Web 3.0: Red Pill in Style, Blue Pill in Substance

Joshua Adams
5 min readMar 10, 2022

You take the blue pill and the story ends. You wake in your bed and believe whatever you want to believe. You take the red pill and you stay in Wonderland, and I show you how deep the rabbit hole goes. — Morpheus

Fans across the political and ideological spectrum love the Matrix films. Aside from all the philosophical discourse the series have sparked, many have appropriated its arguably most iconic scene: when Morpheus offers Neo the choice between the red and blue pill.

Some might see the Matrix as an allegory for the extractive nature of capitalism, forcing the masses to accept their place as cogs in a machine through manufactured consent. From a different angle, the films show the lies the government, academics and the news media use to shield us from truths that would fundamentally change our understanding of reality: the real shape of the earth, the existence of aliens, who the superior race is, or why the global elites are petrified by Bitcoin, etc. Since the Wachowski sisters transitioned, others see the Matrix as metaphor for the trans-experience. No matter where we land in the world of ideologies, everyone sees the red pill as a metaphor for the liberating and mind-expanding power of the truth.

However, considering the issues of global inequality, political extremism and ecological devastation, why are the world’s best technologists — who likely consider themselves the most red-pilled amongst us — trying to build the Matrix? With ideas like the Web 3.0., aren’t we accepting the need to make a utopian virtual life to exit our real life dystopia; a future that the Matrix warns against?

To be clear, I don’t think most of the big players in tech are bad people or super rich versions of the Architect or Agent Smith. Their aggregate intentions range from utopian ideals to a kind of adventure capitalism, seeking new profits on the frontier of innovative technologies, to extreme cyber-libertarianism. We could try to locate individuals or companies on that spectrum, yet I surmise that that exercise wouldn’t capture the broader context of how techno-fundamentalism (to oversimplify, the idea that our problems are a new technology away from getting fixed) manifests itself in society.

But history has given us plenty of examples of the bad that can come from the Goliath’s of the world thinking they are David. In an interview with New York Mag, VR pioneer Jaron Lanier said “To me, one of the patterns we see that makes the world go wrong is when somebody acts as if they aren’t powerful when they actually are powerful. So if you’re still reacting against whatever you used to struggle for, but actually you’re in control, then you end up creating great damage in the world.”

There very well may be a sincere ethos (particularly talk of the decentralizing and democratizing potential of emerging tech) that informs the “we are going to change the world for the betterment of everyone” rhetoric behind Web 3.0. But to be candid, I think it is outweighed by the magical thinking, cynical advertisement and scamming.

In 2017, former managing director and head of financial markets research at AQR Capital Management Aaron Brown estimated that 40 percent of bitcoin is held by 1,000 users. For an array of cryptocurrency and digital tokens, their creators keep a large percentage before bringing them to the public. According to the WSJ, 0.01% of bitcoin holders controls 27% of the currency in circulation. In a recent study, researchers at University of Technology Sydney and Stockholm School of Economics, they found “at least one pump on 133 days out of the 175 days in our sample, indicating that there is almost one pump per day on average.” According to cryptocurrency investment firm 21Shares, roughly 55% of Bitcoin investors are underwater.

When it comes to NFTs, the authors of “Mapping the NFT revolution: market trends, trade networks, and visual features” found that the top 10% of traders account for the overwhelming majority of assets and transactions. Reported by Reuters, Marketplace had to halt most transactions because of rampant reports of scams, counterfeits and “wash trading.”

There isn’t anything intrinsically worse about the commercialism of the Metaverse than a store carrying fifty types of cheese. People like artists and photographers have made a lot of money selling their work as NFTs. But far from changing the world, I’d argue that Web3 is much more likely to reproduce the unequal economic systems of the real world than to change them.

A major aspect of the disconnect between techno-optimistic pronouncements and material reality is rooted in the inability of the most powerful people in the global economy to conceive and construct a world different than the one they benefit from. As artist Brian Eno articulated, “I can understand why the people who’ve done well from it are pleased, and it’s natural enough in a libertarian world to believe that something that benefits you must automatically be ‘right’ for the whole world.” In Mark Fisher’s “Capitalist Realism,” he writes about how the logic of capitalism is so ingrained — from our macro political-economic systems to our personal daily lives — that we come to believe there is no alternative.

The Metaverse is where several points of my pessimism converge. Even in a new universe — which could be constructed to be (virtually) boundless — Silicon Valley introduced artificial scarcity. Before the vast majority of the world can afford the headsets, smart phones, or other digital technology needed to access even early iterations of the Metaverse, a decimal percentage of global financial elite will have already bought up the majority of prime digital real estate, owned most of the digital currency used for transactions in the Metaverse, and the NFTs that give this dreamscape its art and architecture.

There will be novel experiences in the Metaverse — you can attend a virtual meeting, then open door and jump into Fortnite. Eventually, you may be able to do cool things like jumping from building to building, dodging bullets or dating the woman in the red dress. But the overwhelming majority of users (not speaking of the much larger non-user base) will enter as consumers in a 3D version of the surveillance and extraction economy. To pull from the Matrix and to put it more plainly, they become batteries — minus the evil AI robots. This is the more likely future, one that is about as democratized and decentralized as a Ponzi scheme — or worse. At best, it is shaping up to be as decentralized and democratic as an auction for a Basquiat NFT.

My critical argument against unbounded techno-optimism on things like the Metaverse, AI, cryptocurrency, blockchain, NFTs, Web3, etc. is two-fold: a lack of honest accounting of who the “losers” in this game, economy, techno-universe, etc. will be; and there’s a version of the future that is talked about as if it were inevitable — which obfuscates choices, IRL material realities, and, maybe most importantly, existing power dynamics that remain unchallenged (whether or not these technologies are inherently good or bad).

And I fear that we are accepting a digital world that is red pill in style, blue pill in substance.



Joshua Adams

Joshua Adams is a writer from Chicago. UVA & USC. Assistant Professor at Columbia College Chicago. Twitter: @ProfJoshuaA