If you’re a Central Banker, “Decentralised” is a dirty word.
Cryptocurrencies are decentralised. This means they are copied to multiple locations around the globe- but they can only be accessed by the key holder.
The flaws in the Central Banking system aren’t well known to the general population. It’s a kind of boring subject that we don’t hear about much in the media. We’re generally unaware of the effects that they have on our day to day lives. All we know is that we have to pay more taxes every year and the cost of living keeps rising ahead of wages. We don’t seem to know quite why this is.
Monetary policy is orchestrated by the Central Banks. Governments are their messengers who’s job is to break the news to us. (or keep it from us.) Policies are thought up by economists, academics and civil servants- People who have generally not lived in the real world and who have little to lose by getting their predictions wrong.
Yet we somehow believe it will all get better. The pain since the 2008 crash is only temporary and we’ll get back to prosperity soon without having to think about it too hard. Anyone who has studied the history of central banking knows that it is not a self-correcting entity. The whole idea is based on the flawed premise of a centralised economy. These flaws don’t get better, only worse as there’s no incentive to improve. Politicians get paid whether they screw up or not. Bankers only get more bonuses when things go bad, and on top of that they get a bailout from the taxpayer. Why on earth would they want to rock that boat?
I’m sure the good people in the European Central Bank believe they have the answers. But a market isn’t something you can control- It does whatever it wants. Economics can’t be “fixed” by printing money or tinkering with interest rates. These are short term tactics to delay disaster, but they are not strategies.
What to do?
Blockchain technologies can eradicate most of the costs and delays associated with the current financial system. The world economy loses close to $1 trillion a year through fraud. Cryptos can eliminate most of this due to improved security. Micropayments can empower the creative community. There are countless other applications that can be enhanced.
When will this all happen?
We don’t know how long it will take for mass adoption of this technology, but unfortunately, only a collapse of some kind tends to bring about real, lasting change. When the next big financial downturn comes, cryptocurrencies will have a huge role to play in rebuilding social and economic structures. We only have to look at the situation in Venezuela, Zimbabwe and Cyprus to get an idea of how this can work.