Ethereum (ETH) creator Vitalik Buterin cites four significant reasons why the world needs cryptocurrencies after the collapse of FTX emboldened his skeptics.
In a new interview on the Bankless podcast, Buterin highlights four use cases that illustrate the benefits cryptocurrencies bring to people around the world.
Buterin says that crypto is already a better way to transact when sending donations to various charities and investing in startup ventures.
“I have personally used cryptocurrency as money a huge number of times this year. For me, the use case is basically mid-sized investments and charitable donations. I’m just sending $200,000 to some charity that gives money to poor people or supports healthcare in Africa or something. Just like quickly diverting money to medical organizations based in all kinds of countries.
Investing in startups.
These are all cases where cryptocurrency is actually significantly more efficient than the existing banking system. I don’t think it’s temporary. I think there are structural reasons why cryptocurrency is better at surviving as a frictionless international thing than traditional fiat banking systems do.”
Buterin also says that crypto offers governments around the world a currency that can compete with the US dollar.
“From the point of view of a country’s government, having 10% of your national economy all of a sudden in cryptocurrency is a lot less scary than having 10% of your economy all of a sudden in US dollars. Because in the second case. the US government has power over you. In the first case it is not. So there is definitely this structural aspect where because of its neutrality cryptocurrency has an advantage that fiat currencies cannot have.”
Finally, Buterin says cryptocurrency is an important currency for people living in developing countries, for example for cross-border payments without paying high remittance fees.
“You go to various places in Latin America, Africa, the Middle East, Southeast Asia and places like that, the financial system there is often not well connected to the financial systems of rich countries.
Often, cryptocurrency is by far the easiest way to send money home to one’s families. Cryptocurrency can even be the easiest way to pay. It might be the easiest way to save money that is much more guaranteed not to drop by a factor of two every year almost forever.”
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