Cryptocurrencies are an important aspect in the society’s development. People don’t really feel that virtual money promotes important ideas because of the speculators’ hype. It supports the concepts of free enterprise and social justice, caused by the market’s reaction. Unfortunately, neither virtual money enthusiasts nor their opponents notice their important humanitarian aspect.
Bitcoin and the economy
Bitcoin and cryptocurrencies in general are topics that divide any group into warring parties. And it’s not about debating the legal status of virtual coins. Rather, it concerns the strange, illogical, impulsive behavior of many “cryptocurrency enthusiasts”. Typical James or Michael from your office, if he is a fan of digital money, surely annoys you talking about bitcoin, which is “our future”. And he is waiting for all Ethereum holders will sell it to collapse the price. And that is the moment he will buy it, so that after some time he will get incredibly rich on the unreal growth of its value.
Do not react to this sort of things. Bitcoin and blockchain are much more important for the financial world than it seems, if you look at them not from the James’ point of view, who is dreaming of being a cryptocurrency billionaire, but from the perspective of economics and society in general. It must be understood that all bitcoins’ and its alternatives fans are speculating on coins at their own risk. They screw it up by spontaneous and emotional actions, which are increasing fluctuations in prices for cryptocurrencies. But their very appearance means a different philosophy of money than it has been before.
Blockchain technology has a potential to launch a revolution in the world of money and trade. After all, decentralized payment systems create a confidential environment for parties that stay unknown. There is no need for intermediaries that frees up capital for reinvestment in production and in the core activities of the company. First of all, we are talking about banks that have been leeching off of business profits for a long time, offering outdated and expensive solutions for managing financial flows. In the future, radical decentralization of banking will lead to the restructuring of the market, to the elimination of the need for banks to do business.
Discussions about cryptocurrency will soon change
It is time to move from emotional and prejudiced discussions of bitcoins and other virtual currencies to rational and thoughtful. Now there are many strange terms and jargon in blogs and social networks. “Hodl”, “bulls”, “bears”, “tulip mania”, etc. These are all metaphors that hide the true state of affairs and intimidate professionals. Such emotional words give the impression that the cryptocurrency sector has become a kind of ideology, worship and not a financial and technological innovation. Because of this, the big shots of the financial world are still shunning the digital currency industry.
Bitcoin in the Third World
There is one more side concerning the world of cryptocurrencies and blockchain, which everyone forgets. It is the concept of voluntary exchange, which is called “agorism” (comes from the classical Greek word ἀγορά (agora) referring to an open place for assembly and market in a πόλις (polis, ancient Greek city states) It is able to jeopardize the functioning of the repressive, bureaucratic governmental machinery and free entrepreneurs from paperwork. And for individuals blockchain is useful for saving assets, when the state tries to forcibly take them away.
An example is Venezuela that has been in the permanent financial crisis since 2013. The level of inflation there reaches 18 000%, inhabitants lack even the basic products like bread and gasoline. And there are so few medicines that people spend hours in the queues at the pharmacy or for a doctor’s appointment to get a delay in getting it. There is nothing but empty promises that people get.
President Nicolas Maduro and his colleagues blame the United States and “imperialism” for problems in the country. But the real reason for the long-standing crisis is clear: this is the lack of a free market economy. The state there controls almost all enterprises, and private capital considers as a threat.
Against this background, the number of miners and holders of virtual currencies is growing, who become relatively rich in Venezuela. When the state is unable to get working capital, small business is able to develop quite fast.
Thus, such poor countries like Venezuela are a typical example of how cryptocurrencies can help people overcome a humanitarian and economic disaster; create an analogue of free market relations even in a totalitarian country.