This week, Fai and I find ourselves at a finance conference in Bali, Indonesia. It's a stark reminder of how inflation and the devaluation of a currency can disproportionately affect the most vulnerable communities. These communities are often the farthest from the decision-making centers and offer no financial incentives to those in power. They remain at the bottom of the priority list when it comes to empowerment, education, and support.
As inflation erodes the purchasing power of the middle class worldwide, these impoverished communities face increasing desperation. It's a question that has been on my mind for as long as I can remember: why do we avoid discussing the most critical issue that divides us—the broken state of our monetary system? It's perplexing that the global monetary system's flaws are often ignored, despite their significant impact on our lives.
A quote from the movie "The Big Short" by Brad Pitt comes to mind: "If we're right, people lose homes. People lose jobs. People lose retirement savings, people lose pensions. You know what I hate about banking? It reduces people to numbers. Here's a number - every 1% unemployment goes up, 40,000 people die. Did you know that?" This quote emphasizes the human toll of financial crises and how these events can devastate individuals and families. It reminds us that the statistics discussed in finance have real and profound consequences.
However, what truly inspires me during these conferences, spanning over five different countries, is the emergence of a fair and equitable system that runs parallel to the current one. This system is designed for everyone, with rules rather than rulers. It provides a censorship-resistant, permissionless store of value, a medium of exchange, and a unit of account that can't be manipulated or confiscated by adding more political influence to the currency.
In this new paradigm, incentives are aligned for every participant, strengthening the system and benefiting all who use it. It offers sovereignty and freedom to billions of people who couldn't access traditional banking. You can transact globally in an instant for a fraction of a cent, crossing any currency barrier. Unlike gold, it's divisible, not easily confiscated, and doesn't require a trusted third party for storage. It's everything we hoped gold could be.
I take pride in being part of a community that is addressing the world's most pressing issues. Fixing our broken monetary system is essential because it's the source of funding for wars and the destruction of entire regions, causing untold suffering. For instance, my neighboring country, Laos, has seen its currency, the Lao Kip, lose over 50% of its value in the past 24 months. I vividly recall being stuck there for 8 months during the pandemic and returning to the U.S. with the equivalent of $100 in Lao Kip, now worth only $45.
While finding a solution can be challenging when you're entrenched in the problem, I remain confident that humans will discover a better way. It's a path to prosperity, peace, and love, where everyone thrives. In this vision, our money grows stronger, our savings multiply, and we all experience greater freedoms. Together, we can build a brighter future.
Jimmy Kostro
The Kostro Foundation
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