The forceful advent of blockchain and cryptocurrency in all its facets has open our eyes to a lot of opportunities and possibilities which have given us a chance to control the way our money is created and together foster wealth and exchange based on community and peer to peer transactions. The decentralized, public and peer to peer system has enabled us find new opportunities independent to a large extent of government and institutional control and restriction. This grants the individual a chance to be himself and commit to making the price of his life worth the product he put into it.
We cannot however forget that there is no individual without communities as we need each other to survive. Hence, how can we actually in the real sense attach this decentralized system to real community applications example a national economy.
Well, the cryptocurrency is a simple working process of complex codes. How can this form of money be integrated into our economic system so that while it actually takes the power of economic control from the government, it will give the citizenry an opportunity to by their economic activities, trade and investments determine the value of the national currency rather than a system of fixation by a certain bureau regulating the currency of the nation? Ideally, the economy of any state is meant to be regulated by the forces of demand and supply and bitcoin has created a global economy entirely regulated by demand and supply hence the value of bitcoin is not fixed by an individual or group but by the community of persons participating in trade, exchange and transactions using the cryptocurrency. Its value is also not determined by the value of other currencies unlike conventional national currencies which are often staked to the value of the dollar.
For this to work, we will need a complete dissolution of the central banking system. Then the government will create a national block chain based currency, which can be traded by citizens and its value determined by the level of demand and supply. This will run entirely like a stock market without a central stock exchange. Each aspect of the economy like health, energy, etc, will have its own token and exchange platform on which trading can be carried out as regarding resources that come under that aspect. Hence, the value of each aspect of the economy sum up to determine the value of the entire economy and the cost of products and services in the market all determined by the level of demand and supply as trade takes place on both the local and the international market. No one would need a bank or a financial institution to carry out financial transactions. All transactions will be carried out online and entirely independent of any institutional control. Taxes can be paid, salaries and even the least of bills can be paid on the platform. International trade can also be transacted and the strength of each nation’s economy will be determined by a simple economic principle; Demand and Supply.
The government may however for the sake of safeguarding against malpractice and misuse set up an independent regulatory institution to ensure that no person tries to hijack the system. (This may however be unnecessary as the its blockchain security feature is enough regulation). Hence, worth will be determined by actual value created and not fixed by individuals who know nothing about the travails of people that work to create such value.
What are the benefits of this to a national economy? 1) Independence from individual or group control 2) Check corruption and theft of government resources 3) Cheaper way of value dissemination 4) Easier and more efficient means of sharing the state resources. 5) More control and self determination for the people. And many others.