On July 4th, 1776, the Continental Congress set the United States on the path to freedom when it signed a document drafted by Thomas Jefferson that became known as the Declaration of Independence.
What Is Financial Freedom?
Financial freedom means different things to different people, but it ultimately boils down to being in control of your finances and life choices.
On this Fourth of July, we might ask ourselves a question: could cryptocurrency be the modern-day Declaration of Independence that empowers people worldwide to shake off the shackles of the traditional financial system?
Financial freedom is predicated on several factors, including property rights, judicial effectiveness, government integrity, an individual’s tax burden, ease of business, and market openness.
However, the current financial paradigm was set up to put power in the hands of centralized authorities, enabling them to control and emasculate the masses while benefiting only a few. But outliers such as the pseudonymous Satoshi Nakamoto, the inventor of Bitcoin, sought to turn this system on its head and return power, choice, and control to ordinary people.
Cryptocurrency and Financial Freedom
Financial freedom can only be achieved when all parties have access to the same level of control and information. This can only be made possible through decentralization, a core concept of cryptocurrency. By allowing people to access wealth without an interloper and with the assurance of security, cryptocurrency can be a powerful tool in empowering ordinary people to take wealth-building into their own hands.
Cryptocurrency has the potential to make financial freedom a reality because of several fundamental principles that underlie it.
For a start, cryptocurrency uses an open network that is globally available, meaning that people worldwide can transact with each other on shared networks free from government control. This fundamental principle can lead to more open markets, significant trade and investment opportunities, and financial independence.
Cryptocurrency also enforces property rights, which means that people can save their money, accumulate wealth, and plan for the future, knowing that the work of their hands will not be unfairly seized by rogue government agencies or meddling third-party financial institutions.
In some jurisdictions, contractual agreements, which form the basis of property rights, have little if any value because there are no guarantees they will be enforced. But the smart contracts that power digital assets have now moved enforcement from judicial courts to indelible blockchains that cannot be compromised.
Every person with access to the internet can buy, sell, get paid, and accumulate wealth in cryptocurrency. In parts of the world where access to financial services is limited, crypto makes transactions possible with just a mobile phone.
Additionally, cryptocurrency is anonymous, open, and unbiased. It has no regard for race, gender, or social background.
Digital assets also make mobility possible by significantly reducing the barriers to the movement of funds, such as switching costs. This allows people to accumulate wealth and move it across borders at minimal cost and with minimal fuss. Low to zero commissions on crypto trading also allow people to keep more of their wealth and set them on the path to financial freedom.
Financial freedom is based on accessibility, stability, and value. Crypto allows people to control their assets and keep them out of the hands of over-reaching governments or third-party intermediaries looking to take a cut of every dollar they make.
Cryptocurrency provides a fresh perspective on freedom in many regions of the world where traditional banking is challenging or nonexistent by safeguarding finances, maintaining privacy, and enhancing access to financial resources. As a result, more individuals will live in a world with greater social fairness and financial independence.