Is Cryptocurrency the Solution to Financial Inequality?
Experts predict that cryptocurrency will soon overtake FIAT money as the preferred medium of exchange, possibly as early as 2030. What does this mean for people currently experiencing financial difficulties? Do cryptocurrencies have the potential to solve these types of problems?
First, it is important to explore some of the causes behind our nation’s current income inequality crisis to understand how cryptocurrencies like Bitcoin might impact people in poverty.
Income Inequality in America
Income inequality in America means that 33.98 million people, or just a little over 10% of the entire population, live below the poverty line. And with the ongoing COVID-19 global pandemic, that number will likely grow until we’re completely out of the woods.
The reasons for the inequalities can be linked to a plethora of factors, but the most common are:
Education: Education is not equally accessible in all parts of the country. While it may be easy to get an education in one area or country, it may be much more difficult in another. In addition, factors like race and class can also impact access to education.
Wealth Condensation: The majority of wealth is kept and spent amongst already wealthy people, and that essentially means only the rich get richer.
Technological Development: Advancements in technology can render certain jobs obsolete; for example, an order picker in a warehouse.
Gender: The gender wage gap is one of the most famous examples of economic inequality, especially among single women trying to make a living independently.
Of course, there are more factors behind financial inequality, but compiling a list of them and talking about how they contribute would most likely take all day. Suffice it to say; these four are the top contributors.
How Cryptocurrency Can Help
Cryptocurrencies are the solution to financial inequality because they strengthen the middle class in two ways: (i) They stabilize the middle class, and (ii) They help people below the middle class to get into it by hold onto their hard-earned wealth.
Cryptocurrencies are much better than banks in holding wealth. While you may be rejected for a checking or savings account, cryptocurrencies are actually very inclusive. All you need is a phone and an internet connection. Alternatively, you can buy some at a Bitcoin ATM, which you find in some convenience stores or grocery stores.
Ultimately, what cryptocurrency does is give people hope: a hope that they don’t have to live in poverty all their lives just because they were born into the wrong socio-economic class. Cryptocurrency births the possibility that people can still integrate themselves into the world economy.
