From the inception of Bitcoin in 2009 by the pseudonymous Satoshi Nakamoto, blockchain technology has promised to set your data (and money) free from centralized authorities and aggregators.

How does this work? In a phrase... decentralized networks.

Centralized Platforms

You see, Facebook has a whole bunch of central servers that they control. The data they collect is proprietary. You might think that feels just about right since they worked hard to develop the social network and took all the risk. I'll agree that there is some merit to that argument.

However, they choose who to show your posts to and what posts you get to see in turn. They can manipulate you because they peer into the history of your patterns on their platform: what you view and click on, how long you view it, when you view, and even where you linger without clicking.

And it's one big black box. You can't see how or why they are making these decisions... and that can lead, at its worst, to societal polarization, hate, and political deadlock.

Blockchain Data Transparency

The data and transactions stored on a blockchain are the opposite. They are transparent for anyone to view, review, and crunch to determine trends. So a social media platform using blockchain data can be held accountable by outside forces for bias they inject into their systems.

It also means that small creators like us can reap the benefits of the content we put into the world in practically unlimited ways. A larger proportion of proceeds from videos, blog posts, books, songs, etc. can end up in the hands of the creators instead of the aggregators.

We could call this the Creator Economy.

Now back to decentralization...

Emancipated Data

I mentioned distributed networks earlier. In blockchain this refers to thousands or even millions of independent nodes or computers running a copy of the blockchain software and ledger, where they work together to form a consensus on what the amended future state of the ledger (data) should be. It creates a new layer of security, where it's nearly impossible to change old records and fudge historical information.

It also means you can't get kicked off the platform, banned, sanctioned, or de-platformed.

I know many digital marketers who lost their ability to run their agencies profitably after Facebook shut down their ad accounts without warning or explanation.

Colleagues of mine who own SaaS companies (software as a service) have had their merchant accounts shut down for “suspicious” activity, which actually meant they had run a successful campaign for a new offer that created a flood of new signups.

Please, Mr. Banker, Can I Have Another?

It’s important to understand that banks are centralized nodes where we store money, but we have very little recourse when they make “black box” decisions that inhibit our moves. Blockchains, especially those that include decentralized finance or DeFi functionality, such as Ethereum, help alleviate this wealth velocity flaw by design.

Of course there are centralized players in blockchain as well. Cryptocurrency exchanges are mostly private companies that make buying, selling, and transferring crypto simpler. But as we see with banks, you choose to give up security and transparency when you trust what these private entities do behind closed doors.

As I write this, the second largest cryptocurrency exchange in the world, FTX, has collapsed for mismanagement and possibly fraud. Thousands of people and businesses which held assets on their exchange have likely lost all the value stored in their coins that are locked up on the bankrupt exchange.

If a handful of people (or just one) control the flow of your money, you might as well be using a bank.

There’s an adage in the blockchain community that so many of us choose to forget for convenience:

Not your keys, not your crypto. 🔐

There’s Gold In Them Thar Hills!

A simple physical world example should help you visualize this.

Let’s say you invest in gold and you keep it in a vault in a bank. 🏦

Then the bank files for bankruptcy. You want your gold, but the bank is locked up and no one will let you inside. You don’t have a key to get in. The bankruptcy proceedings last several years and you can’t get to these assets you own. It’s as if you never had them. By the end of the process, it’s possible that the gold gets sold off to pay off large creditors and you never receive any compensation.

Here’s another scenario which we’ve seen in so called developing countries. Perhaps the government takes over all the banks in your country by force and commandeers all assets in the name of fixing the economy. Again, you are left with no gold and no compensation.

But what if you kept your gold in your basement in a vault? It would be much harder for someone to take it from under your nose, right?

Well, the blockchain is designed such that cryptocurrencies can be stored like you could store gold, locally on your hard drive or, better yet, on a hardware wallet, also called cold storage. Unless you are trading your crypto wealth daily, the best bet to secure your assets is to keep them close at hand, far away from decentralized banks and exchanges.

Wake Up And Smell the Crypto

There is a cyclical pattern of human behavior playing before us, which is easy to to see if we choose to open our eyes. We fight oppression at great cost, win our freedoms, then squander them for ease and comfort.

When we fall prey to the soporific effect of getting everything we want exactly when we want it, that’s when the predators strike. In fact, they don’t even need to expend energy to strike. We lay down for our afternoon naps inside their open maws. So, unless we choose to take full responsibility for our wellbeing (health, wealth, relationships, and spiritual growth), and unless we grow up from pampered children into actualized adults, we will continue to abdicate our self-sovereign power and continue getting fleeced by megalomaniacal billionaires.