Author: Asira S
Compiled by: Vernacular Blockchain
Cryptocurrency is gaining traction around the world. El Salvador has made it legal tender, requiring merchants to accept it like cash, while blockchain summits in the U.S. are attracting multi-billion-dollar companies to the Web3 space.
Behind this craze, cryptocurrencies such as Bitcoin and Ethereum mean far more than money itself. They are redefining the way currency works.
However, many people are confused by the complex terminology and overwhelming information, as if everyone assumes you already understand it. In fact, many people are still struggling to understand the true value and meaning behind cryptocurrency.
So, what is decentralized currency?
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.
Now, when you transfer money, you're not actually transferring it yourself. You're asking a bank or payment processor to do it for you. They're the middlemen, they charge multiple fees, they decide who can and can't use their systems, and they have the power to freeze or block transactions at any time.
Decentralized currencies eliminate all of this. In simple terms, you can transfer money directly to others through a digital wallet without going 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 and stop it.
Unlike banks, decentralized currencies like Bitcoin, Ethereum, and other cryptocurrencies operate 24/7. There are no business hours. There is no waiting for “processing time.” Banks are not closed on weekends.
It's not just a question of speed, it's a question of control.
Why is decentralized currency important?
For the first time in history, people can send, store, and control their own money without the need for bank or government approval. 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 money 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 drivers’ 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 deemed it necessary to do so. But at what cost? When you take a person's money, you take away their ability to eat, pay rent, and survive.
With Bitcoin and decentralized currencies, this can’t 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, this isn’t 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 documents, or are restricted by their country.
In El Salvador, before Bitcoin was adopted as legal tender, more than 70% of the population did not have a bank account. Now, people can send, receive, and save money without a bank.
For billions of people, decentralized currencies are not just an alternative, they are the only viable option.
Moreover, beyond basic banking services, decentralized finance (DeFi) is emerging as a powerful alternative to traditional financial services.
3. Potential protection against inflation
Even if you have access to banking services, inflation can eat into your savings. Inflation means your money can buy less and less over time.
States control traditional currencies, and when they print more money, the value of the currency goes down. 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. That's why some people call it "digital gold."
In the short term, prices can fluctuate quickly. But in the long term, some believe it will become a strong store of value due to its fixed supply.
Bitcoin is not yet a perfect hedge against inflation. 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.
Decentralized Currency Changes Everything
Bitcoin and decentralized currencies are not only about money but also about finance. For some, they provide a cheaper and faster way to transfer money; for others, they are a potential hedge against inflation; 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.
Regardless of our attitude towards it, decentralized currencies are already shaping the future.
