Monetary vs. Financial Sovereignty: Why it Matters for Bitcoin's Future

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January 14, 2021

There’s one thing you have to admit about Bitcoin - it has an exquisite sense of timing. Unleashed directly following the financial disaster in 2007-2009, Bitcoin quietly began its gentle intrusion into the hearts and minds of all those who value financial freedom over centralized economic control that all but invites corruption. Now in 2020, Satoshi’s vision of censorship-resistant, bankless money has again wound its way into the mainstream imagination.

Only this time, there’s a level of infrastructure available to move Bitcoin past the monetary sovereignty it already provides, and into a new world of decentralized finance (DeFi).

Yes, Bitcoin does enable secure, peer-to-peer payments between any two parties in the world without a 3rd party bank, payment company, or government agency. Bitcoin allows us to be sovereign when it comes to money, which is a beautiful thing.

What if you have to USE your Bitcoin?

How many people take their money and just put it aside and do nothing with it? Having Bitcoin and using Bitcoin are two completely different things.

The first generation of financial platforms that were created around Bitcoin have come to rely on centralized entities in order to “do things” with Bitcoin. If users of these self proclaiming decentralized platforms want to lend their Bitcoin to earn dividends, trade it, or exchange it for fiat currency, they give up the financial privacy and security provided by the Bitcoin Network. Their monetary sovereignty becomes victim to KYC verification and from then on, their financial activity and personal data is stored on each of these different applications and exchanges.

A centralized financial system requires people to give up their financial privacy and freedom, and also puts them at higher risk for data breaches and hacks. How can Bitcoin still be sovereign money when each time you use it, you’re risking your coin and financial data to multiple points of centralization?

The internet is becoming more centralized, and so is Bitcoin

Just like the “open public” internet has become centralized over time, so has our beloved Bitcoin whenever it touches first generation DeFi. The avid interest in decentralized finance platforms has revealed that people want to transact trustlessly, privately, and securely. But they are not getting the whole bargain when KYC comes into the picture.

Censorship is here

This year, we’ve seen how an individual can “disappear” from the internet in a day. We all recently witnessed the complete deplatforming of a sitting US president. No matter your political flavor, the swift and absolute social removal of the POTUS should trigger alarm bells for those that value freedom of speech - especially to members of the crypto industry who have faced their own shadow bans and deplatforming for vague reasons. It’s clear that the mechanisms for shutting down someone’s presence, business, and voice are in place - they’ve already been utilized to their full extent and likely they will be used again.

You can say the same for your centralized, fiat-based money. The mechanisms for retrieving or freezing your assets in a heartbeat are in place, should they ever be needed for a just (or unjust) cause. These tactics have definitely been used in the past, and they will likely be used again in the future.

Bitcoin, as sovereign money for the people, must transcend centralization at all points of contact to become the basis of a sovereign financial system.

The new face of DeFi

A technical infrastructure that enables a Bitcoin-native economy has been in the making for years and is now taking root. Bitcoin holders who want to elevate the monetary sovereignty of their Bitcoin into full financial sovereignty now have a path. Sovryn leads the way with its second generation DeFi protocol. Here’s how it works:

Sovryn is building an open economy that is:

  • Global
  • Censorship resistant
  • Permissionless
  • Secure

Just like Bitcoin.

By using the RSK sidechain of Bitcoin that is also merge mined by Bitcoin miners, Sovryn ensures that the financial operating system they are developing is backed

and strengthened by the Bitcoin Network, the world’s largest and most secure computer network.

The Sovryn protocol enables a Bitcoin-native system where pseudonymous users may trade, lend, borrow, earn and leverage Bitcoin and other bridged assets. Every transaction is verified with Bitcoin’s Proof of Work (PoW) consensus mechanism. With sidechain capabilities and zero knowledge (ZK) roll up technology, pseudonymous Bitcoin-native transactions can scale securely, all while providing a layer of interoperability with other blockchains like Etheruem.

The best part about building a system backed by the strength of the Bitcoin Network, is the fact that everything that Sovryn accomplishes adds even more strength to the network.

  • Imagine lending and earning Bitcoin 100% trustlessly while never losing control of your private keys.
  • Imagine leveraging your Bitcoin assets and earning more Bitcoin while maintaining full financial sovereignty.
  • Imagine trading Bitcoin on an exchange that is committed to the same level of decentralization as Bitcoin.

If you can imagine all that, you get a glimpse of Sovryn’s vision of a tightly integrated financial operating system living on the Bitcoin Blockchain.

Learn more about Sovryn in the Library of DYOR and be sure to sign up on to hear the latest news about Sovryn’s upcoming SOV token event.

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