It’s natural to think about the potential growth and profitability of cryptocurrency, but with an internationally accepted currency in place, the practical benefits could be enormous. Depending on how the currency is adopted, a stable, internationally recognized currency could have the power to soothe international tensions—and make the world a more peaceful place.
Let’s take a look at the mechanisms that could make this happen and the limitations currently in the way.
The Path Toward Globalization
It’s worth noting that most countries in the world are on a steady path toward globalization and better international relations. The universal nature of the internet connects people together, allowing them to communicate more easily over vast distances, and special initiatives like the Visa Waiver Program are making it easier for people to internationally travel.
Overall, people everywhere want peace and reasonable international relationships—it’s just a matter of overcoming the obstacles that currently stand in their way.
So what is it, exactly, that makes international relationships difficult?
The Roots of International Relationships
It’s an understatement to say that international relationships are complicated. Most wars can’t be traced back to a single incident, or a single set of underlying circumstances. Instead, they’re the end result of a number of different root causes.
There are a handful of disruptive qualities and environmental factors that make international relationships harder, some of which are easier to tackle than others:
- A specific will to create conflict. Some nations, especially in the past, have an inherent desire to create conflict. They may be aggressive as a way to accumulate power or expand, or may have an intrinsic culture that encourages warmongering and/or battle. Fortunately, there aren’t many countries today that exercise their right to initiate conflicts for their own sake—but this isn’t a factor that cryptocurrency would be able to resolve.
- Opposing or competitive economic interests. More interestingly, conflicts are often spurred by opposing or competitive economic interests. Two countries are interested in controlling the same shared resource, and can’t come to an agreement on how to split it fairly. A country feels slighted by the actions of another, and their population is suffering as a result. A coalition of different countries is struggling to maintain a trade deal that all its constituents feel is appropriate. Accordingly, violent action or political tactics like trade wars can emerge.
- A change in the balance of power. Conflict can also arise when there is a sudden or unexpected shift in power. If a new country rises up with an exceptionally powerful military, or if a once-mighty country falls into turmoil, it could inspire others to take action, either restoring the world to its former balance of power or capitalizing on the new opportunity for quick gain.
And things can be made worse by aggravating factors, like:
- Sociocultural differences. If two countries have radically different cultures and viewpoints, it can make it difficult to find an agreeable resolution between them. This is especially true if one country is a stubborn negotiator while another always tries to find a compromise.
- Major difference in power or status. Big economic or military differences can aggravate international tensions; if a country seems too powerful, other, weaker countries are inspired to close the gap.
- Coercive or unchecked state power. Wars are often started because a single individual or small group of people in a given country have access to too much power. If average people had the power to vote to approve a war, they would almost never approve it. Instead, major conflicts are usually initiated when a country’s power is overly centralized.
So how would cryptocurrency have the power to reduce tension?
How Cryptocurrency Could Reduce Tensions
In this scenario, a cryptocurrency like Bitcoin would have to become internationally recognized—that doesn’t necessarily mean all countries need to accept Bitcoin as their primary currency, but it is going to require more international support than it currently has.
The idea is to get all (or at least most) countries operating with the same currency. This would have a number of positive effects:
- Reduction in currency and economic discrepancies. Currencies associated with different countries are valued differently, resulting in a somewhat volatile currency exchange market. Currency values fluctuate in large part due to consumer confidence; when a country begins to struggle with stability, economic policies, or financial management, their currency declines in perceived value. But with an internationally recognized decentralized currency in place, the currency’s value is not dependent on the decisions or actions of any single body. Accordingly, countries should be able to make exchanges with one another on equal footing—or at least something closer to equal footing.
- International culture. Cryptocurrency could also have the power to settle, or minimize international differences. Currency serves as a kind of language, and with everyone speaking the same financial language, some major differences would be resolved. It would be easier for countries to see each other as peers, rather than competitors, and international differences would seem smaller by comparison.
- Reduction in state power. Remember, one of the biggest advantages of cryptocurrency is that it’s decentralized. It’s not managed or controlled by any single governing body—not even the developers who first created it. Additionally, the blockchain has the power to open up entire new paths to prosperity for the people taking advantage of it. With richer populations, less financial control, and more international economic liberties, individual states would have less power.
The Side Effects of Cryptocurrency Adoption
There are also a few side effects of cryptocurrency adoption
that could have the power to reduce conflicts; instead of cryptocurrency
playing an active role in reducing tensions, these factors would improve
international relationships as a consequence of more widespread adoption.
that could have the power to reduce conflicts; instead of cryptocurrency
playing an active role in reducing tensions, these factors would improve
international relationships as a consequence of more widespread adoption.
For example:
- Access to technology. For cryptocurrency to be used by the majority of the population, in a given country and internationally, people need to have unrestricted and universal access to technology. With better technology in the hands of the world population, states would have less centralized power, since citizens would have better access to information and the ability to coordinate.
- International relations management. For countries to agree on an economic deal involving cryptocurrency, there would have to be a set agreement on how to recognize that currency; this is especially important for resolving standing debts or reevaluating older deals based on national currencies. In any case, the path to international crypto adoption would require better international relationships as a prerequisite—so it makes sense those relationships would be stronger after adoption.
- Dissolution or mitigation of strong powers. Some of the most controlling and powerful governments in the world have staunchly opposed the adoption of cryptocurrency, possibly as a way to maintain their power. China, for example, is known for minimizing cryptocurrency access and activity. For crypto to be adopted, it would require these centralized powers to reduce their stranglehold on the population in one way or another.
Cryptocurrency isn’t a magic remedy that’s going to bring us world peace overnight, but its international recognition and adoption could have a powerful and positive effect to minimize conflicts.
The real question is, how long will it be before the majority of major countries in the world actively agree to legalize, recognize, and prioritize the same cryptocurrency?