Cryptocurrency is offering opportunities to people who never had them before. Many, especially in developed countries take much of what we are seeing for granted.
However, what if you were never able to own stock? What if buying an asset that could appreciate is something you never experience? Imagine the biggest purchase of your life is a car, something that is going to depreciate in value over time in addition to requiring repairs.
This is the plight millions find themselves in. The idea of owning something that will be worth more in the future is a pipedream to people in this situation.
Fortunately, cryptocurrency is changing all that.
Yield Versus Speculation
This is something that many simply do not think about. When it comes to making investments, there are two primary categories. We have assets that one is basically speculating upon such as a non-dividend paying stock or ones that produce yield. Some are able to do both but for simplicity we will keep it to two.
Within Hive, we basically have both of these covered. There is yield through the Hive Backed Dollar (HBD) placed in savings. Then we have the value capture coin in $HIVE. While there are ways to generate a return, the big payout comes from massive price appreciation.
This is the quandary many find themselves in. Which one to focus upon.
Here is a thread that was posted.
This is an individual who most likely never encountered something like this. We are dealing with an asset that can go up many times in price versus one that will offers a stated yield.
Which to go after? This is a question that befuddled investors for centuries.
Wealth Building
It is very difficult to build any kind of wealth on one's efforts. The time-for-money system most operate under simply does not provide enough income for most to get ahead. Certainly, we can point out athletes, movies stars, or highly paid executives at major corporations as examples where this does not apply. However, for the masses, it simply is the case.
Even earning a fixed return of 20%, the mark Warren Buffett set down, it is unlikely to lead to much if there are few resources to begin with. If one begins with $100, it is going to take a very long time to have any type of wealth accumulated. Again, people point to Buffett overlooking the fact he started his accumulation of Berkshire Hathaway with $25 million.
A nice starting point that does not apply to most people.
Obviously, this is where speculation enters. It is important to get some assets that can realize outsized returns periodically. This is how a nest egg is built. Putting one's money to work, no matter how small it might be to start, is crucial.
Cryptocurrency is offering that option to people.
Inclusive
What does it say about a system when the majority of the population around the world is not able to participate?
We all know the traditional financial system is exclusionary. It is why politicians who fight cryptocurrency in favor of TradFi are so perplexing. Do people actually believe they are on their side? Sadly, many do based upon the way they vote.
Cryptocurrency is a system that is inclusive. When we look at an ecosystem like Hive, we see how people can arrive with no resources yet get rewarded. This often takes the form of an asset that can appreciate in value over time. Again, for many, this is the first foray into dealing with something like this.
Bitcoin got it all started. For many, if not most, this was the initial entry into cryptocurrency. The one drawback is that it requires money to acquire BTC. Once the design if mining changed, it basically became an asset to purchase.
Nevertheless, those who did, especially from the early days, saw a nice return.
That said, whatever the method, cryptocurrency has a few hundred million people involved. In fact, it likely has a larger population than any single country, with the exception of India and China. We have more people involved in this industry than there are living in the United States.
And we are only in the early days.
Decentralized Finance (DeFi)
Filling one's bags is important for reasons other than the obvious.
Many are looking at this in terms of speculation. However, there is another side to the equation that is still under development.
To rival the TradFi, we need to build out DeFi to the point where it provides many of the same options. This is going to take a while but the value of the assets is very important.
One of the crucial components of finance is collateral. This is a factor in risk management. Collateral is often required to reduce the risk to the lender when making a loan. Regardless of the form this takes, it is a central premise in any financial system.
Digital assets are going to fill this role. As the industry gets the infrastructure in place, these features can be built into applications. This is where things really start to get interesting.
The ability to mirror a lot of what Wall Street did but in a decentralized manner is enormous. This opens us a system to billions of people who are presently excluded.
It is easy to see why people like Gary Gensler want this stopped. His goal, it seems, is to get this in the hands of Wall Street financial institutions and let them take over. The banks are great at making sure a system is exclusionary.
In the end, the masses do not have access to assets that could change their lives. Cryptocurrency offers this opportunity.
For many, it is the first time they ever got exposed to something like this.
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