We are entering a completely new era in humanity. Things that were constant in our daily lives are changing. It is a process that operated on the time frame of decades, yet could be consolidated to years.
For example, 30 years ago, the Internet was not part of our daily lives. Today, however, for more than 5 billion people, it is a part of our experience just like electricity is.
Advancements like this are opening up many new opportunities to people.
One is the idea that everyone can be financially free. This is something that eluded most of the population throughout history. Instead, our lives were filled with the struggle for sustenance. With some of the developments taking place, this script is being rewritten.
To start, it is best to get a definition of financial freedom. This is going to be highly subjective but this is the one that I prefer:
The ability to sustain oneself (pay the basic bills) without having to work.
If one achieves this end, he or she is financially free. Of course, the person is free to work if that is desired. The key is the paycheck is not the sole reason for going down that path. This individual also has the freedom to choose the type of work involved in.
It sounds like a worthy goal and also a pipedream for many. However, this is the plight of the wealthy. For most, they have the means far beyond sustaining themselves. At the same time, many, if not most, opt to keep working even though their resources will far exceed their lifespan (short of being extremely stupid with their spending).
From a societal standpoint, how can this be achieved?
This boils down to either making everyone wealthier or driving down costs. Essentially, wealth is buying power. It reflects what our resources get us.
Obviously, this can vary greatly depending upon geography.
What is fortunate is that we are embarking upon a time when the above solution is not employing one of the conditions. Instead of either making people wealthier or driving down costs, we are getting both.
Basically, over the next decade plus, the individual income statement is going to see a rise in the income (the left side) and a reduction in the expenses (the right side). This will only accelerate the entire process.
Many involved in cryptocurrency believe it will be the greatest wealth generator in human history. The early days of the industry certainly reflect that. At the same time, we are seeing the ability to distribute the wealth on a much broader scale. People are getting involved with nothing yet are starting to build a foundation of assets.
This is leading many to pull in more money than they previously did. Even if it is in addition to their existing income, it is moving them towards financial freedom.
One of the big keys is the way that activities, especially online, are being rewarded. Cryptocurrency has the ability to monetize any activity. This means that, in the future, a lot of what we do for free will be an income producing activity. The recent addition of NFTs, providing digital ownership, is another step in generating wealth for individuals.
Decentralized Finance (DeFi) is also another area that is garnering a great deal of attention. This is a sector that is opening up financial services to the world. Once again, we see the present financial system exclude most people. As the system evolves, along with people amassing more value in their holdings, they will be able to collateralize their assets for other things. This can potentially provide a lucrative return.
For example, imagine being able to collateralize a mortgage with one's Bitcoin holding. The loan is paid back in some other token (currency) yet the Bitcoin is still retained. Thus, any increase in the value of Bitcoin is accumulated while the loan is being paid off.
We also could see the lenders be thousands of people from all over the world seeking a return on their money. With fractional lending, the average person might put in a few hundred dollars towards the loan.
And this is all done without gatekeepers or rent seekers.
There are going to be untold number of opportunities for people to enhance their "cashflow" via cryptocurrency. Over the next few years, the innovation, especially as it pertains to finance, is going to explode. This will offer a much different financial future to billions of people.
Here is where things get very interesting.
Digitization is extremely deflationary. As soon as something enters that arena and falls under information technology, the prices plunge. This is what provided us with reduced costs in things such as computers, robots, televisions, and entertainment.
The key here is this process is just getting started. We are seeing the same concept spreading to many different industries. Today, we are early on in the process yet, within a decade, things will be completely different.
When we look at the production of much of what we need, there is disruption taking place everywhere. This will affect the prices of food, housing, education, and clothing.
If one wants to keep up on what is taking place, follow 3-D printing, robotics, AI, EVs, and renewable energy. All of this is going to factor in across the board price reductions for most items. It is important to remember that all of those have digitization heavily factored in.
For many industries, we are dealing with Version 1.0. The first generation of technology tends to be clunky, slow, and expensive. That changes as upgrades are done. Then we see the ability to scale take place as speeds increase, efficiency is achieved, and prices come down.
This is a radical difference for the majority of humanity. As we progress further into this decade, this will become evident to more people. Technology is forging ahead at a massive pace, disrupting most everything we can think of. This is where the right side of the income statement is going to benefit.
Complex systems tend to keep expanding, thus generating even more complex systems. When this happens, much of what applied to the previous systems is negated.
We are seeing that today with many of the ideologies, policies, models, and approaches rapidly becoming insufficient. Those are are holding onto ideas for the 1990s or earlier are going to find that they are unaware of what is taking place.
It is better for people to lack onto the new concepts that are emerging earlier if they can. Getting a head start on where things are going is extremely important.
This is why early adopters tend to be rewarded to a greater degree than those who join later.
Either way, all are going to benefit from this shift that is taking place. We are on the cusp of a technological explosion and cryptocurrency/blockchain is right in the middle of it.
Those who are building along these lines are going to find themselves in a much different position, if they haven't done so already.
Financial freedom will be within everyone's grasp.
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