Cryptocurrencies are kryptonite for big-banks

Global

Photo: Stanislaw Zarychta. Edited by Opulens

DECENTRALISATION. Cryptocurrencies are a vital step forward regarding human progress. Despite different problems, criticism against cryptocurrencies is often missing the point of how cryptocurrencies will improve our world. Thanks to crypto, more people are going to be able to cooperate in communities and conduct meaningful projects in everyday life. 

 

Since the beginning of the 2010s, cryptocurrencies have gained a lot of publicity around the world. It all started with  Bitcoin, a cryptocurrency created as a response to the financial crisis in the USA during 2007-08, that later became a global crisis. But the idea of using cryptocurrencies is much older and dating to 1960s futurist ideas that became popular again concerning Internets development during 1990s. 

For a start, it is important to understand what makes a currency to be a cryptocurrency or “crypto”. Terms as digital and virtual are often used to describe crypto, but there are some fundamental differences. Every cryptocurrency is a virtual and digital currency, but not every virtual or digital currency is a cryptocurrency. 

For example, the Swedish central-bank (Riksbankens) project with the e-crona (e-krona) is an example of a plan for a digital currency but not a cryptocurrency. A cryptocurrency has in the first place to be decentralised, meaning that the cryptocurrency is not governed or supported by a public institution as a government. Another key factor is that cryptocurrencies are depending on how their users and community members are behaving concerning crypto’s usage, social trust and validation. 

Cryptocurrencies are often criticised for different reasons, such as by opinions that cryptos are used for criminal activities, as when it comes to sponsorship of terrorism or trade with narcotics. However, such criticism is very problematic because even “regular cash” as dollars and euros are also used for criminal activities without a higher number of people seriously arguing that (paper) money should be abolished. 

A reasonable criticism concerning cryptocurrencies is that there are several examples of “shitocins”, meaning cryptocurrency projects that are a pyramid-game or scams. It is also a common question to ask what cryptocurrencies even are suitable for in everyday life? 

One example is how people are using crypto as Bitcoin for faster and cheaper transactions without the need to have bank accounts as via Western Union. Other examples are when people are using crypto to buy good and services such as food in restaurants. Such possibilities exist today in the USA, Japan and other places across the world. 

To have a more in-depth understanding of benefits with cryptocurrencies, it is important to understand the ongoing decentralisation trend. Decentralisation today is a transforming and revolutionising trend that will result in different “middle hands” institutions such as banks disappearing or having their roles reduced. One key reason is that more people are going to be able to interplay by “peer to peer” (P2P) interactions where instead of having a company-customer relations more individuals are going to act as involved community members.

Other important aspects when it comes to understanding cryptos are the stories behind different currencies. When it comes to the popularity of Bitcoin, it primarily depends on its storytelling or “hype” about a global revolution. Other and less known cryptocurrency communities and projects are more specialised and aiming for creating functions in certain sectors. This is, for example, the case of Skycoin project aiming to create a decentralised Internet system to prevent censorship and bad governance.

Another example is Manna Base that is aiming to create a global basic income (GBI) system where the GBI could, in principle, go to every human every month. A third and exciting example is Seeds presenting itself as “cryptocurrency for climate” where a whole community of members can get engaged in climate-friendly and regenerative projects via co-creation and democratic governance. Furthermore, community-building around currencies also leads to the creation of new market places and trade between individuals and organisations. 

Cryptocurrencies are still a young phenomenon because the majority of people across the world are still using centralised paper currencies (FIAT). But as time goes one more and more people will use crypto for different needs and interests. Thereby, crypto is about both tech and social transformation leading to behaviours as community-budlings and co-creative processes, as well as towards abolishment of different private and public institutions. 

VLADAN LAUSEVIC

 

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