A quick disclaimer upfront: All information given in this presentation is researched and intended to be educational and illustrative to the specific topic, as always. Any companies, products, people, or other items mentioned do not constitute an endorsement, recommendation, or relationship. Every owner has to do their due diligence, as the decisions and responsibility about any investment lie with the owner. This information is not financial advice.
What is globalization?
Globalization generally refers to networking across borders. It describes the economic, political, and human influence organized on a global level and is defined by their interconnection.
Why is it important?
Globalization has a very important impact making it indispensable for the digital and advanced world of the current time.
Compared to the past, globalization has made the world more accessible to different landscapes and infrastructures. The use, availability, or even the use of products, companies, or entire associations worldwide has evolved into a simpler, cheaper, and more advantageous process.
Since globalization takes place in an area-wide process and differs depending on the process, it is necessary to decide on various subcategories that describe the development of globalization in the individual areas of the world in more detail and better:
Cooperation between countries and political communication between individual parties or entire associations have been raised to a new level by globalization. Partnerships, interactions between countries, and trade agreements have been expanded and shaped on much larger, unprecedented levels.
Communication in our world has evolved from long response times to letters and correspondence to emails, phone calls, and live conferencing across the globe. The ability to communicate with anyone, anywhere in the world, and to structure the interaction shows the possibilities our connected world offers. And with the internet and smartphones, these communication channels are becoming more accurate, faster, and cheaper.
The availability of connections worldwide and the ease of traveling anywhere are a product of globalization. Having products from all over the world within your local supermarket and paying a very low price is possible thanks to mass production and huge logistic transport. Goods once considered rare and available only in other countries are now available as everyday commodities. Just think of the possibility of using spices in cooking, specific vegetables which do not grow in your area, or even technological innovations that are developed far away from us but can be available here in a very short time.
Cultural influence or even the opportunity to experience new countries or study other cultures seems to be nothing special in today's world. Yet the ability to travel globally to any point in the world is amazing. Compared to the past, when people were very restricted to local travel, traveling out of your town could even be considered a luxury.
Technology is arguably the most defining factor of globalization and one of the factors by which most people best recognize the new, connected world. Technology - especially on a global scale - means the ability to make advances and improvements available for everyone around the world. These can be medical advances to fight disease, vehicles to use infrastructure, everyday helpers for daily use, or entertainment media to amuse people. There are no limits to technology because global connectivity means more views, ideas, and opportunities to research and develop them further to provide a global benefit that can be used everywhere and progress to the broad mass of humanity.
The dark sides of globalization
Globalization - as nice as it sounds - also has disadvantages in addition to all the advantages.
On the one hand, there is the pollution of the environment caused by mass production and the permanent provision of goods. The mass shipping, provision, or transport of goods from one point on earth to another is not only good for the environment but also harms it. This is because the CO2 emissions of most trade routes are not optimized and cause more and more air pollution with each transport. This also arises in the production of most goods and the implementation of the production chains because the productions that have grown based on the task of globalization have also become so large that they massively affect the emission of CO2.
A solution to this is the reduction of CO2 emissions by changing the production processes and improving the transport routes and means. Improvements in production and vehicles with reduced emissions are a good approach and are being implemented more and more, but the change process is very slow.
Another problem with automation and the provision of a desired good is the displacement and loss of old crafts. Machines that take over the execution of processes over generations and automate production are causing us to unlearn our knowledge and crafts, which are written down but cannot be easily replicated. An example is umbrella and glove makers, which are no longer learned individually due to globalization.
Another very negative aspect is dependence. If a good is available at an affordable price due to its mass production, another producing it may not be worthwhile as it may not incur sustainable profits, thus creating a monopoly. A dependency is then created, which can lead to problems. The best example of this is a shortage of goods that occurs worldwide during a pandemic, as trade routes are interrupted as a result.
In this case, it is important to have reserves or to create alternative possibilities and, if necessary, to strengthen one's local market.
Globalization for crypto payment methods?
Due to the numerous possibilities for communication and intercontinental trade, globalization also offers opportunities for money transfers to take place worldwide. It is possible to send money quickly from one point to another using conventional payment methods or providers. Fast is a rather historically comparative term because, compared to the past, a money transfer of about 1-2 weeks to the other side of the world is a milestone.
But what can crypto do here?
Cryptocurrencies not only bring about instant trading and the direct, immediate transfer of funds with significantly less time, but they also offer a new technological development through the possibility of unbound, unbureaucratic, and unhindered paths, which will influence not only money trading but also the entire trade worldwide for our time. The possibility of sending money easily via a globally identical trading structure is the first step towards unifying currencies under one banner, the so-called global currency. It does not necessarily have to be that everyone pays in the same currency but that everyone has the opportunity to use the same payment channels. This advantage is driving the world and will usher in a new age of currency and medium of exchange if regulation accepts it, and world adaptation pushes it.
Future development of a globalized world
Despite its negative effects, globalization has improved the world. Connectivity, worldwide availability and direct connection with other people, countries and systems have created unimagined opportunities. The only important thing is to be careful here and to contain or prevent the side effects such as global pollution and monopoly, which is feasible through rules that apply to everyone.
For cryptocurrencies and the newly created possibility of transparent trading after regulation, a level has been created that the world can use to develop further. The fairness, transparency, and availability that cryptocurrencies can offer under the right circumstances is phenomenal and should be further developed. Therefore, the world's systems are also looking to promote this and make it available to everyone with the right rules and regulations.
Only time will tell where this path leads. But we will all experience it, because the worldwide adaptation of such huge payment options will not be left out.