A study by Bitcoin mining firm Genesis Mining has shown that a startling number of US citizens have no idea about how their financial system works. A whopping 29 percent of respondents said they thought the US dollar is still backed entirely by gold.
The study’s findings highlight just how little is really known by the general public about the nature of modern banking. If education about finance proliferates, the value of Bitcoin as these hardest form of money in history might become apparent to more individuals.
Is Lack of Knowledge About Modern Banking Holding back Bitcoin Adoption?
The study, conducted by Genesis Mining, is titled “Perceptions of Money and Banking in the United States 2019.” It sought to discover just how much the general public knows about the way the Federal Reserve and wider banking system operates. The 1,000 respondents were asked a series of 23 questions about US banking on September 19 this year.
The study, detailed in a press release published earlier today, states that a massive 29 percent of individuals believe that the US dollar is still backed by gold reserves as it was in the early 20th century. This is not the only huge misconception many of those asked held about the US financial system though.
More than half (54 percent) said that they believed that Federal Reserve Banks were owned exclusively by the US government, 26 percent said that they thought that banks held 100 percent of customer funds deposited with them as reserves, and 24 percent said that it was the Fed’s job to secure gold reserves.
As well as how well the respondents understand the system itself, the study asked about their spending habits. It found that more than two-thirds preferred some form of electronic payment (debit or credit cards mostly) over cash payments. However, somewhat conversely, a massive 76 percent said that they were against the idea of the US government replacing paper money with a purely digital currency.
Evidently, knowledge about how central banks in the US and beyond operate is lacking, at least in the US. With scant understanding of how the system really works, it is hardly surprising that many are yet to see the value in Bitcoin.
Bitcoin relies on no potentially misunderstood central entities for its issuance or overall monetary policy. This is the complete opposite of modern banking. Meanwhile, banks like the Federal Reserve are not public resources, as many people think, but private businesses. Rather than their customers’ interests, they are primarily drive by profits. If the public was aware of just how easily modern financial systems can crash or even collapse, perhaps a more decentralised, free system, such as Bitcoin, would become more appealing to the masses a lot quicker.
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