Change is in the air.
This is something that anyone who is involved with cryptocurrency understands. While the bear put a damper on things, the overall progress of the industry is still taking place. It is best to focus upon growth and development as opposed to prices. The latter can be extremely misleading.
That said, most people are unaware of what is going on. Here is where we need to understand this is completely normal. Transition often occurs "under the radar". The average person is going to be late to the game, which is actually right on time.
Cryptocurrency is no different. What is being developed will end up replacing what we have. However, it is going to take more than a decade, from now, before it is fully realized.
Actually, when we think about it, this is an accelerated pace.
The Evolution Of The Monetary System
A new iteration of the monetary system does not come around very often. This means that while money is continually changing, the system itself is rather stagnant.
If we are using broad scale evolutionary phases, we are about to embark upon the 4th era of our monetary system.
The previous three were:
- single entry accounting
- double entry accounting
- global private banking
Now we have what many are calling triple entry accounting.
It is important to note that each of the last two iterations resulted in some very powerful entities.
The creation of double entry accounting saw the formation of credit, which resulted in the banking families of Europe. This gave us the likes of Metzler and Rothschild. These families had a hand in much of the global economy for generations.
After that we saw the likes of JP Morgan, an individual whose company turned into a powerful corporation along with Citicorp and Goldman Sachs.
It was the third generation that took things to an insane level. When the system went global with the banks creating different forms of money, they were able to drive economic output to even greater levels. Here is where national banks with some international exposure became household names.
The move into another phase of monetary evolution presented opportunity. Here is where the banking system left the regulatory and central bank monetary system in the dust.
Now we are embarking upon another leap forward. Do not underestimate the power of blockchain and cryptocurrency. This is taking a 70 year old system, mostly analog in origin, and giving it a 2020s spin. It is also providing inclusion and transparency, two things absent from the present monetary system.
Enormous Change Without Anyone Noticing
Even today, few are aware of the monetary system the world operates under. We know this by looking at how many people follow the Fed or ECB. People are hanging on every word that Jerome Powell utters. Yet, how many actually discuss the number of Repo fails that took place over the last 60 days?
This is where the advantage lies with cryptocurrency. When transitioning from the old to new, it often occurs without most being aware. For example, it wasn't until the 1970s, more than 20 years later, that the established system even began to sense something was different taking place with money.
It was actually in the early 2000s that Alan Greenspan, then Chair of the Fed, uttered these insightful words:
As a consequence, while of necessity it must be the case at the end of the day that inflation has to be a monetary phenomenon, a decision to base policy on measures of money presupposes that we can locate money. And that has become an increasingly dubious proposition.
The evolution of the monetary system created such a change in money that, 50 years after it started, the most powerful central bank in the world was having a difficult time even finding it.
You have to wonder if, 22 years after that, Powell and his cohorts are even looking. It is more likely they just gave up trying.
How do you think things will be in another 20 or 30 years?
Cryptocurrency Taking Over
As shown, none of this is an overnight process. While cryptocurrency has a bit more "exposure" than the prior system during its development, that does not make it any less powerful.
In fact, since we are dealing with more advanced technology, it is logical to conclude this will be accelerated, more widespread, and create economic output far surpassing the previous generation.
Blockchain is really just the digital version of what is already in place. When we concentrate upon the global monetary system, it is really nothing more than accounting (ledger) coupled with communications (computer networks). For much of the last 70 years, this was analog in form.
Now we are bringing a digitized version to the table.
Therefore, do not believe that we are dealing with something new. It is an evolution, not a clean sheet design. This is why we can feel confident in the long-term prospects. We have 70 years worth of evidence of how this works.
The transition is on a per unit basis. This is something that people need to understand. Each time someone transacts in cryptocurrency, that is advancing the new system. By the same measure, every single unit of fiat that is moved into cryptocurrency adds to the new while removing from the old.
What we are dealing with is hundreds of trillions of dollars. This is the case whether we look at the transactions, investments, or monetary value held. As of now, 99.99999% (or more) is still in the old system.
That said, cryptocurrency keeps growing. As more users join, that means we have more transacting. That is one of the first areas to shift.
As we advance, we will see people using cryptocurrency without realizing they are doing it. At some point, people will simply be gaming, earning in-game rewards along with assets, and think nothing of it.
However, those of involved understand that is all part of the new monetary system that is emerging. Again, the evolution is nothing new. The difference is we are now able to participate and watch it happening (if paying attention).
When people say that the "cryptocurrency revolution" cannot be stopped they are correct. However, what we are dealing with is more evolutionary than revolutionary. Either way, the next couple decades will see more done using this new system and less with the old.
It is similar to the Internet. Online shopping did not take place overnight but, over the past few decades, the volume steadily increased.
Cryptocurrency will follow the same path. Each new transaction will remove from the old.
And over time, the balance will keep shifting.
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I believe the crypto evolution will be faster than the old monetary systems' evolution. A digitized money becomes more fluid and flexible than fiat money. The scope of usage and having access is wider too.
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The commercial and monetary system like most other things have tasted the automation ;its no surprise and surely the advent of crypto in the face of tokenised value system have got into new track for this.
Let is be more hopefull for the future and who knows what would come next after web3.0 version goes backdated?
Only we could predict the future and its on the way of making.
👍
I think evolution is a really great way to look at it. Like you said, databases and ledgers have been around for years. This is just more accessible and transparent. I hope that real change comes a bit before the 20 to 30 year mark!
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you are right friend Cryptocurrencies are the evolution of our money besides who will provide us with the tools for the future
Hai pienamente ragione!
❤❤❤❤❤
Un abbraccio
@luba555
When that 0.01% "transactions, investments, or monetary value" grew to just 10%, no one could take cryptocurrency for granted anymore.
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