- >Bitcoin Fixes The Things You Hate About Capitalism
Bitcoin Fixes The Things You Hate About Capitalism
Times are tough. It’s tough for millions of people across the world whose situations never change. Not that they don’t work hard, but because the system is rigged against them. In fact, the harder they work, the more the people at the top get richer, while their (workers) wages remain the same. Meanwhile, the richest 1% own nearly half of the world’s wealth in a staggering display of gross inequality. The young generation is especially taking the biggest hit in this skewed distribution of wealth. The Corona pandemic hasn’t helped either. The net effect of this is increasing disillusionment with capitalism.
Enter Bitcoin. Bitcoin challenges long-held assumptions on money, the economy, and to whom control should belong. And in many ways, it helps fix some of the woes wrought by capitalism.
Hope Mutie | Mar 25, 2021
Capitalism is an economic system where the means and resources of production are privately owned, and this production is nearly always geared for profits. Capitalism traces its roots to feudalism. Feudalism is an economic system in medieval times where a tiny percentage of Europe’s population lived in towns. Workers would provide labor in return for a keep (room & board), rather than money. However, by the Middle Age, towns were becoming more urbanized, and more people were flocking to urban areas. As these places became important trade and exchange centers, labor was rewarded with money instead of subsistence.
Most countries today practice capitalism, including the vast majority of Western nations.
Capitalism is characterized by several features, which include but are not limited to the following:
- Profits and accumulation – With capitalism, growth is fueled by more growth for the sake of growth
- A two-class system and wage labor – A capitalist economy has two social and economic classes: the capitalist class, which owns and controls the means of production, and the working class, who offer their labor in exchange for wages
- Freedom for capitalists – Capitalists get to act in their self-interest in how they run their operations- with little of government check to get in their way (which could explain why Amazon gets away with so much)
Why Capitalism Earns a Bad Rep
As the world grapples with challenges like corruption, climate crises, and staggering inequalities, many people are increasingly becoming disillusioned with capitalism. The faults with capitalism have only been laid barer in the wake of the Corona pandemic, with economic and social shocks reverberating across populations. The following are some of capitalism’s biggest crimes.
- Cronyism – This is not a weakness of capitalism per se but an almost inevitable offshoot of the system. Crony capitalism is when business owners are in bed with the ruling class. As a result, the capitalist class gets government assistance through tax breaks, back-of-the-door tenders, and such manner of incentives. In this environment, fair competition is suppressed, and there are barriers to entry. The relationship between the business class and the state is mutually beneficial. The business class is protected by the state, while wealthy business execs donate to officials to access and stay in power.
- Monopoly – Capitalist systems exist with little to no government control. This creates a free market, where unfair competition or monopoly may exist.
- Corruption/Lack of Transparency – In the freewheeling capitalism environment is an enmeshed culture of corruption. Due to the unchecked nature of various industries, evils like kickbacks, nepotism, awarding non-competitive contracts, and abuse of power reign supreme. Over time, these ills spill over to the social makeup itself.
- Inequalities – Reinforced partly by corruption, inequalities arise when the rich get richer through dishonest practices. Other disparities are spawned through the rich passing down their wealth to figure generations through inheritance, while the workers who held together such dynasties remain poor.
How Bitcoin Fixes Capitalism’s Ills
Bitcoin and Bitcoin’s ideals attempt to fix capitalism’s ills. It can do this because Bitcoin’s guiding principle is decentralization. Decentralization means no one is calling the shots whatever their standing in society. Bitcoin is an equalizer. It’s also radically transparent in that every single transaction in its history can be viewed on its public network.
Let’s look more specifically at the ways Bitcoin solves some of capitalism’s problems.
#1. Opportunity for all – Inequalities constitute social and economic disparities. How does Bitcoin address inequality? One can grow wealth through Bitcoin and the products it has spawned. The newly emerging DeFi (decentralized finance) ecosystem rides on the back of Bitcoin’s success and ideals. DeFi is powered by smart contracts meaning you don’t need to hire an expensive lawyer or pass through tedious bank vetting processes to access products. All you need is a mobile phone with internet connectivity to access these and more products to start earning:
- Yield farming
- Betting on prediction markets
- Participating in no-loss lotteries
- Monetizing your content on platforms like Steemit
Thanks to Bitcoin, wealth growing tools are no longer concentrated only in the hands of the bourgeoisie and wealth inheritors. Everyone can get in and start the journey to a decent life.
#2. Decentralization – Bitcoin employs a distributed system of governance. No matter how high-placed one’s connections, it’s impossible to buy your way into special status in the Bitcoin ecosystem. All decisions are arrived at through community consensus. In the end, you have a fair system where everyone’s voice, no matter their social status, origin, or gender, is heard.
#3. Transparency – There’s no corruption in Bitcoin. The generation of new Bitcoin is controlled by its code, and no one is unfairly getting proceeds through shadowy means. The amount of BTC in circulation and the amount not yet generated is there for all to see. It’s impossible to create fake money and game the system to one’s unfair advantage. Similarly, no one can manipulate its price and supply. Everything comes down to the pure forces of demand and supply.
Capitalism is one of the better economic ideologies. But many a dream has died upon its altar. It appears that throughout history, we have yet to identify an economic framework without its own collection of faults. Bitcoin stands as a means to unbiasedly serve as the underpinning to not just capitalism, but all future economic frameworks. Thanks to Bitcoin, we now have the ability to make several of the factors that tarnish capitalism obsolete. Bitcoin fixes things people hate about capitalism.