted longer, id rather trust gold than bitcoin ( but i also don’t like buying hot things unless par of system - so not saying this just because gold is rallying.)

If there was a safe way to trade these coins in India and without overbearing taxation, now that might have been more interesting.

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World keep changing in long timeframe. Maybe its of no physical use for some reason millions are people are paying 85k dollar for a bitcoin.