Digital Currency and Social Transformation

December 18, 2017 at 4:51 pm

Earlier in the year we reported on the transformative potential of digital currency, and in particular the potential of Ether, an emerging blockchain-based digital currency. Part of the potential derives from the fact that one reason the poor stay poor is the lack of access to proper banking services. In some cases, traveling to a brick and mortar bank is a costly waste of time. Even worse, in other cases in many parts of the world, when a poor person is able to obtain a loan, he or she doesn’t understand the implications of incurring a high interest loan. A high interest rate can enslave illiterate laborers and they can easily be duped into bonded labor slavery. Such is the case for many of Pakistan’s 1.7 million bonded kiln workers.

Digital currency held in a mobile phone “wallet” can allow people to hold and transfer funds without the need for brick and mortar banks or for exploitive business owners. The use of digital currency M-Pesa in Africa and Asia since 2010 clearly demonstrates the practical value of this concept. The use of micro loans in digital currency can have a transformative effect both for the poor and for small businesses, as in the above video.

 

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