Ever since Bitcoin first emerged into the global scene, it has been a hot topic of contestation. Here was an alternative financial model, which sought to disrupt centuries old models of currency and economics.
However, the interesting thing to note about Bitcoin was in the impact it has had on the social, political and economic realms. The decentralized nature of the cryptocurrency has made it gain loyal followers and severe critics. The Blockchain technology has also been admired as a fast, secure and exciting way to move currencies across countries and continents.
In this article, we will look at how Bitcoin has affected the world’s social, political and economic landscape.
Social Impact of Bitcoin
I am sure all of you have heard of Western Union and PayPal. These are platform, which help people send and receive money all over the world. However, between their own fees, wire transfer fee, conversion fee and other hidden fee, you are looking at close to 16% of your entire transferred amount.
If you are using Bitcoin, this 16% vanishes. The receiver in full receives the amount you send or transfer. No part of it gets deducted. This means that if we are going to implement this when it comes to the global economy or even charitable avenues, the people who are most affected are the ones who are going to gain the most.
Bitcoin’s social impact also involves a psychological effect on how people handle their money. The control over your own money is liberating in nature. In today’s world, even if it is your money, you will have to listen to the permissions of the bank and authorities just to exercise control over your own money.
Political Impact of Bitcoin
The major reason national governments are sceptical of Bitcoins is because they undermine their authority. National governments consider it their own monopoly to control finances, monetary policies, central banks and other pieces of financial legislations.
The decentralized nature of Bitcoin makes it a threat to the sovereign authority of governments. They also feel that this is going to reduce their revenues in terms of conversion rates and other hidden fees. Most national governments are critical of allowing crypto transactions based on the above factors.
They also feel that Bitcoin and other crypto can help foster illegal activities and transactions. As the sender and receiver are anonymous, it becomes very difficult for the government to track them. This can lead to people using Bitcoins for drugs, arms trade and prostitution.
Of late, many national governments and financial institutions are giving Bitcoin a serious relook. They realise that criminalising it will only lead to its popularity. They have adopted a regulation and moderation approach.
Economic Impact of Bitcoin
It should be pointed out that Bitcoin is inflation resistant! In other words, unlike traditional currencies and investment opportunities, it is not subject to the laws of inflation. China’s government banning Bitcoin three years back was because of this reason.
Most Chinese investors were creating asset reserves in Bitcoins, as they were inflation resistant. This was not contributing to the growth of the economy at all. Hence, the Chinese government banned Bitcoins. Apart from this, Bitcoin and the crypto ecosystem has led to a massive surge in employment opportunities.
Several of the biggest private corporations have taken up Blockchain technology, as a model of study. They want to examine its feasibility as a channel for transferring large sums of money in quick time. Blockchain technology is fast, safe and an efficient way of transferring.
Every investor wants to get immediate access to Bitcoin investing. The year.2020 is going to be great for Bitcoin in terms of price rise and valuations. We can be sure that the social, political and economic impact of Bitcoin is only going to increase in the coming months.
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