Sometimes to see where things are going, we have to look back at where they were. When we try to project the impact of cryptocurrency, it is vital to focus upon parallels.
Probably the greatest example of decentralization comes from information. It also shows how abundance is achieved.
For much of history, information was centralized. This allowed for a few entities to control it all. This all changed with a couple major events. When we look at the lessons, we see how the financial world is about to undergo a massive shift.
It is going change humanity forever. There is little that will rival this when we finally see how far the tentacles go.
Roughly 700 years ago, information was very rare. The largest library in the world has a few hundred manuscripts. Reproduction was slow, done mostly by religious orders where the knowledge of reading and writing was contained. Most of humanity was illiterate.
A couple hundred years later, Guttenberg came along and changed the entire system. Within decades libraries popped up all over the developed world. The reproduction of books made information abundant, at least in comparison to what preceded it.
Of course, this was not without backlash. After all, this made the production of information a lot more accessible The risk was that people could publish anything, even if it was heresy. Notice how the argument has not changed.
For the next 500 years, things stayed pretty much the same with information. We sped things up with faster transport but that is about it. We got the next major change in the 1990s.
The Internet provided another accelerant with information which also led to abundance. Suddenly, even if something as rudimentary as email, we were able to duplicate and share information at speeds never seen before. Basically anyone with an Internet connection was creating content.
Ultimately, this led into the creation of YouTube, which allowed anyone to post videos, mostly of cats in the early days. Nevertheless, this took the concept of video creation into the decentralized realm.
Eventually we saw the power of broadcast television diminish. For much of the last decade, people started to "cut the cord". This led to alternative forms of information sources arising. With the Internet, abundance is the norm.
Money, with the exceptions of a few isolated times in history, was always centralized. For centuries, it resided with the state, usually under the from of a monarchy. Over the last couple hundred years, this shifted to the banking system. Today, most of the major currencies are in the hands of the banks. They are the ones responsible for the creation and destruction of the money supply.
This puts the power in the hands of relatively few people. Over the past 70 years, the Eurodollar system comprised of a few hundred banks. That is a rather small number compared to the population of the planet. Just like with information in the early days, we see how this scarcity caused a great deal of problems.
The key to focus upon is scarcity. With that comes restricted growth. Each of us knows this when we look at our own lives or businesses. We know that if we have 2 or 3 times the money, we could accomplish a great deal more. Unfortunately, money doesn't come out of thin air. Or does it?
Money is a concept we created. For this reason, it evolves and adapts as we see fit. It appears the most logical iteration that we are entering is the decentralized phase.
Of course, just like with information, there is resistance. In the early days, the religious orders were not fond of the printing press. With the Internet, governments fought against the idea of commercial encryption (still do). We also see how a host of players are rejecting the idea of cryptocurrency.
Today, we look back at the age of newspapers, filing cabinets, and snail mail with a hint of laughter. In comparison, that seems so archaic. And it was.
We see how much more advanced the system is today that we utilize. Everything sped up and operates at a fraction of the cost with regards to both information and communication.
In a few decades, we will reflect upon our present monetary and financial system with laughter.
We are doing more than just decentralizing money. Instead, we are redesigning the entire monetary structure. This is what happened with the Internet. The days of Rather, Brokaw, and Jennings are long gone. We have a completely different flow of information, something that was not present 30 years ago.
Nobody today would claim that we need broadcast television to get information. It simply is not required. The service they provided is obsolete. Sure, some still tune in but those people are dying off. At this point, it is a generational thing.
The same holds true with banks. Blockchain already operates as a payment system. Hence, value can be transferred via peer-to-peer transactions. That leaves us with lending and credit. Of course, part of the new monetary structure is the reworking of that.
At this point, we are still in the early stages. Sure, by the early 2000s, the spread of print information changed completely. Yet, video was still operating in the same manner. It took another decade of YouTube and camera advancement (along with more bandwidth) to alter that.
We are at the same point with cryptocurrency. We already changed the payment capabilities and now we are working on the next layer platforms. Here is where we will see the massive change in borrowing and lending.
With a change in the monetary system comes a new relationship with money. The bank-driven centralized model is going the way of broadcast television. It is the era we live in. As much as the establishment pushes back against technological progress, the worse it gets for them. This becomes like a dam which, the longer it builds up, the worse it is when it breaks.
There is no doubt that decentralized money is the future. It is only a matter of time.
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