Money and technology

in #english7 years ago (edited)

We are in a time when technological changes are changing the relationships between the economic agents of the system. The developed economies are at a stage where they are based on the higher productivity services sector, and knowledge and information are becoming assets which have an associated value that in time increases their importance in society.

This progress also reaches the monetary area, generating changes, among other things, in the conception and role of money within the economy. The beginning of the cryptomoneda era has made the role of fiat money and central banks within the monetary system debated. Some of the popularity gained by cryptocurrencies is based on the potential and effective access to more people (banking and not) at marginal costs significantly lower than other options. However, also cryptocurrencies are attractive to many people because their issuance is independent of a governmental authority, which in one way or another, manipulates the value of the currency over time.

This is true, especially in economies whose central banks deliberately execute inflationary monetary policies where the loss of currency value occurs at very high rates, as is the case of Venezuela, an oil country where the Central Bank of Venezuela, violating the Constitution of the country and submissive to the mandates of the government, is on an insane monetary trajectory that quickly directs the economy of Venezuela towards a hyperinflationary process.

Although the above is true, the levels of volatility shown by cryptocurrencies also highlight the fact that over time they will gain more from their condition of being denominated as money, and perhaps even with a higher confidence level of agents compared to traditional currencies issued by central banks.

Technological progress has significantly and positively changed economic and social relations today, as technology has undoubtedly helped to eliminate poverty and raise standards of living across all economies. That same breakthrough opens the door for changes in the way the economy and particularly money are conceived, where cryptocurrencies and also the technology associated with them will play a very important role in the benefit of society.