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How Blockchain can Address Wealth Inequality

By February 4, 2020February 20th, 2021No Comments

Bitcoin is more than electronic money. It’s more than technology. It’s digital egalitarianism.

Whoever Satoshi Nakamoto is/was/, the creator of Bitcoin made it clear that releasing Bitcoin into the wild was financial activism. The institutional malfeasance that brought about the subprime mortgage crisis in 2008 was the case in point for the Bitcoin thesis.

As activism, Satoshi didn’t organize a protest, a boycott, or simply make a philosophical statement with Bitcoin. Satoshi gave us a tool that if used correctly can address the root problem behind corruption and economic inequality, which is simple human greed.

Ironically, the ingenious gamification of human greed is the very thing that makes Bitcoin work at all.

In the Bitcoin protocol, self-interest isn’t denied or smoothed over, it is anticipated and leveraged as an incentive mechanism that results in the one feature of Bitcoin that is truly world-changing – the ability to transact value with another person anywhere in the world in a trusted and transparent environment without the need for a 3rd party person/server/institution to verify anything.

Consequently, the power of blockchain technology to remove layers of middle-men, red tape and bureaucratic sludge has catapulted the once fringe geek fetish into a massive transformative catalyst that is redefining industry and capital to the tune of billions of dollars of investment and infrastructure build-out.

As far as impact investing goes there is no other technology that holds as much promise as the blockchain to begin breaking down barriers to wealth inequality.

Decentralized blockchain networks for transmission of digital currency require only a software wallet and as most digital wallets are mobile friendly you then have what amounts to a bank in your pocket.

Blockchain micro-lending apps currently deployed in Southeast Asia are helping a portion of the 1.7 billion un-banked people in the world build an auditable credit history on the blockchain.

In Venezuela a digital currency issued by the government called the “petro” was deployed to assist roughly 400,000 Venezuelans fleeing economic collapse when Socialist policies resulted in the national currency being devalued by 95% in 2018.

Bitcoin charity organizations in Kenya are helping people get access to clean water and receive direct payments for food, school tuition and essential living expenses.

As we witnessed in 2017 entrepreneurs discovered the power of blockchain technology to connect directly with the public for fundraising with Initial Coin Offerings or ICOs.

ICOs introduced blockchain to the world of finance. The ICO experiment as flawed as it was in many respects did in fact prove to the world that blockchain technology was a viable tool for peer-to-peer fundraising and that a good deal of time and cost prohibitive bloat inherent in traditional fundraising models could be done away with. As a proof of concept for blockchain based finance the ICO was a smashing success.

Since 2017 the ICO model has shifted into digital securities and assets. With regulatory safeguards and lower barriers to entry early stage ventures can get up and running quicker and avoid the cumbersome and expensive IPO model.

The ability to tokenize and portion out ownership of any asset class, such as real estate, art, etc., has opened up financial opportunities for middle and lower class consumers that have traditionally been impossible.

Digital securities pioneer and founder of digital securities platform DealBox, Thomas Carter has this to say on the potential of blockchain technology to address wealth inequality:

“Massive amounts of underutilized capital and liquidity is being unlocked in capital markets thanks to Bitcoin and blockchain technology. Never before in the history of human society have we had a mechanism that allows people to send any amount of money across the world in a matter of minutes without gatekeepers enriching themselves on an arbitrage of trust. The decentralization, transparency and trustless nature of the blockchain paradigm is a white-hot current coursing through the circuitry of stale and stagnant modes of finance burning away excess and forging new paths of prosperity and opportunity for everyone”

Thomas Carter, founder and CEO of DealBox, Inc; read about Thomas: “This FinTech Veteran Is Making Cryptocurrency Startup Funding Legitimate“; connect on LinkedIn and Instagram.

Thomas Carter

Author Thomas Carter

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