Things change, money evolves. Two to three decades ago, you were obsessed with toys, and they were your top priority. However, now that you've grown older, you have more pressing concerns. One thing about humans is that they adapt to change over time. Just like everything else in the world, the monetary system in different countries is constantly changing.
Looking back to the days of our forefathers, they utilized a system called Trade by Barter. Of course, I wasn't alive during this period, but my economics teacher taught us about it. You'd go to the market with your goods and exchange them for others. For instance, you'd take rice to the market to exchange for yams. One of the problems with this system was that it was difficult to measure the value of goods. If I went to the market with 5 cups of rice and wanted yams, how many yams would I get in return? This is one of the problems that led humans to develop other methods of transaction. From trade by barter, the transaction system developed to the use of silver and gold as a medium of exchange. Unlike trade by barter, this system was easier and more efficient. As years passed, this system evolved into the fiat currencies we use today.
Today, countries have different currencies. While this has so many advantages, it also has disadvantages, especially when it comes to buying and selling across borders. Let’s use a Nigerian and an American trader as a case study. Imagine you're a Nigerian trader and you want to buy goods from a supplier in Japan. You'll need to exchange naira for US Dollars, which can be stressful. Not only is the exchange process stressful, but you might also lose some money to fees. This makes it difficult for traders to buy and sell across borders. However, over the years, cryptocurrency has taken over the world, making it easy for people around the world to make transactions without facing struggles. Not only is this method fast, but it also requires less fees compared to other systems. Now, the big question is: Can the world run on crypto alone?
Is it possible to create a world where fiat and banks no longer exist? A world where you have full access and control over your money, without governments placing restrictions. On the surface level, it sure would be nice to have control over your money. However, this topic is more complicated than it seems. One of the advantages of a crypto-only world is that you'd have total control over your money. Countries around the world make use of fiat currency and one common thing is that they are controlled by the government. Having to deal with transaction limits can be a hassle. Imagine waking up one morning and seeing that your account has been frozen by your bank and you'd need to go to the bank to rectify it. However, a crypto-only world means you'd be the boss of your own money and no one would control how you use it.
As I mentioned above, the idea of a world without government monetary policies seems good on the surface level. However, taking a deeper look, there are some disadvantages. It would be impossible to establish this system, especially in poor and developing countries. For example, it would be impossible to establish this system in countries without electricity or internet connections. How do you expect people who have never used a cellphone to know about crypto, to talk more about making transactions? Another problem involved is skepticism, especially from elderly people. Here in my country, when people, particularly elderly ones, hear the word, “Crypto,” what comes to their minds is scam! Fraud!
In 2023, the Nigerian government decided to change its currency. According to the CBN governor, the naira had not been redesigned for over 20 years. Also, there were no clean and fit naira notes. The government disbursed too few notes into circulation, and this became a problem for the people. There was no cash in circulation and people struggled to buy things. Since there was no cash in circulation, people relied on mobile banking. But the market women? It was impossible to transact with them as most of them had been using cash all their lives. Now, imagine if a crypto-only system was established in a place like this. It definitely would cause chaos.
In summary, a crypto-only world is like a double-edged sword- it has advantages and disadvantages. One of the advantages is that people would have total freedom over their money. On the other hand, many countries do not have access to operating such a system yet. In my opinion, the world is not ready to completely eradicate fiat in place of crypto. Maybe this will be possible in the next 20 years. For now, it would be best to operate both side by side.
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