I was just reading that Afterpay, a Buy Now, Pay Later company out of Australia has incurred a 350 million mid-year loss, since it was acquired by Square Block last year for 39 billion dollars. Based on the current financials, the estimate was that they overpaid by 23 billion - that's gotta hurt a little.
However...
And as much as I dislike BNPLs as they prey on the financially illiterate end economically challenged, the future of them is actually bright, or at least in some form. The reason is that just like the change in name from Square to Block to "better represent their direction", the direction of financial service is definitely heading digital. But, while we might be more purist in our definition of decentralization, this is what is happening through these companies now, where while the companies themselves are centralized, we are heading into a decentralized of products and services. And these will increasingly encroach on the centralized and controlled forms, including currencies themselves.
This isn't new of course, as this has essentially been happening for years through loyalty points, but now those points are starting to scale and be taken more seriously, as well as getting used by a much wider selection of society. Combined with the increasing push of digital interaction into our daily lives and especially those of our children, and it won't be long until we are living our lives at least semi-detached from the centralized currencies.
For example, I shop at a supermarket in Finland that is owned through a co-op, meaning that the "users" are the owners, at least in some way. How this works is through holding a bank account with them and depositing a bit in and from there, discounts are earned on every purchase through tiers based on monthly spend amounts. However, a lot of companies support this loyalty program, so using those companies (like insurance) earns the points too. These points are actually a percentage of the spend amount and can be spent through a debit card on anything, anywhere, but how much is spent back at the supporting companies?
One of my early jobs was at McDonald's and the staff discount when on shift for lunch was 50% - that is a good deal, but it isn't like they aren't making profit on that as well. The thing is, it is only a "perk" if willing to eat McD's for lunch - which I wasn't. But, many did.
And this is where these new FinTech companies are heading, where they will layer their services in such a way that they will incentivize the places that support them, meaning it is a system of kickbacks for being part of the group. But, what this incestual spending does, is increasingly cuts the fiat currencies out of the markets, bring value to the loyalty point, the tokenized money that can be spent. Well, all money is tokenized - isn't it?
This is the breakaway from the current economy and it should have the supporters of the centralized fiat currencies very nervous. And, while this isn't the decentralization of ownership of currency value, it is a few steps down that path and as the new users become more accustomed to the process, they will look to be part of the ownership model itself, creating full decentralized co-ops that enable them to back and benefit from their own interests.
The inevitability of all of this seems quite high, especially since the decisionmakers of fiat are running into it into the ground ever quicker, as they know it is on the way out. What their plan is now, is to extract all the wealth they can from the current economy and convert it into what will have value in the new economy - assets, property, businesses. They are using us to finance their better position in the "new world order" of things.
But, due to the potential in digital value, we are no longer bound to play their game and take what is handed to us, as we are able to build and scale our own financial services. And as the largest consuming force, squeeze the unhealthy operators out, by lending our support to what supports us. It is very much like that loyalty system with all of the cooperating businesses, except we are the businesses as well as the consumers, creating a circular economy with us holding all positions simultaneously, and no one person or narrow group holding a massive amount more than anyone else.
The centralized economy is fundamentally broken, which is why it is possible to have billionaires worth more than the GDP of mid-sized country economies, or be valued at more than billions of poor people combined. It is broken when the wealth gap is expanding and the group at the top is narrowing. It is broken when it keeps failing over and over, more and more, deeper and deeper and people say - this is just the way it has to be.
That is bullshit.
This is not the way it has to be - that is the way it is engineered to be, because through the common belief that there is no other way, we become powerless in our ability to change it. We know it doesn't work, but what option is there?
That is what we are here to find out.
Despite all the mess, complication and failure - we are moving forward still.
Taraz
[ Gen1: Hive ]
