Creating Money Out Of Thin Air Is Magical

almost 3 years ago (Edited)

The world does not understand how powerful this truly is. One of the reasons is we never saw this before.

While many talk about the printing presses going at the Central Banks, the reality is far different. Money is not created simply by "printing" it. Instead, in our debt based monetary system, the banks are the ones who actually infuse money into the economy. This is done through lending.

In other words, to create "new" money someone has to take out a loan. That is either individuals or companies going to a commercial bank or governments doing something similar via institutional banks.

Either way, the money is really debt.

Source

The challenge with this is that for each unit of currency, there is interest tied to it. Hence, even if we pooled all the currency together, we could not pay off everything that is owed. This means there is built in failure since someone is going to be left holding the bag. It is like a game of musical chairs, when it stops, there is not enough for everyone.

There are many reasons why the present system is struggling. We will not cover them in this article. However, ultimately, the scarcity that is prevalent is causing major slowdowns over time. Cryptocurrency can change all of this.

We now have the ability to create as much money as we need. While this looks fatal on the surface, when we shift our thinking to understanding what is really taking place, we see how this can be a major boom for the global economy. In the end, it will help to feed into the major technological explosion that many are expecting.

In a scarcity based system, trade-offs have to be made. Banks are no different than any other business. Thus, they want to lend as much money as they can since that is how the profit. The downside for them is they want to be paid back. Hence, they have to balance wanting to put money out to everyone with the likelihood of getting it returned. Here is where lending standards enter the picture.

Ultimately, this means many people are left outside the system. For whatever reason, their scores will not merit the bank giving them the resources required. This stifles innovation since potentially productive ideas are not funded.

As we can see, in a debt-based society, this makes a lot of sense.

The next area to look is with money that is already in circulation. Here again, scarcity enters. While there are people out there who will fund things, they have the same problem. Anyone who lends money wants to be paid back. Therefore, one has to establish standards or make up for lowering them in some way.

When a lender lowers standards, they offset the increase in risk by asking for more upfront or putting a higher interest rate on things. Hard money lenders, for example, will loan to most anyone but it is very expensive. They are near loan-shark level.

In the end, we see the inability to spread the funding across the entire spectrum.

Source

Here is where cryptocurrency can fill a tremendous void. As more wealth is generated in the crypto world, the monetary system can shift from scarcity to abundance. We do have the ability to create money out of thin air. And, unlike what we deal with now, it is not debt.

Thus, anyone with an idea can tokenize it. Of course, it might not be something that gets much interest, meaning it is a concept that could require a bit more work. Nevertheless, the potential exists.

Ideas are limitless. People have them all the time. We live in a world full of problems. This means there is plenty that people can ponder in an effort to come up with solutions. A few of those could be extremely valuable to society, both financially and the benefits it provides.

Hopefully, this is starting to register how powerful this really is.

Money is really a tool for collaboration. It is a short-cut to getting things done. Instead of having to barter using goods and services, money allows us to streamline the process. If, one needs some coding done, there is a way to collaborate so both parties get what they need. There is no discussion about swapping a few cases of eggs for a certain number of hours of coding. Instead, a monetary price is put on the work.

Cryptocurrency enables us to do this with anything. Ergo, the collaborative efforts can keep increasing as more ideas are brought to the table. This will help to usher in a new era of creativity and innovation. The problem is not a lack of ideas but, rather, a lack of funding. The scarcity-based, banker driven system is comes up short on the funding end of things.

Obviously, this is such a radical concept that it is going to take some time for it to penetrate the psyches of people. We still are conditioned to think scarcity so the concept of being able to fund any idea is beyond us.

"What if I lose my money?" Do not worry, we will create more.

Success have value. Whether it is an application, a network, a community, or a company. Tokenization ensures that the holders are tied to the success of whatever the entity is. There is simply no way to separate the two.

Source

Does that mean every idea is successful? Of course not. There are a lot of dumb ideas out there. That said, some of the dumbest ideas do end up as wild commercial successes so we have to be careful on that end. Nevertheless, there is going to be failure simply due to human nature. We tend to reject that which does not interest us. Collectively, this happens resulting in failed ventures.

The difference is there will be a lot of ventures that are successful. When we step back and look big picture, we can see the financial explosion (as well as technological) that can take place. We have the ability to take collaboration to unforeseen levels. This will increase the overall productivity of the planet to a degree never witnessed before.

Money is not designed to be idle. Economies thrive when money is flowing at a rapid pace throughout the entire system. This allows people to engage with others, producing greater output than before.

Sadly, we are seeing the exact opposite with the present system. Money is starting to look like molasses, barely registering a heartbeat. This is showing up in the numbers as we see growth struggling.

Cryptocurrency is going to change all of that. We can count on the growth of this idea taking place. As more people realize the true realm of abundance, there will be a lot more ideas funded. This will, inevitably, lead to greater innovation. Over time, we can see this helping to put us on a much higher trendline in terms of our output.

And all because we can create money out of thin air.

If you found this article informative, please give an upvote and rehive.

gif by @doze

logo by @st8z