Centralized finance is the backbone of our world's entire financial system. These institutions serve to mediate any monetary concerns, and have essentially been unavoidable for the last few hundred years (unless you stuff cash under a mattress).
We've fed banks all of our dough, and they've gotten fat. All of us are raised to put our hard earned cash in a bank account and hold it there. It's seemingly the most secure way to hold the representation of our societal contributions, the backbone towards our sustenance. Our parents said it, and our education confirmed the idea. Plus, money pays for our food and that little plot of land that we fight off of. We make a living and fulfill our material desires with this 'dollar'.
That mentality towards finance has been so cemented in our lives that it's challenging to question any reality that opposes it. Centralized banking is the norm, and has been for a long time. When the stock market crashed in 1929, many people lost their entire life savings. Big daddy government stepped in after it was too late, establishing FDIC insurance policies that still remain to this day. Nothing has changed.
The only way that a marked change occurs in our system today is that enough people are pissed about it. In the beginning of the 20th century, populism was on the rise, and a call to a silver standard (versus the gold standard that was in place at the time) was a talking point of people who considered themselves socialists at the time (pretty different by today's standards, ha!). Fast forward to today, and we have no standard for our fiat currency (government issued money not backed by a standard, like the US dollar). When banks failed in 2008, they were bailed out using billions of our tax dollars. When senators want to include earmarks or other provisions in our government's bills, they fund these with our tax dollars, regardless of whether or not they benefit their constituents or the resident oil company.
Occupy Wall Street was a countermovement to the actions of the United States government during the 2008 recession. It fizzled out, and things have only gotten worse since then.
In 2020, when COVID-19 all but ruined any business with a social aspect to it, large corporations were bailed out under the pretense that they oversaw the livelihoods of the thousands of people that work for them. At the same time, many independently owned small businesses failed. How did these corporations survive but small and community based businesses go under?
You guessed right if you said our tax dollars!
Why did I explain all of that? What was the real reason?
It was to hammer in the idea that there's no accountability with the US Dollar, so that someone who's never even considered such a thing before could understand the scale of the issues that it causes. You heard me. Zero, nada. Magic money printer "go brrr". As much money as humanly possible can be printed as long as fear doesn't govern the economy and cause large funds to dump their precious shares.
Here's some more evidence for the cynics out there:
As Brett Schrotenboer for USA Today says: "with a few strokes on a computer, the Federal Reserve can create dollars out of nothing, virtually "printing" money and injecting it into the commercial banking system, much like an electronic deposit." He also quotes Ron Paul, who calls it a whole bunch of "fake money", with a "fake measuring rod" that determines everything from our perceived wealth, our perceived success, and to those materialists out there, our perceived well-being.
The entire process isn't as simple as printing money and throwing outside the Federal Reserve building for random people to pick up. More info can be found in Schrotenboer's article. However, the above explanation does encompass the damaging effect of "stimulating" the economy with reckless money printing. The implications this has on a society and culture that worships material "things" is the topic of an entirely separate article (to explain it here would lead to a lengthy tangent).
So, when people tell me that "crypto is gambling", or that it's simply internet money with no use... I laugh in their face. "Fine," I say. Keep all of your mystical Monopoly money locked in your central bank whose main goal is to profit off of you, who was saved 13 years ago by a government that wants to tax you.
On the flipside, Bitcoin's structure and fundamentals give it more validity than any fiat currency that exists, apart from said fiat's usability. Blockchain-based currency provides an alternative that cuts out the greedy middleman: the banks and the government that has funded them through every crash. Instead, the mathematics behind the functionality of the blockchain serve as the mediating entity. Bitcoin's blockchain visibly shows every transaction that happens on the network, verified by miners who receive network fees in return for their work. The value of Bitcoin also lies in its transparency and accuracy of recording transactions.
Other cryptocurrencies exist to improve on the formula established by Bitcoin, like Ethereum and its smart contracts. Now, this is only poking at the top of the crypto rabbit hole, as there are many projects that seek to improve this newly developing ecosystem (like Decentralized Finance (DeFi), but explaining this would be another drawn out tangent).
And no, I will not be shilling any of them here.
There are facets behind the scenes that are supposed to give any currency an underlying value, how this is achieved is essentially what makes many cryptocurrencies differ from each other. However, any legitimate currency strives to achieve usability by ascertaining an important function that didn't exist before. They also need accountability (think of the blockchain), and something like a supply cap so that aspects of the coin like price and inflation/deflation rate cannot be manipulated (cough, cough).
Consider this example: when I send Bitcoin to my friend, the backend is there. Heck, if I handed him a piece of gold for his turkey sandwich, the gold has underlying value through scarcity and the universally perceived rarity of gold. The turkey sandwich has value to me, because it makes my stomach full. When I hand him a five dollar bill, it might have perceived value to him, but in reality it simply doesn't have any. Yes, he could use the fiver to buy some food, but that's where the conundrum lies.
That article linked above has a great definition of how value is defined, by the way.
While we're all soma'd out from our tunnel vision, elitist entities can abuse our financial system and proliferate money as they please (for more info, do research on how some large hedge funds short more shares than the amount that actually exists). And no one cares because they can't see it happening in front of their eyes, or through a manicured news story.
We only think of the perceived value because it affects our lives in front of us. However, we fail to collectively realize that the fundamental value of widely used currency like the US Dollar are bunk and allow for rampant abuse.
Just because everyone uses it and your job pays you in it doesn't make the money have real value. Many cryptocurrencies exist that champion accountability, preventing blatantly hostile printings, ulterior motives, and general misconduct with said coin. Cryptocurrencies like Bitcoin are so important because they provide the modern individual with a form of money that serves the people who use it, not the people who distribute it.
It's time to switch to an ecosystem where our money has intrinsic value.