What The World Will Look Like On A Bitcoin Standard
As more individuals, businesses, and even nations explore the possibility of adopting Bitcoin as a monetary standard, it’s fascinating to imagine how the world might transform. While critics point to volatility and scalability concerns, those favoring this decentralized digital currency envision a future unlocking new economic freedoms and efficiencies.
Magical Micropayments
One of the most compelling prospects is the ease of micropayments. Today, traditional payment rails are ill-equipped to handle transfers of tiny fractions of a cent — the fees would often exceed the payment amount itself. However, on a Bitcoin standard, sending even the smallest amounts globally would be essentially free after the initial minimal transaction fee. This opens up mind-boggling possibilities across countless industries. Websites and digital content creators could seamlessly accept payments per-page or per-minute rather than relying on ads or subscriptions. Micropayments could re-shape how we consume media and information. Internet of Things (IoT) devices could autonomously pay for resources as needed rather than pre-paid plans. The implications of enabled micropayments at scale are boundless and disruptive.
Peer-to-Peer Empowerment
Another dimension is the peer-to-peer decentralized nature of Bitcoin. Instead of relying on intermediaries like banks to verify and facilitate transactions, anyone on the Bitcoin network contributes to this process. This democratization of finance could spur grassroots innovations and empowerment across remittances, micro-lending, and new peer-to-peer economic coordination models. Some envision flourishing micro-economies and communities built on Bitcoin, where contributors are paid instantly and equitably without centralized control. Transparent and auditable on the distributed blockchain, these decentralized networks could become self-sustaining engines driving participation and exchange of value.
Obstacles Remain
Of course, there are still hurdles to clear for this vision to materialize globally. Bitcoin’s current throughput is limited compared to major payment processors, though layers built atop it like the Lightning Network could enhance scale and speed. Regulatory uncertainty persists around Bitcoin as legal tender. And convincing the world to divorce from fiat currencies and familiar payment systems will be a Herculean feat. So far out of 195 countries only one has made it clear they believe Bitcoin is legal tendar. Still, the brightest minds are working feverishly to make Bitcoin a more viable and usable foundation for the future of money. With each passing year, the sociotechnical innovations it sparks become more palpable and compelling. A world built on the Bitcoin standard may very well make today’s clunky payment systems and centralized institutions relics of the past.
3/25/24
Conor Jay Chepenik
