Author: Asira S

Translation: Baihua Blockchain

Cryptocurrency is attracting widespread attention globally. El Salvador has designated it as legal tender, requiring merchants to accept it just like cash; meanwhile, blockchain summits in the United States are drawing billions of dollars as companies rush into the Web3 space.

Behind this craze, cryptocurrencies like Bitcoin and Ethereum mean much more than just money; they are redefining how currency operates.

However, the complex terminology and overwhelming information leave many feeling confused, as if everyone assumes you already understand. In reality, many are still struggling to grasp the true value and significance behind cryptocurrencies.

So, what is decentralized currency?

Imagine if Venmo, PayPal, and your bank disappeared overnight, how would you transfer money?

This is a reality for millions of people worldwide.

But the issue is not just about accessing banking services (though that is a big problem). It’s about who controls the currency itself.

Right now, when you make a transfer, you are not really transferring it yourself. You are requesting a bank or payment processor to do it for you. They are the middlemen, charging multiple fees, deciding who can or cannot use their systems, and having the authority to freeze or block transactions at any time.

Decentralized currency eliminates all of this. Simply put, you can transfer money directly to others through a digital wallet without going through multiple banks. A blockchain, made up of a global network of computers, verifies and records transactions through cryptography and code.

No company, no country, no CEO can intervene to stop it.

Unlike banks, decentralized currencies like Bitcoin, Ethereum, and others operate around the clock. There are no business hours. No waiting for “processing time.” Banks don’t even take weekends off.

This is not just a matter of speed; it’s a matter of control.

Why is decentralized currency important?

For the first time in history, people can send, store, and control their own funds without the approval of banks or governments. If you live in a country with a stable banking system, this may not seem like a big deal. But for millions, decentralized currency equals survival.

1. No one can freeze or block your funds

Countries and banks can (and do) freeze accounts whenever they deem it appropriate.

Take Canada in 2022 as an example. During the trucker protests, the government froze the bank accounts of protesters and donors without a court order. Or Nigeria in 2020, where the government shut down the bank accounts of activists supporting the #EndSARS movement (protesting against police violence).

In both cases, the government believed it was necessary to do so. But at what cost? When you take away a person's money, you deprive them of the ability to eat, pay rent, and survive.

With Bitcoin and decentralized currency, this situation cannot happen. If your assets are in a self-custodied wallet or traded through a decentralized exchange (DEX), no bank, country, or company can freeze, block, or confiscate them. This suddenly becomes not just financial freedom, but a basic human right.

2. Serving the unbanked

Now think about this: there are 1.4 billion people globally without bank accounts. Not because they don’t want one, but because they live in places without financial infrastructure, lack proper identification, or are restricted by their governments.

In El Salvador, before Bitcoin was adopted as legal tender, over 70% of the population did not have a bank account. Now, people can send, receive, and save money without a bank.

For billions, decentralized currency is not just an alternative; it is the only viable option.

Moreover, beyond basic banking services, decentralized finance (DeFi) is becoming a powerful alternative to traditional financial services.

3. Potential inflation protection

Even if you can access banking services, inflation erodes your savings. Inflation means that the things your money can buy decrease over time.

Countries control traditional currency, and when they print more money, the value of the currency decreases. This is exactly what has happened in Venezuela, Zimbabwe, and Lebanon, where inflation has destroyed people's savings.

Bitcoin has a fixed supply of 21 million coins. No country can print more, and no central bank can arbitrarily change the rules. This is why some people refer to it as “digital gold.”

In the short term, price volatility is rapid. But in the long run, some believe that due to its fixed supply, it will become a strong store of value.

Bitcoin is not yet a perfect inflation hedge. But it is an alternative currency that is not controlled by any government. For many, that is enough to draw their attention.

Decentralized currency changes everything

Bitcoin and decentralized currency mean much more than just financial implications. For some, they offer a cheaper and faster way to transfer money; for others, they are potential inflation hedges; and for millions around the world, they are the only way to access financial services.

Cryptocurrencies and the technology behind them are not perfect and do carry risks, but they are pushing us to rethink how currency operates. For the first time in human history, people can access a financial system that is not controlled by banks or governments.

Regardless of our attitudes towards it, decentralized currency is already shaping the future.

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