When the Wright brothers were making their first flight, I’m sure a lot of people just shrugged, they were still going to walk to work everyday, airplanes weren’t going to fix that. Despite being a completely new way to travel, the “use-case” was questionable because it hadn’t advanced enough. When I try explain bitcoin, one of the first questions I frequently field is,”how is it better than what we already use?” So, they ask, why is bitcoin better than their credit card, attached to a bank, sending funds through trusted servers that they have never really had to think much about in the first place. To their credit, this is a hard argument for me to make for a couple reasons. Most of the ways we do payments is to compensate for the limitations of the financial tools that we use currently. Placing bitcoin into our current system, without scraping all the limitations that seem fundamentally normal, is not a very compelling vision. Envisioning the future that will mold itself around the incredible flexibility of crypto-currency requires reimagining how the world works. So is Bitcoin going to make it easier to buy coffee, they ask? Maybe not, but imagine never having your credit card stolen or lost again, because you don’t need a piece of plastic with a set of unchanging numbers. Imagine never being charged bank fees, or not needing a bank in the first place. Imagine being paid by someone in Australia to do a job without them ever asking your name or where you live.

The rise of the internet offered us the idea of a world without borders, where knowledge was free to be shared. What we have come to realize, though, is that content and knowledge also needs the free flow of capital. Our current system is not designed for the free flow of money and assets. The reality is that our global monetary system is more like a set of private roads, tolls, and a whole set of obstacles that are meant to extract value and control where money can and can not go. The governments and the private industries that control these roads will tell you that you need them to be safe, that they are the good guys, and you need someone looking out for you, in exchange for a small fee of course.

When everyone is being forced to drive on these private roads, there is little incentive structure to reduce the tolls more than is necessary. Of course you don’t want to make it so expensive that no one drives, but the owners of these highways design friction as both a way to control capital and make a few bucks themselves. This friction is often completely arbitrary, a product of politics, created by small groups of individuals, overseen by weak government oversight, and vulnerable to outside attacks. Despite all this, most people don’t think about what is happening behind the scenes when they buy that coffee, as long as that charge goes through. In general, as long as things are going right, the problems aren’t as clear, and seeking a substitution seems pointless. But as we do know, things do go wrong. Prices don’t stay stable, inflation rears its ugly head, the governments that back our fiat currency sometimes collapse. When turmoil or disaster erupts , access to our funds can be cut off. How many of us print out our bank records still? Not many, we just assume that we can login, and get an accurate statement of our wealth. These are private systems, while possessing redundancies/backups, every precaution used costs these companies more money. None of this is invincible. We try to assure ourselves that with varying kinds of insurance, it will all be alright. Then we see instances of insurance companies misunderstanding risk, and financial institutions entangling themselves in assets that even they don’t fully comprehend. Even when our moderators are good intentioned, they make mistakes. There are only so many analysts that these companies and institutions can afford to review their risks, identity insecurity, and reduce friction in the system. While some industries can benefit tremendously from open source, you can’t crack open today’s financial institution for everyone to play with. They aren’t designed for that. As with most sensitive systems, a small group of trusted insiders have the keys to the castle. Protecting the systems from malicious or negligent users, is seen as more critical than bringing an abundance of contributors.

This is where crypto-currencies and the development that surrounds them may provide the most revolutionary opportunities. Financial assets are increasingly digital assets, that is they are represented as data that is stored and managed as 1’s and 0’s in someone’s server. With the introduction of blockchain technologies, those 1’s and 0’s are stored and backup on onto thousands of computers all over the world, and their accuracy is verified by unchanging and unbreakable mathematical proofs, rather than someone’s employees. Crypto-currencies like bitcoin offer our world a robustness that is unparalleled and can not be rivaled by any single institution.

While this sounds great to a lot of people, the consumer use cases still remains questionable as long as that credit card keeps working. Most of our financial instruments have been rolled out to us from the top down. Blockchains and digital currencies are being adopted from the bottom-up. The process will be driven from two directions; the people that are getting in today are doing so long before the truly revolutionary uses have been created, much less being used, and are seeking profit or security against inflation. The other growth will come from consumers and businesses finding simpler more foolproof ways to conduct transactions . As we have already seen, increasing interest in cryptocurrency has resulted in skyrocketing value, and the incentive structure for the developers grows as both the value of the currency rises as well as the power of the network itself. The functionality and wider use will improve exponentially, and the use cases will become compelling enough to hardly warrant debate. Our children will grow up in a world where blockchain technology and cryptocurrencies are the norm.