Many are excited about the prospects that Bitcoin and other cryptocurrencies offer. This is going to radically alter our financial and economic system. It is something that is almost guaranteed, considering the point we are at.
We have decades worth of evidence as to why this is the case. In other industries, we saw massive improvements when the same process that cryptocurrency is on took place.
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There was a time when we lived in an analog world. For example, telephone operates use to be relied upon to connect the caller. There were no automatic switches. It was done by a human.
At the same time, people were once required to operate elevators. This was mainly from the days when those devices were mechanical. Once again, progress meant that nobody is operating an elevator anymore (except for nostalgia sake).
The shift to digital is a powerful one. Oftentimes, the progression was to operate in an electronic manner before becoming fully digitized. What this means is that a lot of the process was automated, yet there was still human intervention. The specific task might be taken care of but there were a variety of other ones that required people.
Full digitization eliminates all of this. Telephone calls are completed without the input of human beings. Even the oversight of much of the system is done by computers. They have real time diagnostics taking place that not only alert but also correct problems as they come up.
The financial world is still full of people. It is an industry that automated to a degree. We still see, however, many layers where individuals are involved.
Over the past two decades, a lot was done in this area. FinTech became the norm and offered up applications that handled a lot of the front end activities. Throughout the system, there were steps taken to move towards automation, such as stock purchases on the exchanges being done by computers as opposed to human traders.
So we did see a great deal of progress. Nevertheless, full digitization is still down the road.
If we look at the mortgage process, very little of that is automated. Certainly the application can now be done online. Yet, it still required a great deal of human involvement, which is a time consuming effort. This is why it takes a number of days to get the process completed.
Imagine being able to apply for a mortgage, have the approval, receive the document to "sign", and have the money transferred within a few moments. Does that sound like a more efficient system?
That is what fully digitized looks like. It is instant, without any delay because information and resources are readily available.
There is no more pre-approval which is based upon a quick scan only to be either validated or negated after further research. All decisions will be instant. The system will have access to all it needs, immediately being able to access the situation.
Now, spread this concept across the entire economy. Remove all financial delays at every step of the process. At the same time, see a reduction in costs as rent seekers are minimized. How much more efficient a system will that be?
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Digital assets are far superior to what we have now. They are easier to store, move, and utilize. Most of our financial network is constructed based upon physical items. This is where people place value. However, if we look to areas of society that already transformed, we can see how this is misplaced.
Take music for instance. Does anyone value a CD anymore? Is that where the worth of the music is? Few would consider the physical item any more valuable than the digital one. Sure, there are collectors who crave the record cover of a famous album. Yet, outside of that, we understand that the digital version is just as valuable as the physical one.
Money is starting to make that transition. Having digital money is a leap forward compared to what we are operating with now. Plus, we can also see how having value in digitized form is more useful than in physical.
Email became popular rather quickly. In fact, who writes physical letters anymore? The overwhelming percentage of messages, 99%+, are sent in digital form. Today, there are a host of other ways to communicate outside of email. Would anyone make the case that physical correspondence is better?
We see the same thing with information in general. Compare cloud or server storage to the old filing cabinet. How difficult was it to find the right information and get it to the proper party? Someone had to locate the information and pull the file. Then it had to be delivered to the other person. If he or she was not physically there, it was either copied and mailed or sent via facsimile.
Today, one just logs in and the information is there.
An economic system that is constructed upon digital assets is guaranteed to be superior to one that is not. We know the power of digitization. This leads to the demonetization and democratization in many ways. When this takes place, we have a more inclusive system that free up resources for other areas. Ultimately, it streamlines the economy as operates throughout become more efficient.
This is one of the reasons by Bitcoin is holding so much promise. Since it is evident that it attained the role of "store of value", we are going to see a great deal built upon it. While I do not believe it will be the only game in town, it does serve as the first mental deviation from our present reference point concerning finance. As we delve deeper into the virtual realm, we will likely see things changing a great deal as our minds expand into the near infinite possibilities.
How it all unfolds and what it will eventually look like is a great mystery at this point. What we do know is that, based upon the transition from analog to digital, we will see a far superior economic system as compared to what we have now.
Cryptocurrency is at the core of this transition. Other asset digitization will also follow helping to create a more robust economic system. If what we saw in other areas happens in finance, we see a larger distribution that reaches more people since the pie becomes a lot bigger. As we move toward near-infinite, which the digital world provides, people are able to participate to a much greater degree.
This will only cause more people to get involved. As the present system encounters the same old obstacles, a newly designed digital system will offer something that few were exposed to before.
It is all on the pathway to abundance.
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