Self-Motivation
David Goggins
Former Navy Seal
Career Development
Bryan Cranston
Actor
Critical Thinking
Liv Boeree
International Poker Champion
Emotional Intelligence
Amaryllis Fox
Former CIA Clandestine Operative
Management
Chris Hadfield
Retired Canadian Astronaut & Author
Learn
from the world's big
thinkers
Start Learning

The invisible use case that should define the crypto movement

  • The image of cryptocurrency tends to focus on privilege and flaunted wealth.
  • Financial institutions dismiss Bitcoin as a fad, while exploiting the benefits of the underlying technology for themselves.
  • But the story in developing countries paints a different picture – one of vast potential.

In 2018, The New York Times published a comprehensive expose on the burgeoning crypto movement that detailed the luxurious lives of the newly crypto rich. The article, aptly titled, "Everyone is Getting Hilariously Rich and You're Not" is emblematic of the coverage that often typecasts crypto enthusiasts as amateur wealth connoisseurs.

It's a common storyline about crypto diehards that is imminently popular because of the ostentatious numbers and the perceived greed of the whole thing. For example, when Ripple surged in value by more than 1,240% in a month, the headlines often reported on the company's CEO, Chris Larsen, who briefly became richer than Mark Zuckerberg.

The notion that a few people, 4.11% of Bitcoin owners to be exact, are becoming incredibly wealthy from the crypto movement only perpetuate the idea that cryptocurrencies are about becoming fabulously wealthy.

Of course, this penchant for discussing privilege has created a limiting narrative that propels skepticism about the transformative potential found in cryptocurrencies.

More specifically, continuing narratives about the culture of privilege surrounding cryptocurrencies is a distraction from what should define the primary use case for the crypto movement.

The skepticism of financial institutions

While traditional financial institutions are happy to benefit from Bitcoin in the form of derivatives contracts bought and sold through their institutions, they are continually dismissive of the crypto movement.

Most famously, JP Morgan Chase CEO, Jamie Dimon, described Bitcoin as a "fraud," adding that it's a good option for murderers and drug dealers.

Meanwhile, Bill Harris, the former CEO of PayPal, described Bitcoin as "a colossal pump-and-dump scheme...best suited for one use: criminal activity." Similarly, billionaire Charles Munger, vice chairman of Berkshire Hathaway, explained that he "detested it the moment it was raised."

Moreover, Bank of America has expressed continual incredulity about crypto's underlying technology, the blockchain, even as they rack up the most patents for the technology.

To be sure, financial institutions have every reason to prevent the proliferation of cryptocurrencies. Not only do they circumvent their once-unchallenged grip on the monetary system, but these institutions, and those who run them, have little use for an alternative to the existing financial infrastructure.

Simply put, the incredulity the financial elites feel is self-serving at best. Not only do they sit in powerful positions that prop up their privilege, but their access to vast financial resources encourages them to be dismissive of a new asset class that serves less well-positioned people.

Creating Financial Inclusion

With all this noise, an important expression of the crypto movement is struggling to breakthrough. For some, cryptocurrencies are just a modern way for a few people to become incredibly wealthy, while others see it as a threat to their business model and bottom line.

However, for many others, cryptocurrencies are a savior, a crucial way of exchanging value in turbulent and unstable situations. In between the headlines and hot takes, cryptocurrencies are making a real difference in the lives of the unbanked, those living in developing countries, and those impacted by geopolitical turmoil.

While Facebook's highly touted Libra is yet unproven, the purpose is right on the mark. The currency is targeting the worlds' 1.7 billion adults who don't have access to the financial system. In the US alone, 25% of the population is considered unbanked, meaning that there is a significant need for a better option.

Therefore, tech titan IBM notes, "we have reached a tipping point in the banking industry where our relationships with banks and how they extract value from us is going to be transformed."

For a lot of people, that transformation is already taking place. In Venezuela, where the national currency's annual inflation rate is 1.7 million percent, cryptocurrencies are allowing people to buy things like food, milk, and housing. As Venezuelan economist, Carlos Hernández, wrote in a Times op-ed, "'Borderless money' is more than a buzzword when you live in a collapsing economy and a collapsing dictatorship."

Indeed, cryptocurrencies effectively combat inflation, corruption, and high remittance costs. With cryptocurrencies, people aren't dependent on financial elites or established organizations to provide relief or opportunity. They can create this for themselves.

Creating new opportunities for entrepreneurs

Beyond the use case of blockchain as cryptocurrencies, the open, censorship-resistant nature of the technology has fostered a startup culture that's positively buzzing with innovation, the benefit of which isn't just limited to wealthy hubs like San Francisco and Singapore.

For example, Matic Network is an Indian company that is rapidly becoming the base protocol of India with its fast, scalable second-layer solution for Ethereum. Whereas Ethereum has struggled to scale beyond around 15 transactions per second, Matic uses side-chain technology to scale up to 65,000 transactions per second.

The company has already established partnerships with well-known names in the blockchain space, including Binance and Coinbase Ventures. As a development platform, Matic provides ready-made infrastructure to help kickstart the Indian blockchain startup scene, encouraging tech entrepreneurs to bring their applications to life

Despite its status as a developing country, India has long been the IT outsourcing hub of choice for companies the world over and contains a wealth of programming talent.

.

Open source, shared benefits

For the many people who won't become Bitcoin millionaires and who aren't members of the financial elite, cryptocurrencies and blockchain are becoming a vital resource that levels the playing field, inviting total participation in a trustless economy that has a place for everyone. Furthermore, the low barrier to entry for building blockchain-based applications offers the potential to open new channels for entrepreneurship in developing countries.

LIVE ON MONDAY | "Lights, camera, activism!" with Judith Light

Join multiple Tony and Emmy Award-winning actress Judith Light live on Big Think at 2 pm ET on Monday.

Big Think LIVE

Add event to calendar

AppleGoogleOffice 365OutlookOutlook.comYahoo

Keep reading Show less

Neom, Saudi Arabia's $500 billion megacity, reaches its next phase

Construction of the $500 billion dollar tech city-state of the future is moving ahead.

Credit: Neom
Technology & Innovation
  • The futuristic megacity Neom is being built in Saudi Arabia.
  • The city will be fully automated, leading in health, education and quality of life.
  • It will feature an artificial moon, cloud seeding, robotic gladiators and flying taxis.
Keep reading Show less

Study details the negative environmental impact of online shopping

Frequent shopping for single items adds to our carbon footprint.

A truck pulls out of a large Walmart regional distribution center on June 6, 2019 in Washington, Utah.

Photo by George Frey/Getty Images
Politics & Current Affairs
  • A new study shows e-commerce sites like Amazon leave larger greenhouse gas footprints than retail stores.
  • Ordering online from retail stores has an even smaller footprint than going to the store yourself.
  • Greening efforts by major e-commerce sites won't curb wasteful consumer habits. Consolidating online orders can make a difference.
Keep reading Show less

The key to better quality education? Make students feel valued.

Building a personal connection with students can counteract some negative side effects of remote learning.

Future of Learning
  • Not being able to engage with students in-person due to the pandemic has presented several new challenges for educators, both technical and social. Digital tools have changed the way we all think about learning, but George Couros argues that more needs to be done to make up for what has been lost during "emergency remote teaching."
  • One interesting way he has seen to bridge that gap and strengthen teacher-student and student-student relationships is through an event called Identity Day. Giving students the opportunity to share something they are passionate about makes them feel more connected and gets them involved in their education.
  • "My hope is that we take these skills and these abilities we're developing through this process and we actually become so much better for our kids when we get back to our face-to-face setting," Couros says. He adds that while no one can predict the future, we can all do our part to adapt to it.
Keep reading Show less
Personal Growth

Childhood sleeping problems may signal mental disorders later in life

Chronic irregular sleep in children was associated with psychotic experiences in adolescence, according to a recent study out of the University of Birmingham's School of Psychology.

Scroll down to load more…
Quantcast