3 June 2022
Crypto breaks borders, and that is why experts talk about its influence on the concept of economic freedom. It is the fundamental right of every human to control their labour and assets. Different levels of economic freedom distinguish various jurisdictions, and there is an opportunity for everyone to access digital coins. The mass adoption of cryptocurrencies can solve this issue, but how does crypto enable economic freedom?
Crypto And Economic Freedom
In 2007, Satoshi Nakamoto presented a new monetary solution that could be an alternative to the classical economy after the financial crisis of 2007–2008. With Bitcoin, people get a tool to control their funds and transact them to any place in the world. And most importantly, every crypto holder can avoid the loss of time and costs that characterise fiat (traditional) transactions.
Plus, the decentralised nature of digital currencies eliminates the need for authoritarian control. Instead, users share responsibilities, which is vital for understanding cryptocurrency. Crypto holders are in charge of their wallets, while particular users called validators verify and perform transactions. The emergence of Bitcoin started a big chain reaction to create other digital assets. As of this writing, their number exceeds 10,300.
While some coins share the BTC concept, many others provide some unique features to the field. For instance, Ethereum (the second-highest crypto asset) offers a unique 256-bit platform — Ethereum Virtual Machine (EVM) — to create decentralised apps and the ERC-20 standard of Ethereum-based token creation. Another example is Filecoin (FIL), the cryptocurrency that underpins a self-titled decentralised file storage network. But they have one thing in common: they utilise blockchain technology.
Digital assets started a crypto revolution that aims to consign the bureaucratic financial system to the dustbin of history and erase the boundaries between nations.
Five Ways How Cryptocurrencies Drive the Economic Freedom
Anyone can create a wallet, buy crypto with a credit card and start managing them. You do not need to fill out an entire lot of paperwork – only a smartphone/tablet/PC and a stable Internet connection.
An Open Network
Jurisdiction prevails only for centralised currencies, while digital currencies span beyond geographical boundaries. Crypto coins and tokens are entirely transparent and accessible to everyone with an Internet connection. Lack of control by centralised institutions, transaction authentication, and low fees are the main reason to invest and trade cryptocurrencies.
Protection From Theft
Decentralised assets operate outside the location of third-party organisations, and you can use them freely without the risk of confiscation. Moreover, many crypto coins and tokens guarantee that users cannot track transactions and stole digital currencies. In some cases, it is done via blockchain, while in others — using specialised wallets (as with Monero). Therefore, people from countries with unstable economies or authoritarian regimes can get more financial freedom and not lose money due to inflation.
A Currency of Integrity
Cryptocurrencies cannot affect all components of economic freedom, but they can encourage individuals to improve personal security. Since people can hold digital coins more securely than fiat currencies, they have tremendous potential for strengthening economic freedom and promoting safe asset management.
A Non-Discriminating Asset
The anonymity of transactions is one of the vital benefits of crypto finances. You cannot find any personal data because the blockchain network does not consider it when allowing access to digital assets. Thus, anybody with a stable Internet connection can send, receive and exchange crypto. Besides, it is controlled by the user community and can be accessed through different providers.
Full Mobility
Despite failing to improve economic freedom completely, digital currencies have unique features that make them mobile. For example, transaction fees are lower than fiat money switching, allowing to operate crypto worldwide and accumulate wealth. It increases both economic freedom and power over the owner’s crypto capital.
People often unite into mining pools to generate new cryptocurrency more quickly and get a reward for it. Learn more about building a rich mining pool here.
7 Cryptocurrencies That Provide People With Economic Freedom
Digital currencies do not have enough leverage to improve the taxation system and public spending. However, they can enhance some core components (e.g., trade and investment). Bitcoin and other crypto-assets allow the building of a flexible financial system. Let’s explore the top 7 virtual currencies that can help with this.
Bitcoin
It is considered the most valuable cryptocurrency. Since its emergence in 2009, BTC has become a flagship asset. According to the TradingView live chart, Bitcoin’s share is 46,7%. So it is not surprising that 9 out of 10 first-time investors prefer to buy the #1 cryptocurrency. Moreover, such a strong trust in this asset provides financial freedom to the BTC holders.
Ethereum
This digital currency ranks second in the list of most popular crypto assets. As for now, the Ethereum 2.0 version works; it provides a more comprehensive financial infrastructure for creating smart contracts and potential adoption of ETH in many industries (e.g., logistics, audit, and management.
A smart contract is a special algorithm for exchanging cryptocurrencies and other assets.
Solana
Solana (SOL) is a crypto project that offers to create decentralised applications. Its primary benefit is a high speed of synchronisation between nodes (particular computers in the blockchain network), so developers can easily scale up their decentralised finance (Defi) solutions. Moreover, a unique Turbine protocol covers breaking the whole amount of information into smaller “pieces.”. All of this allows users to get more financial freedom via a comprehensive crypto economy.
Cardano
Cardano (ADA) is an open-source blockchain platform that is designed to support financial programs used by businesses, clients and governments worldwide. This solution successfully combines advanced technologies to make decentralised applications more secure and sustainable. Plus, crypto investors can send and receive ADA to any place, providing fast and direct transfers.
Tether
Tether (UDST) is a token that has been designed to solve the volatility problem. This asset is tied to the US dollar and is backed by bank reserves and loans in USD with the total value of USDT market capitalisation or even more. Such an approach provides investors with the stability of the asset and a well-thought-out exit strategy.
Volatility is a measure of price movements over a specific period.
XRP
XRP is a cryptocurrency developed by Ripple Labs for settlements between banks, financial institutions and even central banks. Besides, crypto investors can use this digital asset for payments and international transfers. And all thanks to the main benefit of XRP – —high transaction speed and low transfer cost. Therefore, it is one of the best cryptocurrencies getting more financial freedom.
Polkadot
Polkadot (DOT) is an open-source protocol that leverages cross-chain bridges, parathreads and parachains to transfer assets and data. Further, it provides interoperability between different blockchains, giving more financial freedom to crypto holders.
Bridges are digital tools used to connect and combine blockchains. Parathreads are blockchains leased to users, while parachains are autonomous blockchains that operate based on the system core.
Conclusion
Digital assets can enhance various components of what we call economic freedom. It can help to improve living conditions and build an effective blockchain economy in jurisdictions with unstable financial situations. Therefore, crypto coins and tokens are a key to building a transparent global monetary system where people can control their own money and labour. At Rocketech, we know how to create first-class software for different industries. Our dedicated teams implement advanced approaches to develop products that meet even the most specific needs and requirements. And if you want to get a top-notch solution for your business, contact us.