The "Exit" Option

Prior to the creation and deployment of bitcoin and dApps, citizens were limited to the financial services available within their country or region. This was fine if you lived in countries with a well developed banking system such as the United states or Europe as long as you were a citizen of the country. If you were not a citizen but living within the United states, opening a bank account post 9/11 had become quite restricted, making transacting and living difficult for some inhabitants. As many other social services require citizens to have a bank account. Citizens of countries with flawed banking systems such as Nigeria or Greece are significantly limited in the trust as well as efficacy of the banking services available. “You will own nothing and be happy”, a term thrown out by the World Economic Forum (WEF) indicating the official bureaucratic plan to limit sovereignty and ownership in favour of subscription based services, the sharing economy as well as AI convenience. While there is some truth within the statement in regards to the future of the world, it was interpreted as a dystopian threat for many, prompting the need for sovereignty in our digital future

The availability of banking services within the developing world, pre blockchain era was primitive and subject to corruption as well as significant fees. Services such as with western union dominated the international transfers market but were subject to long wait times and significant fees. This reduced the efficiency of doing business within these regions, as business owners were subject to these inefficiencies. This lead to limited profit thus limiting the potential services available for customers and reducing the number of businesses within the region able to benefit the surrounding communities. Within some regions banking was not even available at all, requiring inhabitants to stores their wealth in the form of cash or precious metals within their homes or businesses. Prior to bitcoin and DEFI, the people had no choice but to utilise the flawed banking system they were limited to within their regions, significantly impeding economic growth.

Countries such as Argentina have a significantly more developed banking system when compared to some countries within Africa, but suffer from an insecure currency, where the currency has been mismanaged leading to hyperinflation, resulting in a falling currency value. As the value of a currency falls, the trust in it reduces leading to mass selloffs of it, resulting in a self enforcing negative feedback loop. Currencies such as the US dollar have stable value across time, and so is held as the world reserve currency by many central banks globally, as well as businesses and people are happy to accept it. This is what keeps a currency stable, the belief it is stable and so people are willing to accept it and hold it over a period of time. Within Argentina, the premium to buy bitcoin has been as high as 20%, as bitcoin despite its volatility has a proven track record of creating higher highs over and over again despite the short term plunges. Bitcoin within these countries is essential to restore sovereignty as well as value to the currency supply.

Within El Salvador, their official native currency has been shut down due to mismanagement, and have officially adopted the US dollar since January 2001, bringing stability to the region. The issue with the adoption of a foreign currency, is that the nation is now limited in the monetary policies it can enact. Financing for government expenditure becomes much more complex as well as the the US currency supply is inflating (as all fiat currencies) but not towards the benefit of the nation, but at the cost of the citizens. In addition the country has poor banking services with a large proportion of the citizens being unbanked. Bitcoin, within the Chivo wallet has largely been adopted within the population which allows for instant transactions utilising the lightning network which not only allows the instantaneous transfer of bitcoin between citizens but can utilise the network to transfer US dollars as well. This has lead to mass adoption of the technology, leading to significant improvements in welfare for the citizens

Bitcoin as well as DEFI have given people all around the world the option to opt out of their country’s limited financial system and tap into a global financial system with world class services available to anyone who has a cheap smartphone and an internet connection. This allows developing countries to rapidly increase the quality of life for their citizens and create a higher standard of living