Why is decentralization so important? Three reasons that will change your perception

Author: Asira S Compiler: Vernacular Blockchain

Cryptocurrency is attracting widespread attention around the world. El Salvador has made it legal tender, requiring merchants to accept it like cash; at the same time, the Blockchain Summit in the United States has attracted billions of dollars of companies to flock to the Web3 field.

Behind this craze, cryptocurrencies such as Bitcoin and Ethereum mean much more than money itself, and they are redefining how money works.

However, complex terms and overwhelming information confuse many people, as if everyone assumes that you already understand. In fact, many people are still trying to understand the true value and meaning behind cryptocurrency.

 01 So, what is decentralized money?

Imagine if Venmo, PayPal, and your bank disappeared overnight. How would you transfer money?

This is a reality for millions of people around the world.

But the problem isn’t just access to banking services (although that’s a big problem). It’s who controls the money itself.

Right now, when you transfer money, you’re not really transferring it yourself. You’re asking a bank or payment processor to do it for you. They’re the middlemen who charge multiple fees, decide who can or can’t use their systems, and have the power to freeze or block transactions at any time.

Decentralized money eliminates all of that. In simple terms, you can transfer money directly to someone else through a digital wallet without having to go through multiple banks. A blockchain, made up of a global network of computers, verifies and records transactions through cryptography and code.

No company, no country, no CEO can step in to stop it.

Unlike banks, decentralized currencies like Bitcoin, Ethereum, and other cryptocurrencies operate 24/7. No business hours. No waiting for "processing time." Banks don't close on weekends.

It's not just about speed, it's about control.

02 Why Decentralized Currency Matters?

For the first time in history, people can send, store, and control their own money without the approval of a bank or government. If you live in a country with a stable banking system, this may not seem like a big deal. But for millions of people, decentralized currency means survival.

1. No one can freeze or block your funds

States and banks can (and do) freeze accounts when they see fit.

Take Canada in 2022. During the truck driver protests, the state froze the bank accounts of protesters and donors without a court order. Or Nigeria in 2020, when the state closed the bank accounts of activists supporting the #EndSARS movement (a protest against police violence).

In both cases, the state felt it was necessary to do so. But at what cost? When you take away a person’s money, you deprive them of the ability to eat, pay rent, and survive.

With Bitcoin and decentralized currencies, this cannot happen. If your assets are in a self-custodial wallet or traded on a decentralized exchange (DEX), no bank, country or company can freeze, block or confiscate them. Suddenly it’s not just financial freedom, it’s a basic human right. 2. Serving the Unbanked Now think about this: 1.4 billion people worldwide don’t have a bank account. Not because they don’t want to, but because they live in places without financial infrastructure, don’t have the right documentation, or are restricted by the state. Before Bitcoin was adopted as legal tender in El Salvador, over 70% of the population didn’t have a bank account. Now people can send, receive and save money without a bank. For billions of people, decentralized currencies aren’t just an alternative, they’re the only viable option.

And, in addition to basic banking services, decentralized finance (DeFi) is becoming a powerful alternative to traditional financial services.

3. Potential anti-inflation protection

Even if you can use banking services, inflation will erode your savings. Inflation means that your money can buy less and less things over time.

Countries control traditional currencies, and when they print more money, the value of the currency decreases. This is exactly what happened in Venezuela, Zimbabwe, and Lebanon, where inflation destroyed people's savings.

The supply of Bitcoin is fixed at 21 million. No country can print more, and no central bank can change the rules at will. This is why some people call it "digital gold."

In the short term, prices fluctuate quickly. But in the long run, some believe it will become a strong store of value due to its fixed supply.

Bitcoin is not yet a perfect anti-inflation tool. But it is a currency alternative that is not controlled by the state. For many people, that is enough to make them pay attention to it.

03 Decentralized Currency Changes Everything

Bitcoin and decentralized currency mean much more than just finance. For some, they provide a cheaper and faster way to transfer money; for others, they are a potential anti-inflation tool; and for millions of people around the world, they are the only way to access financial services.

Cryptocurrency and the technology behind it are not perfect and do have risks, but it is pushing us to rethink how money works. For the first time in human history, people have access to a financial system that is not controlled by banks or countries.

Whatever our attitude towards it, decentralized currency is already shaping the future.