Blockchain Technology — The Dismantling Of Banks And Governments
In Traditional Finance, Centralization is the deal of the day. Financial activities were either controlled by the Government, banks or financial institutions. These bodies deprive common citizens the power to exercise their economic rights to any means possible; they decide how much money can be spent, how much can be transferred and to some extent they have the power to seize the money a person has in their accounts.
With the power these central bodies have over people’s financial life, it makes it impossible for people to experience financial freedom; the money you spend was created by the Government with the aid of the Central Bank, the money flow is also controlled by them; so where is the freedom?
Another problem with centralization is the fact that it is not available to everyone. A large amount of people has access to the internet, but a lesser amount has unrestricted access to banks, financial institutions and financial services and apps. A lot of countries in Africa and some in Asia do not have access to some financial tools that are available in the United States of America. A good example of this is PayPal.
With the issues that exists with centralization, only one technology offers scalable solution; this is the Blockchain.
The Blockchain Technology provides alternatives that eliminates the cons of the centralized economic system we live in. Also, unlike banks and other financial services that are not accessible by some people in some countries, the Blockchain is universal and can be used by anyone, anywhere and at any time.
For example; Cryptocurrencies offer a scaling solution as to how money should be spent, and this is not in relation to volatile coins like Bitcoin or Ethereum, but to stable coins like USDT or USDC. Stable coins are crypto coins that are pegged to $1, they are less volatile in nature and to most people, they are the Dollars of the Blockchain.
Stable coins are like your fiat currency on the Blockchain, and in many ways than one; they offer some opportunities that you may not get from the traditional finance with your fiat money. For example; with stable coins, you can carry out transactions worth $1,000,000 and pay a gas fee that is not even up to 0.0005% of that amount, you can never get this kind of cheap transaction fee with traditional finance, not to even talk of the speed at which transactions are carried out when using stable coins. As earlier said, not everyone has access to banks and financial institutions, in fact, it is almost impossible for someone to send money to a friend in some third-world countries. With stable coins, you can send any amount to literally anyone on earth (hopefully, very soon we will be able to send money to beings on other planets using the Blockchain technology, but that will be a story for another century), and this transaction happens instantly.
Lastly, with stable coins you can buy and sell cryptocurrencies, stocks, equipment and perform peer-to-peer transactions easily, plus, it comes with more security.
Stable coins/Cryptocurrency are not the only solution that the Blockchain offers, even though it seems to be the major one. Everyday new Defi (Decentralized Finance) protocols are being developed to combat the flaws of centralized finance; with Defi, there is no room for human error or sentiment, Defi operates on a trust-less economy; where users interact with smart contracts and protocols. Also, with DAO’s being created, the blue-print of organizational hierarchy is taking a new structure. DAO’s allows an organization to be controlled by the community/ token holders. The community votes on changes and decide what should be and shouldn’t be done. This is very contrary to the traditional system whereby an organization is controlled by a CEO, a Manager or Board of Directors; DAO’s give the normal people the power to control an organization. This removes any cause for an organization to create selfish policies.
Finally, with the concept of NFT (Non Fungible Tokens); ownership of assets can now be transferred seamlessly without the need of an agent or third-party. All these innovations created on the Blockchain offers alternatives that seem more scalable compared to the traditional system.
With the rise of the awareness on “Blockchain Technology”; people are getting orientated on the need for a decentralized economy. An economic system that isn’t controlled by the Government or Central Banks or some big industrial entities. The Blockchain offers a true democratic system; one that gives power to the people, one that is true and transparent. There will eventually be an uprising of people against the financial system and institutions that govern their lives; and what then would be the fate of these institutions?