One of my favorite topics to think about, write about and talk about is democratization. When I say democratization I refer to the transition from centralized power to individual freedom, empowerment and sovereignty which can be tied to any categories of societal development.
We can assume that this slow and steady transition from the old dictatorships of the past to a more democratized world started to take place in the 1700s during what has been called the “Age of Enlightenment”. This was the political and ideological movement that started to play with the idea of giving more power to the people and including them in political decisions that affected them instead of leaving that all up to an overarching ruler, which was usually to the despair of the majority. Some people started to question and this was also connected to the industrial revolution happening at the same time where technology started to disrupt old regimes and invited the humans to explore new ways of going about life.
If you are aware of the cycles of the Yugas described in The Holy Science by Sri Yukteswar, some also connect these increase in technology and heightened reasoning as the end of the dark, barbaric and unconscious era of Kali Yuga and the mere start of Dwapara Yuga characterised by a more conscious humanity with stronger awareness.
Maybe this was just the mere beginning of democracy, but the ideas have been on the rise ever since. Maybe it hasn’t been so visible within each generation, but looking back to the 1600s we know things have changed. Technology has given more power to the people and the simple evidence of this is that you are allowed to read my words here without any of us being punished or prosecuted for the use of free speech.
Humanity has seen throughout history how leaving all the ruling power and decision making to one or a few individuals on behalf of everyone is usually leading to abuse and suppression of individual freedom and this is why I personally see democratisation as a positive step in our evolution, almost without exception. Today many people have less trust in centralised power and we want freedom and personal empowerment, especially when it comes to the subject that ties us up the most in our lives: money and our finances.
In the world of the internet, everything seems to become available for everyone. We have better access to information and innovative solutions than presidents had 40 years ago. It can feel like every problem one has, someone has a solution for on the internet.
Better access to everything also makes finance no longer a privilege of the elite. Let’s look at three powerful fintech trends supporting democratisation of the financial system. They can be said to lead the way in moving the financial system out of the hands of the few and into the hands of the masses.
The democracy part is stated in the word itself, “crowd”. What if anyone could support anyone? Be it business ideas, real estate investment, charity, music, someone’s book launch or something completely else, crowdfunding allows individuals and companies to find resources to follow through with their projects. Popular and well known platforms are Kickstarter, Indiegogo, GoFundme and SeedInvest, all suited for different purposes.
Crowdfunding usually means easier access to capital for creative minds and problem solvers. There are different types of benefits for the investors depending on what type of crowdfunding it is. I will go deeper into this in another blog post. Even though it can take some time to build an audience to fund your project, you can more or less find money for anything through crowdfunding. A friend I made in Costa Rica funded her new retreat property through crowdfunding. There are few to no limits!
Online investment platforms
Online investment platforms are making the traditional markets of stocks, bonds and commodities available to everyday people online. You can start out with just a small amount and they take generally low transaction fees which makes it easy to start out. Additionally to the internet making investing way cheaper it is also way more convenient and financial information has become way more accessible.
Online investment platforms are etoro, Robinhood, Fidelity Investments and TD Ameritrade just to mention a few. Each differentiating and specialising in their own way and an example being Etoro introducing the concept of social trading.
Lastly, but not least, cryptocurrency is a powerful technology driving the world of finance into the hands of the common. Yep, I couldn’t write about the democratisation of the financial system without mentioning this one. In fact, cryptocurrencies as decentralised money have become almost a symbol of this trend itself; away from centralised power and over to decentralised technology, by the sue of blockchain technology.
One of the cool features of cryptocurrencies is that they do not inflate over time, making them amazing assets to store value, even thought the fluctuations can be significantly strong. Another important feature of cryptocurrency is the uncheatable technology making it secure and allows them to exist outside of regulatory authorities and governments. Popular online crypto marketplaces are Coinbase, Crypto.com, Bizq, Kraken, Bitmart.