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Many people see crypto simply as “online money”, where the only use case is to make payments over the internet. In my opinion, there is no need for this for the average person at all. They can do that fine (and easier) with the currency they have now. I see crypto and in my opinion especially Ethereum as a potential backbone of a global financial network.

Let me first explain a few views:
1: Bitcoin in its current form is too cumbersome for the average user / too expensive / too slow and uses too much energy. I see no future in it, except possibly as a “store of value”.
2: All crypto in its current form is complicated and difficult to secure for the average person. In addition, it hardly provides any benefits in their daily lives.

Below I will explain what I mean by the backbone of a global financial system. Here I will start with Ethereum:

We are currently reaching the limits of our financial system. Old systems are connected between all sorts of different banks, and therefore global transactions are often slow. This is especially noticeable in stores with large sums of money. This means that you also have to hedge against currency risks and the like. Moreover, as a developer you can not just build anything on this, because the systems are protected by the banks. So there are small opportunities for innovation.

Ethereum provides the opportunity to set up a globally trust-free and decentralized system. Why it matters: Untrustworthy so you do not rely on intermediaries, decentralized so that no parties can stop things. These are two important requirements for a global financial system.

Another benefit is by keeping these middlemen with power out of the fact that it can all be done much cheaper. Now one could say “but I’m fine with how the power is arranged now and I trust the current intermediaries, so what does this network offer me?”. Ethereum works with smart contracts and will therefore soon offer the option of programmable money. A lot of simple cases that still need to be handled administratively by people can therefore be handled automatically using a smart contract. But this, of course, offers many more possibilities, many of which we have not even thought of right now. Just like we did not expect how we use the internet for many things these days. A number of smart contracts. History teaches us whether it can be cheaper and also brings useful new features, it is simply impossible to stop it.

Well, we’ve talked about security and ease of use. But as mentioned before, convenience is also a big obstacle. In my opinion, this system will soon just run in the background and as a normal user you will have nothing to do with Bitcoin, Ethereum or anything. Everything just goes in your own local currency and is instantly converted in the background. Like most people now have no idea about TCP / IP or HTML when they visit a website. All of these protocols run in the background.

But why is it economically interesting to have Ethereum? The processors of the transactions / validators naturally want compensation for the work they perform for the network. Ethereum is the gasoline that makes the system run. If this system actually becomes the backbone of the next financial system, you can imagine that there will be much more demand for “gasoline”.

But can a bank / state or someone else not just make a coin? Yes, that is possible. But would Russian / Russian companies want to use a system controlled by the US or a US bank? and there are many more examples. No, therefore the system must be decentralized and untrustworthy. Of course, this is not necessary for Ethereum, but to date it is the most robust and advanced network with a fairly large corporate backing. That in my opinion it is the most logical possibility.

“I understand the usefulness of blockchain technology, but I do not understand why a coin should be attached to it.” The people who help run the network would also like to pay for it. If they get paid in the form of crypto attached to the network, they actually have something to lose if they do not perform their duties properly. This increases the security of the system. Assume that a party will try to crack the system, then they will have to put so much money into it that it actually costs more than it can ever provide.

Finally, this is not a selling point to persuade people to buy crypto. If you do not understand it, do not do anything about it. It was written to explain why I see a future in it.

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