Charles Hoskinson, a name synonymous with crypto innovation, throws a bold prediction: Bitcoin to $250,000, fueled by the "Magnificent 7" diving headfirst into stablecoins. Then, BOOM… legislation passes, Apple, Amazon, Microsoft… they all collectively jump in with both feet, using stablecoins for everything from in-app purchases to international remittances. Sounds utopian, right? Faster transactions, lower costs, widespread accessibility … Slow your roll there, buddy. Are we effectively giving over the keys to the financial kingdom to a few companies?

Who Actually Benefits Here Though?

We're told it's about freedom. Freedom from expensive cash banking fees. Freedom to transact internationally. But whose freedom are we actually debating here? What about the average citizen in a developing country with hyperinflation—shouldn’t his or her freedom come first? Or should we just give Amazon a pass to continue consolidating its dominance in the global marketplace?

Think about it. These tech giants already wield immense power. They dominate our access to information, dictate how we use the internet, and determine what products we buy. Do we really want them holding the keys to our money as well? The "Magnificent 7" entering the stablecoin arena isn't just about streamlining transactions; it's about accumulating more power. This is not freedom for the many, it is freedom of the few.

Consider Facebook's Libra (now Diem) fiasco. The backlash came from much deeper places than regulatory anxiety. It exposed the extreme market power that had been aggregated into one corporation. Are we destined to repeat history?

Let's not be naive. Every technological advancement has unintended consequences. Perhaps first realized with the printing press, the democratization of information brought a wealth of benefits but made dangerous propaganda more accessible. While the internet opened up communication around the world, it allowed for these echo chambers and for the spread of misinformation.

Unintended Consequences Are Looming

1. Regulatory risk: Governments may impose strict regulations that could affect stablecoin usage. 2. Market volatility: Stablecoins can be impacted by fluctuations in the underlying assets. 3. Security risk: Cyberattacks could compromise the security of stablecoin platforms. 4. Adoption risk: Users may be hesitant to adopt stablecoins due to lack of understanding. 5. Competition risk: Other cryptocurrencies or payment methods could outpace stablecoins in popularity.

Now, I’m not suggesting we need to ban stablecoins entirely. There's potential for good here. We must be careful to not move too quickly and focus on ensuring equitable access first.

  • Financial Exclusion 2.0: What about the billions who lack access to smartphones or reliable internet? Will they be left behind in this new financial landscape, further widening the gap between the haves and have-nots? It's a digital divide on steroids.
  • Data Privacy Nightmare: These companies already collect vast amounts of data about our online behavior. Do we really want them tracking every single financial transaction we make? Imagine Amazon knowing exactly what you buy, where you buy it, and how much you spend. They could use that information to target you with even more personalized ads, manipulate your purchasing decisions, or even deny you access to certain products and services based on your spending habits. Creepy, right?
  • Currency Instability: In developing nations with weak currencies, the widespread adoption of a stablecoin pegged to the US dollar could undermine local monetary policy and destabilize the economy. Imagine a situation where everyone in a country starts using "AmazonCoin" instead of the local currency. The central bank loses control, and the country becomes even more dependent on a foreign power.

Equitable Access Is The Only Solution

Hoskinson’s forecast of a bear market lull succeeded by a wave of speculative mania is fascinating. Let’s not get carried away with the hype. Let’s not lose track of the fact that technology is a tool… and like all tools, they can be used for good or for evil. It’s our responsibility to ensure that these new financial tools—stablecoins—benefit the creation of a more just and equitable world. We should not let them double down on making the powerful more powerful. Let’s not replace one layer of paternalism with another. Let’s call for responsible innovation, transparent regulation, and equitable access. The future of finance – and maybe, our freedom – depends on it.

Meanwhile, the total number of crypto owners grew to 659 million individuals. This five-fold increase is indicative of the rising interest in open, independent financial ecosystems. Let's not mistake interest for progress. Real progress will come when everyone can take part in the promise of these new technologies — rather than a few people. Let’s work to make sure the future of stablecoins is one in which they serve individual users, rather than corporations.

  • Regulation that protects consumers and promotes competition. Not regulation that is written by and for the Magnificent 7.
  • Education and outreach programs to ensure that everyone has the digital literacy skills necessary to participate in the new financial landscape.
  • Investment in infrastructure to bridge the digital divide.
  • Open-source alternatives to ensure that no single company controls the future of finance.

Hoskinson's prediction of a market stall followed by a surge of speculative interest is intriguing. But let's not get caught up in the hype. Let's remember that technology is a tool, and tools can be used for good or for evil. It's up to us to ensure that stablecoins are used to create a more just and equitable world, not to further entrench the power of the already powerful. Let's not trade one form of control for another. Let's demand responsible innovation, transparent regulation, and equitable access. Because the future of finance – and perhaps, our freedom – depends on it.

The rise of cryptocurrency owners to 659 million people is a testament to the growing interest in alternative financial systems. But let's not mistake interest for progress. True progress means ensuring that everyone benefits from these new technologies, not just a select few. Let's aim for a future where stablecoins empower individuals, not corporations.