Chris Dixon, an American investor, internet entrepreneur and general partner at Andressen Horowitz Venture Capital Ltd; is a renowned authority and recipient of the 2010 Bloomberg L.P. award for top angel investor in technology among other achievements.
Countless times over, Chris Dixon has expressed his support and optimism for cryptocurrency and Blockchain technology; with special focus on Decentralization, New technology and his clearly stated Eras of currency.
According to him, there are Three (3) Eras of Currency;
- Commodity Based (Gold)
- Politically Based (Dollar)
- Math Based (Bitcoin)
The above eras depict the transforming stages in currency progression with Chris Dixon specifying we are at the Math Phase in currency adoption.
Just like in every other human-relations sector, advances in technology, need for streamlining of processes and losses, need for efficiency and total consumer control have all led to innovations in these sectors through the adoption of new technologies and systems.
That said, we look to analyse these currency eras as deduced by Chris Dixon, their features, flaws and transformations.
The traditional financial system shows a flow of advancement from early barter trade which started in Egypt involving exchange of goods for goods, to a Gold (commodity based) financial system of exchange involving the use of raw materials, commodities or most pronounced precious metals (cowries, Silver etc) as methods of payments and transactions.
This Era lasted and served its purpose right until about 1290 AD when increasing need for simpler, lighter, more valued payments and Identity relative financial systems became necessary with the introduction of corresponding technology.
With advancement in technology and in a bid to ensure sovereign identity, governments over the world looked to create their own autonomous means of payment and financial system.
Politically based currency termed ‘legal tender’ varies among given national boundaries but is not backed by a physical commodity. Governments through state owned banks and other financial institutions sought to regulate and own this currency.
This need to dominate and maintain control over resources and finances led to the introduction of physical monetary systems using coins and fiat (paper money) with technologies such as ATM, Internet banking, E-money among others.
Besides their perceived ease of use and flexibility, the introduction and adoption of these fiats by government were basically politically motivated. With every government looking to control the monetary flow, economic and financial activities within their jurisdiction while also maintaining sovereignty of identity under various fiat; from Nigerian Naira, U.S. Dollar, Japanese Yen and many more.
The political based era of currency transformations also featured attempts at dominance as to what country holds the world’s monetary and economic power with the U.S. dollar currently calling the shots.
This era still lingers and has served its purpose but not without current issues from rising inflation, manipulation, failed economies, huge national debts and many more setbacks.
The Math based era is an emerging era of digital payments hinged on Peer-to-Peer transactions, devoid of banks or third party intermediaries, offering a fully digitized and contactless economy. This era focuses on transfer of value seamlessly across the internet with less fees and more visibility through a single decentralized and distributed ledger platform using Blockchain technology.
As supported by Chris Dixon, this math based era is the future of money; as it promotes accountability through its decentralized nature hence no single entity or government can manipulate it. Math based currency allows users, individuals, citizens and all total freedom and control over their finances and currency holdings.
According to Chris Dixon’s assertion, this Math based era is the CRYPTOCURRENCY ERA, the BITCOIN ERA as launched by Satoshi Nakamoto in 2009, and the BLOCKCHAIN TECHNOLOGY ERA.
Math based currencies are an emerging currency, based on an emerging technology. At this time, the use of this Math based / cryptocurrency is limited and partly restricted by a few dominant authorities; just as the Internet was restricted in its early stages right until full adoption due to its benefits.
Even at its early stages, cryptocurrency has lived up to bidding, providing autonomy, financial freedom, ease of transactions, instantaneous payments, cheaper fees , huge profits among other benefits over political based currency.
Math based currency is in its early adoption stages. ⇒(0.0008 BTC)
The numerous benefits of the Math based currency era do not totally paint a perfect picture, as in all sectors it also possess its own short comings. However, its gains outweigh these seeming deficiencies; and quite laudably, the era and its technology is only in its infant stages hence, it can only get better with more tech, adoption and utility.
As opined by Robert Kiyosaki (popular author of Rich Dad, Poor Dad and finance expert); there are also three (3) types of money:
- Nature / God’s money (e.g Gold)
- Government money (e.g Naira, Dollar; which Kiyosaki believes would fade away soon)
- Peoples money (e.g Bitcoin)
Cryptocurrency is the people’s money. It gives control and financial power to the people.
Bitcoin is currency for the people.
Article is solely of the author (Sagesetwriters) for BTC.ng, copyright charges apply.