Wealth inequality is at the tipping point of undermining the growth that we have experienced during the Industrial Revolution.

There are three ways that Ruchir Sharma notes how growth can be undermined. First, mass consumption is discouraged because as rich people save more, and there is only a limit to how much more money they can spend on material goods, and when less additional income would be spent (aka marginal propensity to consume) as compared to when wealth is spread more equally amongst middle and poor, the economy will slow. Secondly, corruption is rewarded. Sharma notes that political elites "steer government business and protection to favoured cronies" and divert funds away from efficient businesses and the most productive investment targets. Thirdly, a narrow elite is likely to provoke a revolt. 

At this stage, especially after this COVID-19 pandemic is fast passing through, and with 25% of America's money supply being eased into the system in just a few months, the equation has changed, only but slightly, to an even more resounding tone of inequality. Now, it is not about the poor getting poorer, but about the rich, in fact to be precise, the superrich, getting even wealthier (wealth accelerating at a faster clip).

A case in point here - in just 10 years, or one decade, despite the weak economy post-GFC (Great Financial Crisis) of 2008, the number of billionaires doubled from ~1000 to ~2000, with combined fortunes increasing from nearly $4 trillion to nearly $9 trillion. With wealth being concentrated in fewer and fewer people, their ability to influence policies and decisions in their favour at the expense of others will likely, grow. In India, in 2010, the top 10 tycoons controlled 12% of the entire nation's GDP. In a country's whose population was about 1.2 billion at the time of this writing, it shows how staggering inequality and wide the gap is!

Consider now the share of billionaire wealth to the rest of the 99.9% across various developed economies in 2019, which was just a year before COVID-19. Here is a table outlining it:

Britain - ~15%

Japan - ~15% 

US - ~30% 

Germany - >70%

France - >70%

Sweden - > 70%

ENTER CRYPTO

The crypto argument has been one of equality, helping in the proper redistribution of wealth, disintermediating rent-seeking businesses and putting money into the hands of the ones that are productive and value-creating. 

Non-fungible Tokens (NFTs)

Now, we have NFTs being minted by artists who needed to knock hard on doors of art exhibitions with no success, who can gain an instant audience with the world, and have the place to sell for crypto that is worth their weight in Ethereum (or whichever cryptocurrency is being accepted). Smart contracts settle the inefficiencies and levels the playing field. 

BitClout - The Twitter of the Cryptoverse

Now, we have BitClout that allows influencers to mint and draw a crowd from their efforts, before drawing eyeballs to that crowd. Will this reduce the need for the presence of controlling agencies to exploit talent whilst extracting value and discarding the talent when it is done with its vampirish, rent-seeking approach? Probably not. But it provides a field voted by the $BTCLT currency, and determined by others who emphathise and are able to lift a helping hand to elevate visibility and mobilise resources quickly. 

The revolution, like this one that this Magazine has, is one that takes power from bulging, bloated, hubris-laden media organisations and putting it into the hands of those who really do the work and add value through content. Fat cats who smoke cigars, eat caviar and sip whiskey will soon find their journalists, writers, media team, newsrooms, left with lesser talented pools of people, as the tables turn - the talented folks will turn vampirish, and extract value in terms of visibility for themselves before moving on to do their own entrepreneurial thing on BitClout with their own following.

Collaborations and smart contracts

Collaborations, you say? No problem, the rewards can be shared through a smart contract. Who needs a central manager who seeks to earn more than what each hard working, real content creator can create? 

Go down this trend of thought and logic and you will soon see how the smallest things can be dealt with just by employing a smart contract to negotiate, agree and proceed with a project.  

The community sets the rules, and every one plays by them. The people govern themselves by coming into agreement through smart contracts. 

Conclusion

We are living in a world that is evolving quickly into being crypto-first. This has come some way from being digital-first and you and I need to capitalise on the trend to move with the times. 

Chop chop now, get on your feet and get researching into how you can participate in it! 

Yours,

Chief Editor

BBA Market Perspectives

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*Not investment advice. Do your own due diligence before you invest!

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