Income inequality is a severe problem across the globe. In the U.S, income inequality has reached its record high, prompting some people to look for ways to address the issue. Many people now wonder whether Bitcoin and blockchain technology could be a perfect fit in this equation.
Digital currencies can potentially bridge the wealth gap globally. Since 2017, developing parts of the world like Latin America, Sub-Saharan Africa, and Southeast Asia have enjoyed a growing blockchain technology exposure. Some charity organizations also use this cryptocurrency to help individuals build credit and access loans without opening bank accounts. What’s more, people in these places can receive Bitcoin and convert them into dollars that they can use to acquire the resources they need.
Over the recent past, more people are turning to online trading platforms, click here to trade this cryptocurrency for profits. Some individuals even use such systems to earn income. That’s because this system provides information about this cryptocurrency. It also enables individuals to trade Bitcoin in manual and automatic modes. Thus, even people with no or little experience can purchase and sell this virtual currency for profits.
However, learning about Bitcoin and how it can help address the income inequality problem is crucial. That’s because knowledge about this cryptocurrency can help you make the best investment or trading decisions.
Bitcoin Explained
Bitcoin is a virtual, electronic, or digital currency. It only exists on the internet. That means you can’t have Bitcoin minted coins or printed bills in your pocket. However, Bitcoin has value, like fiat money. And this mysterious nature of this cryptocurrency has led to misconceptions regarding its use. Some people have even relegated Bitcoin to the gamers’ and hackers’ realm.
But the cryptocurrency history paints a different picture. The main reason for creating Bitcoin was to bridge the wealth gap globally. When registering Bitcoin’s domain name, the creators of this cryptocurrency were going through the 2008’s Great Recession, like anybody else.
Soon after, Satoshi Nakamoto, the purported and mysterious Bitcoin creator, released a statement in which he explained this digital cash-to-cash system. According to Satoshi, this system should act to fight the manipulation of the centralized currency.
However, wealth inequality is a drastic issue since many middle-class, and lower-class individuals can still not afford Bitcoin. In the U.S, inequality has continued to grow over the last five decades, and the federal data shows that the middle class is shrinking.
The global economy has continued to face significant pressures. However, experts note that the growing Bitcoin popularity could help in the fight against income inequality.
Bitcoin Could Help in Strengthening the Middle Class
Bitcoin functions on a different, more transparent network. And this is what makes it unique and different from corporate banks. A public ledger or archive, the blockchain, records all Bitcoin transactions. Essentially, blockchain is a record for digital money. It’s a shared, independent, and encrypted money entries database.
Some experts believe that the world can leverage the blockchain network’s fundamental growth to deal with income inequality. The elites and governments want to be wealthier. Therefore, they create inflation, leading to the flow of wealth to the top. And this explains the continued growing wealth inequality. Bitcoin can solve this by enabling individuals to opt-out of the fiat system as asset owners.
Enhancing Financial Literacy
Encouraging asset ownership is a way of fighting income inequality in some countries. However, a different game plan is necessary for developing nations. Bitcoin can reach more users, even in places with no banking systems. That’s because all a person needs is a smartphone to transfer and receive this cryptocurrency.
Over 1.7 billion people globally do not have bank accounts. Such people can now use Bitcoin to receive, transfer, and store value. Thus, Bitcoin can help drive developing nations’ economies with inadequate banking systems by acting as a financial service.
In a nutshell, Bitcoin can help address the income inequality problem in many ways. However, people should learn about this cryptocurrency and its potential first.
