Fairness, Behavioral Economics and Cryptocurrencies

Cryptocurrencies and Behavioral Economics

Is it “fair” that a technology entrepreneur who lives in a capitalist economy may literally print money out of thin air?

If so, how much money could be printed before it becomes “unfair”?

What if one person could print money that creates around $60 billion dollars of personal wealth in only 5 years?

What if the 9 or 10 richest people in the world had as much combined wealth as the ALL THE COMBINED WEALTH of 4 billion poorest people?

What if the laws and rules we live by also didn’t seem to apply to them?

Would these inequities have psychological and social ramifications? The study of behavioral economics gives us clues…

And maybe predictions for the future?

What is Behavioral Economics?

Behavioral economics is the study of human emotional, psychological and cognitive  behavior involving money.

Traditional economists believe humans are rational actors… Seeking maximum utility…

Behavioral economists, however, reveal that we are predictably irrational.

We’re more “homo praevisam irrationalis” than “homo economicus“…

And when presented with conditions that are clearly unfair, we sometimes act irrationally, even to our own detriment.

Why would we ever act against our own self-interest?

To experience the satisfaction of getting even.

Are Cryptocurrency Riches “Fair”?

Is it fair that Chris Larsen, the co-founder of Ripple, has generated a net worth of $60 billion in only 5 years, literally by printing his own money out of thin air?

After all, Mark Zuckerberg must be jealous because it took him almost three times as long.

Then again, Facebook will probably create its own cryptocurrency soon enough.

Amazon surely will.

Then Bezos’ are the new Mansa Musa I…And Zuckerbergs are the new Rockefellers and the Larsens are the new Rothschilds.

Social unrest may result… But we’ll be on the wrong side of the law.

First coins, then fiat currencies, then stocks… Cryptocurrencies and crypto-assets are merely the next evolution in finance.

With untold riches to be created for the makers of the money.

After all, the founding father of international finance, Mayer Amchel Rothschild is often associated with the quote:

“Give me control of a nation’s money supply, and I care not who makes its laws.”