A Week Of #GoodNews

Can DeFi do better than traditional financial institutions?

Is decentralised finance (DeFi) better equipped for 2021 compared with traditional financial institutions? At GoodDollar our reply is “yes”, however it may be too soon to answer this question, posed by BTC Peers and posted on yahoo!finance at the end of 2020. Whatever, it is an increasingly important topic, and DeFi is on the rise. If 2020 taught us anything it was that it is high time we updated our antiquated systems, which are not fit for purpose in the digital age. As the article states: “Several negative aspects of traditional finance still exist today. First, there is a lack of inclusivity. Banks and other providers manually determine who will be given access to financial products and services. To become eligible, users need to part with their personal information, eroding any sense of privacy along the way. It is far from an ideal situation, as 1.7 billion adults can’t access modern financial products and services.” It is in this space that DeFi can thrive, and it is for this reason why it is the (near) future, and why GoodDollar – which aims to build a decentralised, blockchain-backed basic income solution and greater financial inclusion – is excited about its development.

To bank the unbanked education and access to digital platforms is critical

Yaya Fanusie, an Adjunct Senior Fellow at the Center for a New American Security (CNAS), argues on Forbes that we should “stop saying you want to bank the unbanked”. He writes: “Unchecked assumptions about financial inclusion are causing some government and business leaders to pursue strategies that are likely to give poorer people access to new technology without helping them generate [the] income needed to improve their financial situation.” At GoodDollar we think this is a totally valid point, but what’s missing here is that market education is critical. There’s a digital revolution happening, and the aim for mass financial inclusion is essential to make sure the global inequality divide doesn’t worsen.

How the coronavirus pandemic shoved us into the future

As this Bloomberg piece argues, convincingly, “disease shapes human destiny” and last year’s coronavirus pandemic, which is still impacting every aspect of our lives, has accelerated progress on a number of fronts. Loren Padelford, Vice President at Shopify, is quoted in the article. “COVID-19 has acted like a time machine,” she says. “It brought 2030 to 2020.” Certainly GoodDollar’s progress has been sped up by the events of last year, with more people realising that some sort of basic income is necessary across the globe. “In science and technology, not to mention the way we work and play, we’ve just entered a new age of discovery,” the piece suggests. To us it is clear: the future is digital and a new social contract is emerging. So let’s buckle up!

Are pandemic relief checks making UBI inevitable in America?

This is a puzzler posed by Bonnie Kristian, a US-based contributing editor of The Week. “I expect to see a new – and perhaps even bipartisan – move toward universal basic income (UBI) or something like it, an evolution influenced by Americans’ experience with pandemic relief checks, both the fact of them and the drawn-out political fights surrounding their passage.” We agree at GoodDollar, and wrote about this topic nine months ago (and how technology can enable UBI), when the pandemic hit and it was clear one-off parachute payments would not be sufficient. The idea of UBI will take time to marinate, but the argument for its implementation is shifting from “legitimate” to “necessary”.

How crypto and blockchain made inroads into financial services in 2020

Finally this week, American Banker runs the rule over the development of cryptocurrencies and blockchain technology in the last year – and it’s obvious that, as the piece states, they “are slowly but steadily becoming more embedded in the financial services industry”. From the Federal Reserve’s interest in creating a digital currency to notable moves by Visa and Mastercard, blockchain is becoming synonymous with the future of banking. What will 2021 bring?

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