Blockchain: Open Source Money

“Blockchains are simply distributed transaction processing engines. The technology allows data to be stored in a variety of different locations, while tracking the relationship between different parties to that data. Most people who try to explain blockchains like to compare it to a ledger. Any time someone makes a transaction, such as a currency changing hands or a new device being added to a network, it is recorded in the chain and anyone can track what happened.That’s why law enforcement is so eager for Bitcoin – the digital footprints are easy to track. “ Fortune tech, Stacey Higginbotham, May 29, 2015

What if we lived in a world where global access to money was available to all? With the speed of digital around the world, money can zoom in as a peer-to-peer decentralized and collaborative process – no top-down banking system needed. Trust relationships happen automatically through digitally signed, unauthorized transactions, destroying the inevitability of poverty. Would that represent a giant step for humanity?

This is the utopian dream of technology developers. The next generation of computer networks is getting ready to surround the world for good. Welcome to the planned blockchain (financial) transformation of the world.

Ignore it at your own risk.

My May 2016 article, The power behind the throne, discusses the mostly underreported, yet steady progress, toward a cashless society via blockchain technology, and my thoughts on who really benefits. It could end up as the giant leap for the banking industry, to gain almighty control over our financial transactions. A Bloomberg article, Inside the secret meeting where Wall Street tested digital cash, May 2, 2016, cited representatives of Nasdaq, Citigroup Inc., Visa Inc., Fidelity, Fiserv Inc., Pfizer Inc. and others who were present.

Enter 2017 and the documentary produced to inspire and excite: The Blockchain and Us. Some say that 2017 will be the year that this technology moves into the mainstream; others say it’s just too risky.

The information-advertising-type documentary introduces “leaders” from countries around the world who glorify the virtue of open source money, the grassroots level, and the upside-down cultural game changer launched by Bitcoin in 2008. Blockchain technology and its potential impact are compared to how the launch of the aircraft has changed society; the structure of the financial services industry alone, is said to transform 100% to digital within 20 years. In addition, blockchain technology is expected to:

  • Influence each industry as a “value” platform with military grade cryptology
  • Create a generational shift in technology, an opportunity capable of “lifting people out of poverty”
  • Accommodate what they called “smart” contracts
  • Make a profound shift in how the Internet can be used to create new forms of value and new ways of trading value
  • Generate more jobs as a result of automation

There you have it … Blockchain and us. But no-seers, like me, cannot see the proportionate personal benefit. Does the meager financial privacy we have left over to the Goliath banking industry through cash? It occurs to me that we may not have a choice, since the “small” people are apparently the income units that are simply together for the ride.

That said, using cash and paying as you go has obvious and perhaps not-so-obvious benefits:

  • Choice
  • Transaction privacy
  • No bank interest charges (bank overdrafts, credit cards, loans, credit lines, etc.)
  • Possible 5% seller discount on request
  • Fiscal liability that destroyed credit usage
  • Limiting the instant gratification mindset encourages easy credit
  • More personal time when dealing with debt means working harder / faster

I think life in a material world makes it easy to forget that the full definition of wealth includes more than accumulation. The intangible wealth of personal well-being and peace of mind is invaluable until it is overlooked and undervalued. Instead of the utopian dream, imagine it: We no longer make purchases that we do not need, with money we do not have to impress people who do not really care about us. If more people would make a habit of using cash, we could strengthen our own money management skills to build real wealth, and also send a message to those who own the gold.