How Cryptos can help tackle Global Income Inequality

The differences in how much money people have around the world have grown significantly in the last few decades.

Many people can’t get basic banking services or high-end financial products and help that people with more money can easily get. Cryptocurrencies could help reduce wealth inequality by giving people who can use them a way to make, save, send, receive, and invest their money. In this study, we look at whether or not using cryptocurrencies would make people’s incomes less different.

Global Income Inequality,

How could crypto work for people with different incomes?

People use cryptocurrency to get to financial tools faster and send money to other people for less money.

Many people in developing countries depend on money from families to help them pay for day-to-day costs. Between 20% and 38.5% of a country’s GDP comes from the money people send home from places like El Salvador, Haiti, and Tonga. Stablecoins like USD Coin (USDC) and Tether (USDT) tied to the U.S. dollar can ensure that the people who get the money get more of it. Because there are no middlemen, who usually charge fees to move money, this is the case.

People save money when they send family members to work in another country. This gives them a better life. Since the fees are low and the transactions happen quickly, family members can send money home more often.

“But it isn’t enough that it is easy to get to and works well. Stop putting money in a bank and using their services to favor digital assets and self-custody. This is a step toward a new, more grown-up financial culture. It also keeps people safer, especially as societies become more digital and new threats to privacy and freedom appear.

Making it easier for people to pay in different ways

Even though PayPal is one of the most popular ways freelancers can get paid, users must have a bank account linked to their PayPal account to get their money. People can only take money out of their bank accounts. You can only do anything else with the money if you have a PayPal debit card. This could make it hard for people who don’t have bank accounts to make money online.

On the other hand, thanks to blockchain technology, customers can now accept payments without a third party like a bank. If a user has a cryptocurrency wallet, they can get payments from other users without going through a third party. People who work as freelancers online could find this very useful. For instance, if a freelancer is hired to make a website or do any other kind of online work, all they have to do is show their cryptocurrency wallet. The payment would then be made.

There are many easy-to-get tools that can help with money

By giving more people access to financial tools, cryptocurrency could help close the wealth gap. People who want to use centralized financial instruments like stocks, bonds, and indices usually have to sign up for platforms and provide legal documents like proof of income and bank account information.

On the other hand, people can interact with financial protocols like staking, yield farming, and platforms for lending and borrowing using only their wallets. This makes it easier for people with low incomes or who live in developing countries to earn interest on their assets and borrow money from others.  Visit official website for trading.

To put it another way, DeFi gives everyone access to all kinds of money tools. On a decentralized exchange, you can provide liquidity and get a share of the tokens that are traded, or you can stake stable coins and makeup up 20%. Users do not need help from a central organization to choose any of these options.

A currency that doesn’t gain value as quickly as others

Over time, inflation can make it more difficult for people to buy things with fiat money. This means that the money is more valuable and can be used to buy more. In 2010, one bitcoin was worth about $0.40, but now it’s worth more than $21,000.

Leave a Comment