15 Nov 15 - 01:39

Let’s take a break for a moment from the long ranting posts about how evil banks are and how they’ve lovingly guided as into an abusive system that we’ve grown to rely on.

That’s not what this post is about. I’d like to rather write about something more important.

I want to write a small piece about the social impact that bitcoin will have on the world. The technology is still very young, but it’s potential reaches far beyond a simple means of transacting without the need to be “online”.

Let’s start with a broad example of transacting across borders. Unless you’re using PayPal, the only possible method currently to send or receive money abroad is via your bank. If you’ve done so recently, you’ll know that it’s a costly transaction and if you’re a business, there are a lot of hoops to jump through, just to prevent fraud, money laundering etc. You’re effectively being treated as if you were a criminal that cannot be trusted. But we accept this because we have no other choice.

Not only that, the amount of hands that your money needs to theoretically pass through to get to its destination adds unnecessary costs to the transaction. Let’s not forget that there is a lot of privacy being lost in this transaction. By no means do I want to seem paranoid but there are genuine cases where it would probably be best if certain people did not find out where your money is going to. Think about the implications of an Egyptian financially supporting groups providing internet access to the protesters. If the outcome had not been in favour of the people, these Egyptians could have been facing some unpleasant consequences.

That aside, if the transaction was as easy as giving a friend some money, from your wallet into his, while you’re at a bar, the transaction costs will be 0 and your friend receives the money easily, without having to explain to the reserve bank why drinks are now on him.

Transactions between two or more parties truly becomes peer to peer again.