Opinion Writers

The future of money is here and we must embrace it

  • Cashed in: the bitcoin may become all the next generation understands about currency

The bitcoin and cryptocurrency intervention has brought a new layer of a technological mystic, particularly to the older generation and those of my era who are still grappling with simple things, such as how to answer a smartphone — a task that our four-year-old grandchildren can easily manoeuvre.

This new idea of currency and business transactions is so radical, it has the potential to completely overhaul the issue of currency transactions in much the same way the World Wide Web transformed access to information from the past days of the encyclopaedia.

I can very clearly remember the days of having to search through the archives and research libraries and magazines such as National Geographic for information that is now just a few clicks away on the Google search engine.

Just one more thing to affirm our redundancy, further removing a considerable portion of the population of modern societies to retirement villas; in fact, making general society in some fashion an entire retirement village, as the older folk gather in coffee shops and talk about a world they once knew.

The bitcoin one day soon may become all the next generation understands about currency. Money may become as foreign to them as the term “party line” that none of my children know about — are those phones with party lines or switchboard operators?

Things are moving so fast I recall a few years ago talking with a cousin 20 years my senior and wanted to communicate some important information to him. So I asked if he could provide me an e-mail address, to which he responded: “Fax it to me.” I had almost forgotten fax machines still existed. He was an advanced businessman in his day, but is now completely out of the communication loop.

The core principle is the issue of trust. Trust is the only thing that gives value to the money we use at present. It is because of that trust that when we trade it in, we will get the value stated on its face. The reality is that the dollar or paper note is a “promissory note” with a stated value, but more to the point it has been given the “trust” of the authorities.

If the bank loses trust in the value, then it goes down. Bitcoin decentralises the authorities and removes the third party relying on the “trust” between two parties with the everlasting fingerprint of the computer holding the transaction, but the key value is trust.

I don’t know the efficacy, but can easily comprehend the global shift and conflict that this revolutionary trend can and probably will make in the world. There will be casualties because all start-ups bring risk and challenges. There will be huge resistance to change; freedom has a cost. It’s not just doing business, it’s essentially challenging the existing order led by money.

The car challenged the horse, the steam engine challenged the sail and at one time scientists used to say that a rocket will never escape the Earth’s atmosphere.

The issue is not whether we will move to a new economic paradigm because of the computer, it is when.

Again, it is not whether decentralisation, freedom and voluntary trust will be the way of the future, either; it is how many lives and what and who will be the casualties that lay in its wake before we get there.