Establishing New World Finance: Broader Impact Of Bitcoin On Global Economy

Bitcoin’s move to prominence has essentially been the amalgamation of numerous external and internal factors.

Arguably the most significant of Bitcoin’s impact on the world, Blockchain technology received a massive boost following Bitcoin’s public release in 2009.

Source : David Peterson/Pexels

By Roshan Aslam

The emergence of Bitcoin was closely followed by the global economic crisis in 2008. As conventional currencies underperformed and came under significant stress, the global economy became subject to massive losses. However, while the first public appearance of Bitcoin was not considered a significant motivator for the global economy, the narrative gradually shifted in the next decade, making Bitcoin the face of the new world of finance that we know now. 

Bitcoin’s move to prominence has essentially been the amalgamation of numerous external and internal factors. To begin with, Bitcoin’s emergence led to significant innovations in blockchain technology, an aspect that has transformed finance as we perceived before 2009, leading to significant technological development. 

As BTC secures its position as the world’s most significant risk asset and as one of the best hedges against inflation, its role in introducing concepts like decentralisation, transaction speed, transparency and digital payments has been revolutionary. These aspects have been significant drivers of adoption by retail traders, whales and institutional investors — all aspects that have impacted the global economy. It has led the global governments to finally make their move into the domain, and subsequent considerate economic policies have been created. 

However, it must be understood that while it has been more than a decade since Bitcoin came into circulation, it has yet to reach the pinnacle of its potential. Its future role in economic impact remains a topic of discussion among global economists, however, its role so far has been evident in shifting perspectives and narratives in the global economy till now.

Blockchain & Decentralisation

Arguably the most significant of Bitcoin’s impact on the world, Blockchain technology received a massive boost following Bitcoin’s public release in 2009. As the foundation behind Bitcoin, significant research & development in Blockchain led to unprecedented innovations in global finance, introducing new concepts like decentralisation. 

While it was perceived as unviable at the time, Blockchain’s decentralised nature has since made considerable inroads, transforming global finance as we know it. For instance, Bitcoin’s market capitalisation stands at over $1.90 trillion, an aspect that uniquely positions it as a new tool that addresses value creation for stakeholders across levels — retail traders, Whales, institutional investors and governments. 

This notion has been supported by the recently inaugurated US President Donald Trump, who has vowed to make the US the Bitcoin capital of the world and create Bitcoin reserves similar to dollar and energy reserves that can be used as legal tenders for transactions. 

The emergence of decentralisation through Blockchain has transformed cross-border transactions with speed, affordability and transparency, marking a milestone for establishing new world finance for the years to come.

Economic Impact

The emergence of Bitcoin has led to the creation of a completely new global industry through Blockchain and the subsequent release of other tokens. This has diversified conventional finance, leading to the generation of new employment opportunities. With an industry that had a valuation of $2.7 trillion in 2024, the sector is expected to be valued at $6.2 trillion by 2033, and the impact on generating new job roles has been massive. 

This has directly impacted the global economy, helping individuals with several new avenues for value creation. Recent reports also suggest that Bitcoin and Blockchain-related jobs pay over 150 per cent in contrast to other jobs, indicating the demand and growth prospects for global economies. 

Furthermore, Bitcoin-related income has been taxed significantly throughout the world, an aspect that has been directly contributing towards both national and global economies. 

For instance, the Government of India levies a 30 per cent tax on gains and 1 per cent TDS on Bitcoin transactions. Similarly, the United Kingdom taxes Bitcoin-related gains between 10 per cent-20 per cent depending on factors, the US has a policy of taxing Bitcoin at 10 per cent-37 per cent for the short term and 0 per cent to 20 per cent for the long term. While high tax slabs are often considered an obstacle to Bitcoin adoption, their role in supporting the economy cannot also be undermined. 

Coupled with this, Bitcoin and the subsequent emergence of Blockchain technology have automated and digitised financial transactions that can be monitored through a ledger which cannot be manipulated by anyone. 

Also, Decentralised Finance (DeFi) offers more speed for transactions in a more cost-saving approach, also reducing the chance of fraud. This offers to bring the globally unbanked population under a single umbrella, enhancing the accessibility of financial services irrespective of location and geography. These practical approaches enhance the functionalities of the new-age finance led by Bitcoin, boosting the growth of the global economy.

Supporting Legal Tenders

Inflation is a key concern in finance, and numerous countries are suffering from their unstable or inflated legal tenders. Furthermore, the global dependence on the US Dollar for trade, its predetermined regulations and US sanctions on numerous countries mean that confidence in the US banking system has reduced significantly in the past few decades. 

For these countries, Bitcoin offers a new avenue, while hedging against inflation and supporting the national economies with value creation. Bitcoin’s usage has witnessed a considerable increase in nations like Venezuela and Lebanon, where the legal tender has been facing hyperinflation, and using Bitcoin as an alternative for financial transactions has extended a lifeline. 

Bitcoin’s overall economic impact has been massive globally, and as it evolves, economic policies surrounding the growth of Bitcoin are expected to be introduced around the world. However, the true extent of its impact on the global economy is still to be witnessed, but establishing a new world economy should be the bare minimum that can be expected in the years to come. 

(The author is the Co-Founder & CEO of GoSats)

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