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From the outset, apologies in advance, I do not intend to answer this question fully. It is impossible to do so. What I would like to do is start a conversation. With that noted, I will give my answer to the question. Can crypto end poverty? YES, yes it can. Allow me to elaborate
The first key question is what causes poverty? Much ink has been spilled over this question. There is a rigorous debate in economics as to the answer to this question. I don't like to think in causal terms per se, instead in terms of binding constraints. A binding constraint is relatively simple, what stops something from happening. What is the binding constraint that stops me from falling through the floor into my neighbor's apartment? Well, the floor. The thing with poverty is there might be many. The simple rule is the poorer the country, the more binding constraints there are. Usually, in a rich country, the constraint is lack of education, or perhaps addiction, or mental illness — no small feat to overcome. But go to a developing country. There may be a much longer list. Then the question becomes, ok, which is the most binding constrain? Can I remove one, and the rest will follow?
For example, many have traveled to impoverished countries and notices a lack of education. However, can we remove this and remove poverty? The answer is no. In a rich country, the answer may be yes. The reason this is true is that even with education, there may be no opportunities. The education constraint isn't a valid constraint. The real constraint is the lack of any incentive to get an education. Why do so when you can't keep your income?
In economics, we call this constraint institutional. Institutions are rules of the game. In a wealthy country, we take rules as given, and we take them for granted. Consider a fundamental institution, property rights. In a wealthy country, we know things get stolen, but we don't seriously consider not going to work cause tomorrow, if we get paid, it will be stolen anyway. This is what people in emerging countries face, why work, why go to school when there is no security?
If we seriously consider, which many economists do, institutions as the binding constraint on poverty in the poorest countries, then crypto can solve the problem. It allows the poorest to have property rights. It gives them an incentive to build skills. The downside is rather obvious; crypto opens up the world to a degree. But only to a degree. It can't physically take someone out of a developing country and put them in a rich one. It only can help in certain aspects. If you earn a living taking eggs to a market, it doesn't matter if you are paid in local currency or bitcoin. However, it will certainly change the incentive to get out of that line of work.
This is the most critical aspect, the dynamic one. It will change the incentive to get skills. If in the future you can work in a highly productive online world where you keep what you earn, well then, crypto might not help right away, but it certainly helps in the long run.
In turn, this changes the incentive governments have. If you can easily take the profits from the talented in your country, well then carry on. But what if the profits can be hidden? What if you can't get your hands on them? This is a lesser appreciated story behind the collapse of the USSR. Simply, the talented started to leave. The tax rate on the talented went from 100% to 0%. That's a big change, and one government can't live with no matter how oppressive. So then they have to let the talented keep some of the profits. It's dynamic. It changes the incentives to both citizens and governments.
In the end, can this really solve global poverty? Well, I am interested to find out!!
