Lessons From an Argentinian DAO Member on How Blockchains Enable Financial Inclusivity
If you had to choose between a bank account and a crypto wallet, what would you choose? What if you had to choose between a bank account and nothing?
“In Spain, once you have lived illegally for 3 years, you can apply for [resident] status. But in the meantime, you can’t apply for a bank account. (translated from Spanish).”
These are the words of Mateo (name changed), a 29-year-old Argentinian cook living illegally in Spain. He told me about the financial struggles he has faced during an interview.
“Argentina is an incredibly unstable economy. Because of the instability, there were never good opportunities to work. Because of inflation, it didn’t make sense to have a bank account.”
Imagine it: 29 years without a bank account. 29 years without access to financial tools most people take for granted: secured savings, investments, and credit. 29 years without the means to change your future.
The blockchain changed all of that. One day, Mateo’s friend sent him 1 ETH and showed him how to trade futures. In a few minutes he made more money than a full day’s wage as a cook.
“I didn’t need a bank account to have a Binance account. This was a huge eye-opener. Suddenly, I could invest my money. I started to understand the possibilities — that [blockchain] could change the fate of people like me in Argentina.”
Mateo isn’t unique. In fact, a McKinsey study found that 50–70% of the adult population of Latin America are living unbanked. For these people, blockchain could be a lifeline. A way to change their situation.
Blockchain Is an Equalizer
Diversity & Inclusion (D&I) is a hot topic in traditional industry. Driven by movements like #metoo and Black Lives Matter, the D&I movement has reached a crescendo. The underrepresented want to see themselves reflected in society, and society is listening. And yet, even as my LinkedIn feed is flooded with placards of D&I efforts, a massive inclusion opportunity is being built on a parallel track. I am speaking of the blockchain metaverse: the decentralized universe of cryptocurrencies, tokens, and passionate contributors.
Granted, today’s metaverse is populated mainly by the privileged. Using their first-world wealth, they build the ecosystem, gaining more wealth in the process. At first glance it hardly seems the place for a revolution of inclusion, but I urge you to take a second look.
Unbound by traditional power structures, the metaverse could be humanity’s greatest equalizer.
For those like Mateo, it’s a pathway to a global financial system previously unavailable; a way to build wealth, knowledge, and confidence.
As a distributed public ledger, the blockchain as a technology has some defining characteristics: it is decentralized and transparent. These characteristics pervade the community — the culture of the metaverse is shaped by the technology that enables it. However, these characteristics are also double-edged swords; they can be used to isolate as easily as to bridge. The metaverse has found a tentative equilibrium which could lead to a more inclusive world, if we’re lucky.
Decentralization for Freedom
Arguably the most revolutionary aspect of blockchain is decentralization. Blockchain networks are built on thousands of nodes run by individuals around the world. This ethos pervades the metaverse — you’d be hard-pressed to find anyone working in blockchain who doesn’t passionately believe in the value of decentralization.
From Mateo’s perspective, a strongly centralized system hasn’t helped his situation.
“It’s frustrating. Argentina is a large and resource-rich country. Theoretically it could be a place that provides everything its citizens need. But [due to politics], it doesn’t. Everyone is living in a constant state of emergency.”
Decentralization means that no matter how much control is amassed by a single entity, there is ALWAYS another way forward for individuals. Worried that Bitcoin is bad for the environment? Create an eco-friendly blockchain that uses proof-of-stake. Ethereum gas fees got you down? You can choose another smart chain or sidechain. Is your fiat currency losing value due to inflation? Convert it to a cryptocurrency.
“When [Argentinians] receive their pay in pesos, the first thing they do is exchange for USD to guard against inflation (51% annually). But the Argentine government only allows a change of up to $200 USD/month. Most people resort to illegal vendors of USD, which is dangerous and expensive. Now, it’s possible to put your pesos into Bitcoin ATMs to save the value.”
For all the freedom decentralization brings, it can also create isolation. It’s true that the value in blockchain is realized when distributed nodes work together, but it’s equally true that any individual node is redundant and can be dropped with little-to-no impact on the group. This state of affairs could make the metaverse a cold and unforgiving place; a place where your value is measured by your economic output and nothing more. And yet, one can see the opposite in the metaverse, where the rallying cry is “WAGMI” (We’re All Gonna Make It). How does that work? It’s the community.
Community for Connection
“Argentines love their asados (barbecues). If people like us want to do an asado, we have to use credit cards to finance the meat over 12–24 months. It’s a price we are willing to pay for our family and friends.”
One thing Argentina shares with the metaverse is the love of community. Whether starting a decentralized autonomous organization or starting an asado, it’s the community that makes it possible and worth doing. The metaverse thrives by bringing together passionate contributors.
If token liquidity is the oil that keeps the engine running, communities are the gears that drive it forward.
It is in everyone’s interest to grow the metaverse community. More people means more demand and more effort. More demand means more exchange, and more effort means more value creation. This is why there’s a large and open body of knowledge to learn how to use the blockchain.
Strong, inclusive communities are a natural counterpoint to isolation in a decentralized, permissionless metaverse.The embrace of self-sovereignty and anonymity are also keys to diversity and inclusion. The fact that anyone can choose whether or not to contribute means anyone who contributes is welcome. A rising tide lifts all ships. WAGMI, indeed.
Transparency for Trust
The blockchain is nothing more than a public ledger. Each block is built of transaction records that are verified and stored by decentralized nodes, available for anyone to view. Smart contracts live on these blocks, and are therefore also open to all. The code that runs these nodes and tools are open source by default. This is known as a trustless system — a system that doesn’t require human intervention to deliver on agreements. When one invests their money, they can have confidence in the contract which holds their capital.
On the other hand, you have Mateo’s experience with “traditional” investments:
“There’s a huge distrust in Argentina on the topic of investing because there are SO many scams. When I first heard about crypto and blockchain, I immediately didn’t believe in it. Anything that sounds good could be a scam.”
Transparency gives individuals the ability to do their own research and make their own decisions. In a world where companies like WeWork inflate stock price through backroom dealings, and companies like Theranos are a straight-up lie, blockchain provides a mechanism for individuals to engage transparently like never before. Revenue and expenses happen on-chain, which means all cash flows are auditable. Some decentralized autonomous organizations use on-chain voting to bring governance into the hands of all stakeholders, and allow potential investors to do their due diligence quickly, easily, and independently.
There are two sides to everything, and the dark side of transparency can be subtle: bias and groupthink. When everyone knows how you’ve voted, what you’ve bought, and what’s in your wallet, it’s natural (perhaps unavoidable) that others will judge. If someone is wealthy, does it make them seem smarter? If they aren’t, are they still worth your attention? Transparency makes this kind of bias all the more prevalent.
Groupthink is even more insidious. When you can see how everyone votes and acts, there can be intense pressure to fit in, and social or professional cost to dissent. How does your voting record reflect on you as a person? Would you think twice when voting if someone would be judging it later? This is a vicious cycle: our actions are judged by others, which leads us to moderate our actions, which are again judged by others. Groupthink leads to a loss of creativity, blindness to negative outcomes, and unquestioning obedience to authority. It effectively eliminates the benefits of diversity, including creativity and resilience. How can we ensure that transparency does not lead to myopic, conformist cliques?
Anonymity for Independence
Anonymity — and its more common cousin pseudonymity — almost seems at odds with transparency, but count on the metaverse to make the juxtaposition work. Colourful names like frogmonkee and scupytrooples carry the banner for Web3, and the quirkiness serves a purpose beyond masking a person’s legal name.
Pseudonyms allow someone to bring their best self to any situation, and to contribute on their own terms without the baggage of their past choices or their circumstance. This is a powerful anti-bias device. Only in the metaverse can you hop into a conversation and be judged for your contribution today, instead of your appearance or experience or holdings or votes in the past.
Anonymity also helps combat groupthink. In open polls, there’s low cost to going with the flow, and high cost to dissent. Running fully anonymous polls lowers the cost of dissent, allowing for greater scrutiny, critical thinking, and better outcomes.
By pairing transparency with anonymity, you can keep the trust while ditching the bias. It’s almost as if the pair forces us to live in the moment, appreciating what individuals bring to the table right now. The metaverse is an unexpected and welcome place to find such zen.
Inclusion for Growth
In the startup space, inclusion is run as a program, parallel to business and mission outcomes. It’s a nice-to-have, and a distant second to survival. In the metaverse, inclusion IS survival.
As positive as the community can be, there’s no denying that the metaverse is a rapidly evolving and risky space. Building value is the name of the game, and aligning incentives is second nature. Code is open source and resources flow freely from one organization to the next. It’s not enough for an organization to be, they must be the best at something. Projects must attract investment and contributors not only today, but continually, even while the landscape around them changes. That’s why every single contributor is valuable, and promoting passion is simply good business.
For Mateo, the difference is hope.
“I’m super excited about the possibilities of Bankless. Being a part of it and learning from people. The biggest difference is a feeling of what’s possible. The ability to collaborate and be involved in something. I still have this day-to-day reality of having to work illegally for money. But I see a way to change my life, which I never had before.”
In the metaverse, Mateo is the rule, not the exception. He’s a valued member of BanklessDAO, one of the largest DAOs with the most zealous contributors. In a world where leaving people behind is business as usual, traditional industry would do well to learn the metaverse’s lessons on inclusion, lest they get left behind themselves.
links is a web2 product leader and startup artist seeking inspiration in web3.
BanklessDAO is an education and media engine dedicated to helping individuals achieve financial independence.