Only a small fraction of the global population is investing in the financial markets and assets that help build and preserve personal wealth. The latest infographic done in partnership with Visual Capitalist looks at traditional investing trends at a global scale, and how the emergence of decentralized finance can help create more financial access, opportunity, and equality.
This infographic is the third in a series of data-driven stories done in partnership with Visual Capitalist. The first graphic in the series examined the flaws of the current financial system, while the second graphic looked at the potential of decentralized finance to address some of those flaws.
A simple case for global financial inclusion
Investing in financial markets is a basic tool to build personal wealth. Here are a couple of basic reasons:
Hedge: Equities markets can be used as a hedge against the inflation of fiat currencies.
Compounding: Cash doesn’t compound, and actually loses value over time.
Protect wealth: Diversifying across asset classes helps protect wealth during tough times.
Current barriers to entry for most of the world’s new investors interested in equity markets and other valuable financial assets include geographic location (there is a correlation between where in the world people are located and the ability to access financial markets), financial literacy/complexity, unstable local markets, and the cost of investing through traditional means.
Some of those problems can be addressed by better financial technology, like Bitcoin.
How decentralized investing creates more financial access
One of the main attributes of decentralized tools Bitcoin and other cryptocurrency protocols is that they can be used as programmable money. These attributes remove some of the barriers to entry mentioned above (like geographic limitations and the cost of making investments).
Abra is using the programmable features of cryptocurrencies to build a global investment app that will help democratize access to financial services, like investing.
Like Bitcoin itself, crypto-collateralized investments into things like traditional equities can happen via fractional or micro-investing, which opens the possibility of investing in some of the world’s most valuable assets to more people.
Check out the full story from Visual Capitalist: