Economic activity is linked to the flow of money in the system. The more money flows, the more a society is considered productive. People use money to pay for goods and services, and the same dollar can be used to pay for many transactions in a given year. Monetary velocity is used to determine the quantity of dollars in circulation.
What would happen if people decided to hodl their currency and stored their fiat money in their bank account or under their mattress? That would mean there is less money going around. This would not be in society’s best interest, surely there would be less projects, ventures, opportunities, companies being created for lack of access to money.
Taking this concept to cryptocurrencies, a user had two main choices: to hold onto their BTC, ETH, etc. in their wallet, effectively idle, or they can flow, i.e. redeploy their funds towards productive uses, and get rewarded for making their money benefit others. Note that in both cases, to hodl or to flow, the user retains ownership of their coins.
There are many productive uses for coins, such as staking, lending/borrowing, buying up NFTs or tokens, and so. The Web3 economy, with the promise of disrupting banks in a permission-less fashion, is going to reach its full potential by increasing the money velocity. By exchanging and use the same coins for others to meet their goals.
Collectively, this will be potentially a lot more impactful and useful than keeping coins idle. Even if there are risks involved, I think that it is worth voting with your own funds and pushing for the future we want to see become reality.
The more we flow, the faster the crypto economy can reach mainstream adoption, and their full potential as a result.
Let is flow. This will create abundance for other users.