How Cryptocurrencies Like Bitcoin Can Democratize Money and Society
As cryptocurrencies like Bitcoin break new records seemingly every day, could this lead to a financial and cultural revolution? Or are we not quite there yet?
Cryptocurrencies have recently gained popularity as an alternative to conventional monetary systems. Blockchain is a system in which a record of transactions made in Bitcoin and other cryptocurrencies are maintained across multiple computers that are linked in a peer-to-peer network. Cryptocurrency has no centralized bank controlling the flow of money, but rather a decentralized system controlled by algorithms.
Crypto has been hailed as a way to democratize finances for all, not just wealthy elites. But with the rise in popularity, what are the potential pitfalls of these online currencies?
“Blockchain is a way of digitally marking the development and moving around of this money—you’re making sure that it can’t be counterfeited. They do it in such a way that it’s anonymous and decentralized, but secure,” Zeus Yiamouyiannis, author of Transforming Economy, said.
“The current monetary system can be manipulated; the supply can be manipulated to benefit very few people over the many. As we’ve been seeing over the past few decades, the same pattern keeps emerging and it’s growing, and that is greater and greater gambling by the big boys, to the point where they inherently fail through their greed. And guess who bails them out 100 percent of the time? The little guy who had absolutely nothing to do with it,” Yiamouyiannis said.
Can Meme Stocks Shift the Economy in Favor of the Little Guy?
The financial system has been turned on its head in the past few months with the rise of what has been named “meme stocks.” But is this grassroots movement of regular everyday investors a passing trend? Or could they really transform the way our economy works going forward?
“Meme stocks,” called such because they are ordinary stocks fueled by people through social media, can spike in value based on the zeitgeist and not the fundamentals of the companies they represent, and as a result can often be highly volatile. Made famous by the popular subreddit r/wallstreetbets, this is truly a grassroots movement.
But even with the volatility that comes with these stocks, investors are not shying away from them. Many investors are doubling down, despite warnings from financial institutions, or perhaps in spite of them. But what is driving the popularity of meme stocks, and why do they continue to grow contrary to what markets dictate?
Zeus Yiamouyiannis, author of “Transforming Economy: From Corrupted Capitalism to Connected Communities,” explains:
“Well the first thing I think is the larger social phenomenon of the little guy getting screwed, and the big guy rigging the game. And it has never been any more rigged and the concentration of wealth has never been more dramatic, and so what happens is it creates this groundswell of desire to strike back at an unfair system, to strike back at these profiteers, and to win one for the little guys.”