Crypto Is An Invaluable Tool In The Fight Against Financial Oppression
Crypto has proven itself to be much more than just a hot investment. Indeed, some say it’s poised to play a critical role in the future of finance
Money, as we know it, has evolved from its earliest form of clay tablets and precious metals to coins and banknotes and most recently, digital bank balances. So, will crypto become the next progression in the history of money?
There are reasons to think it won’t. Governments across the world have plenty of motives to want to defend the status quo, which ensures state-backed institutions have a complete monopoly on everything that makes the economy go round – namely printing money. Yet, crypto has several characteristics that have so far prevented governments from keeping a lid on it.
Crypto promises to put economic control back into the hands of the masses because it is built on an open, global network that doesn’t recognize any national borders. With crypto, people can transact on a shared network in the same way they can communicate with people anywhere in the world on the internet. Better still, these networks are beyond the control of national governments and have so far proven impossible to shut down. This principle was designed by Bitcoin creator Satoshi Nakamoto and is designed to create more open markets and promote financial freedom for all crypto users.
Prior to the invention of crypto, financial freedom was limited to the trust people have in their governments and respect for the rule of law. Crypto makes it possible for anyone to grow their wealth without worrying about the intervention and seizure of their assets by third parties such as a bank or the government.
Another benefit of crypto is smart contracts. Previously, contractual agreements were governed by laws, which meant people couldn’t always be confident that the courts would enforce them. With smart contracts, agreements are no longer enforced by courts but by the blockchain.
Furthermore, crypto is anonymous. It doesn’t matter if it’s Bitcoin or Ethereum or Fantom or Avalanche or some other network. Crypto doesn’t give a damn whether you’re white or Black, Hispanic or Asian. It doesn’t care about your gender, your religion, or your political views. That compares to the existing financial system, which in some countries is inherently biased towards people of certain creeds and dispositions. With crypto, all anyone needs is a smartphone and an internet connection and they can download a mobile wallet and get paid in tokens, buy them and sell them, participate in decentralized finance, and more.
A final characteristic of crypto is its mobility, a key component of economic freedom. Users can send any amount of Bitcoin to anyone, anywhere in the world, and they can fly from San Francisco to Tel Aviv with millions of dollars worth of funds without having to inform anyone or declare anything. As a result, crypto significantly reduces the barriers to emigration, boosting economic freedom.
Decentralization Means Freedom
The economic freedom promoted by crypto has given cause for concern. In the wake of Russia’s invasion of Ukraine, some observers have suggested crypto could give Vladimir Putin’s government a way to mitigate international sanctions. Others have warned that criminals are undoubtedly using cryptocurrency to launder the proceeds of crime or fund terrorism around the world.
Those fears may be grounded in truth, however, it could be a price worth paying for the freedom from financial and political repression, surveillance, and deplatforming that crypto also enables.
The unique characteristics of crypto mean that it is, to all intents and purposes, resistant to censorship. That means the government cannot control or monitor people’s financial activity or prevent them from accessing their funds as they can in the traditional banking system.
A good example of this occurred in Nigeria in 2020, when protests erupted against the government in its largest city, Lagos. The population was protesting against the illegal actions of a police force known as the Special Anti-Robbery Squad (SARS), which became infamous for police brutality. The government attempted to clamp down on the protests by suspending the bank accounts of key leaders in the movement. However, they immediately turned to cryptocurrency, in particular Bitcoin, to raise funds to sustain their movement, which ultimately caused the government to disband SARS.
The event was no flash in the pan. Usage of Bitcoin in Nigeria and other African nations has grown rapidly as an alternative to the traditional day-to-day banking system. That’s because anyone can use Bitcoin, and its transaction fees are minimal compared to the charges people face for using traditional systems.
Nigeria’s Central Bank has been far from enthusiastic about the population’s embrace of cryptocurrency and in early 2021 issued a ban on banks and financial institutions dealing with digital money. However, Nigeria’s young and tech-savvy quickly found a way around the ban, using peer-to-peer trading services to buy cryptocurrencies and cash out without using traditional banks. In May, Nigeria’s Securities and Exchange Commission did an about-turn, publishing a set of regulations around digital assets in an effort to find a middle ground between an outright ban and the unregulated use of crypto.
The experience of Nigeria is not unique. In Belarus for instance, President Alexander Lukashenko also tried to use the monetary and banking system to silence his critics following disputed elections in 2020. Protestors flooded the streets of Minsk and other cities following Lukashenko’s apparent win, and leaders soon found their bank accounts were frozen. Yet they continued raising funds for their protests with crypto, with one fund called BYSOL reportedly netting over $2 million worth of donations in a month.
Crypto has value beyond funding protest movements though. It can also serve as a replacement for cash, which is seen as an essential ingredient of financial freedom because it allows for anonymous transactions away from state surveillance. Unfortunately, cash is in terminal decline in many parts of the world. In China, for example, the government has pressed its citizens to replace cash and use digital apps for their day-to-day payments instead. While such apps may offer more convenience, they also give the government much greater control over people’s finances, and the ability to cut off someone’s access to payments, credit, and savings for any reason.
Cryptocurrencies Are Allowing For Economic Independence
In the world of decentralized finance, this kind of financial deplatforming of government critics becomes impossible. With new cryptocurrencies such as Verse, the utility token of the Bitcoin.com ecosystem, anyone can access a full ecosystem of decentralized finance services that are beyond the control of any government entity.
Bitcoin.com provides users with a non-custodial multi-coin wallet that only they can access, meaning no one can freeze or seize their crypto assets. Users of Bitcoin.com’s ecosystem of products and services will not only earn Verse tokens for doing so but also unlock various rewards and DeFi services.
For example, holders of Verse can provide liquidity to the Verse DEX, a decentralized exchange, in return for earning a share of the trading fees on that platform. They can also stake Verse tokens for rewards, and access other services that allow them to lend and borrow cryptocurrency. In other words, Verse and Bitcoin.com provide access to a comprehensive, alternative banking system that no government can control.
Crypto ecosystems have already thrived where there’s a need. Take Venezuela, where thousands of merchants began using the Dash cryptocurrency in the wake of hyperinflation that rendered the national currency, the Bolivar, virtually worthless. It’s a similar story in Afghanistan today. Since the Taliban swept to power last year, the country has been almost completely cut off from the international banking system. As a result, many Afghans have turned to crypto to send and receive money from abroad and also for their everyday transactions.
The takeaway from all of this is that crypto can and will play a fundamental role in enabling greater economic freedom all over the world. With crypto, people have an alternative to the traditional banking system that’s immune to political oppression. It has shown it can help to build better-functioning economies in countries with runaway inflation, making it easier for people to transact, protect their wealth and perhaps even emigrate to a better life.