INTRODUCTION:
The world is constantly changing every day, politics is changing, traditions are changing and currency is changing as well. Cryptocurrencies have taken over the business market and the digital currency Bitcoin is the most popular one. Bitcoin can rather be a solution to the degrading global economy. Let’s check the effects of Bitcoin on capitalism but, before that let us get a background of Bitcoin.
ABOUT BITCOIN:
Powered by the complex blockchain system, Bitcoin is a type of cryptocurrency that is decentralized. The blockchain technology of Bitcoin confirms and verifies transactions made through a decentralized computation that has to be solved by several computers. The miners who solve these complex mathematical problems through their technological skills, earn rewards in the form of Bitcoin.
- The transactions performed are all public which further ensures the safety of the cryptocurrency. There is no further involvement of a central authority and it is decentralized which reduces transaction fees to almost zero. The coins or tokens are stored safely in digital wallets which is a kind of software that holds the coins of Bitcoin holders. Bitcoin trading can be a chaotic activity at first but there are apps in the market that helps Bitcoin traders to take adequate steps, bitcoin investors is one such app.
- Along with the advantages mentioned, there are some disadvantages also. The market price of Bitcoin is fluctuating most of the time. In other words, it is highly volatile which makes it very unpredictable.
- In the present world, the chief way of investing in Bitcoin is by selling and purchasing them. Conventional future markets are starting to get involved or rather reopening their doors for Bitcoin. The CME Groups and Cboe Global Market are the major groups that have launched future markets on digital currency. These future markets are anticipated to draw more established investors into the Bitcoin space.
WHAT IS CAPITALISM?
Capitalism is an economic arrangement where the mode and resources of production are owned privately and this production is most of the time designed for profits. The features of capitalism are:
- Profits and accumulation – in this, growth is fueled by more growth for the sake of profits.
- A two-class system and wage labour – the two classes in capitalism are the capitalist class that controls the ways of production and the working class, that works for wages.
- Freedom for capitalist – capitalists are permitted to act on their will and choice.
REASONS FOR POOR REPUTATIONS OF CAPITALISM:
- Monopoly – there is little or no government control on capitalists which results in a free market where a monopoly exists.
- Corruption – the unchecked nature further gives rise to corruption.
- Inequalities – the capitalists are overpowered and gets richer with dishonest practices. People favoured by nepotism and non-competitive people get an easy entry into the market whereas the deserving people are held back.
- Cronyism – the government assists the capitalist class as this beneficiary for both the state and the business class as well.
ROLE OF BITCOIN IN IMPROVING CAPITALISM:
- Opportunity for all – anyone can earn profits from Bitcoin irrespective of the background they belong from. The decentralized finance ecosystem or DeFi is the reason owing to the success of Bitcoin.
- Decentralization – there is a distributed organization of governance employed by Bitcoin. This leads to a fair system where everyone’s voice is heard.
- Transparency – the amount of Corruption in Bitcoin is zero. There is no option of making fake money because only 21 million Bitcoins are circulated among users, the price and supply can never be manipulated by anyone.
CONCLUSION:
Capitalism is considered to be a better economic belief. Bitcoin is still at its early stages but with better development, Bitcoin can serve as an unbiased economic framework in the future.