Cryptocurrencies are often dismissed as vehicles for speculation – an asset class that has no intrinsic value.
But this is a naive, underdeveloped and misinformed argument, especially when you consider how digital assets are being used as a modern financial education tool.
Jay-Z and Jack Dorsey recently teamed up to launch “The Bitcoin Academy,” with special classes for kids ages 5 to 17.
This is all very exciting and it is just the beginning. There are great opportunities for crypto to breathe new life into finance education in the world’s classrooms – and compelling applications that go far beyond telling young people who Satoshi Nakamoto is.
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Crypto classrooms in action
While “crypto classrooms” are something to strive for, there are challenges to overcome. Many educators are just starting to get to grips with implementing Web2 technology in their day-to-day classes – let alone digital assets.
Fear is a very real barrier, and the perception of crypto as gambling or a risky investment will take time to eradicate. Concerns about safety also mean that schools are unlikely to devote any curriculum space to it.
Despite this, failing education systems are one of the most pressing problems facing the world, aside from climate change and population. Simply put, current educational models do not properly prepare children for the world they find themselves in.
Eight- and nine-year-olds don’t need to understand what a blockchain is, or master the nuances between Proof-of-Work and Proof-of-Stake. But practical lessons that focus on the concepts they already understand and build the principles they need to navigate the 21st century economy are desperately lacking.
Anyone who has children this age already understands that pocket money is now on a bank card and has to be online. You just can’t do it with cash anymore. Kids use their online money to buy both digital and real assets.
These expenses take place in worlds where our kids live outside the classroom – just look at Roblox or Fortnite. And while the migration to metaverse-like experiences has already happened in Generation Alpha, there is almost no education on how to manage the financial resources, security mechanisms, and digital identity that underlie it all.
There are no structured educational models for digital ownership or the transfer of digital assets, although many of these children own digital assets and are already generating income. For example, in the NFT-based creator economy, kids ages 11 to 13 have launched art collections that have generated large revenues, such as Weird Whales creator Benyamin Ahmed and Long Necked Ladies creator Nyla Hayes.
Currently, Class Dojo, a virtual reward system used by 50 million students around the world, is one of the most popular platforms in classrooms. Kids are used to being rewarded virtually and are already leading hybrid online/offline lives.
Efforts are being made to change the status quo. Blockchain-based educational initiatives allow courses created by educators to be published collectively in NFT form. Proceeds can then be used to create even more resources. Through these courses, students can now confidently navigate Web3’s financial structures, portfolios, and inverse. Child-safe crypto wallets are also being launched for parents to actively monitor, enabling young people to navigate the industry safely yet independently.
The importance and value of mimicking real life situations in the classroom is paramount. And there are ways to add an exciting extra dimension to all this. What if teams of students had to work together to decide how to issue virtual tokens?
The concept of digital ownership is absolutely essential to the emerging world of decentralized economies, especially as future generations are more likely to manage their wealth rather than hand it over to banks and centralized exchanges. Future generations have the right to know early on how to manage their money wisely. And if the concept of blockchain clicks with them at a young age, they have the time and opportunity to prepare for a thriving career.
Related: Crypto Is Becoming An Inflation Hedge — Just Not Yet
Why this matters
At this point, you may be wondering why cryptocurrencies are needed for all this. You might be tempted to argue that schools have already completed financial education. But this couldn’t be further from the truth.
Just look at this recent study from the UK by Student Beans. Young people owe an average of £2,000 ($2,171) on credit cards and overdrafts. Why? Because no less than 89% say they did not know how to handle it responsibly. This is a scathing indictment of the education system in its current form, and it is an image that is being repeated in countries around the world. In addition, 52% don’t know how interest rates work – and 69% want more budgeting guidance.
A lack of financial literacy can have a devastating impact on mental health. And understanding how investments work – and how to grow savings – are skills every person on the planet deserves. Cryptocurrencies have helped democratize and demystify the world of wealth, with onboarding in minority sectors at an all-time high, but the message still needs to get through to billions of people so we can work together to build a decentralized, financially literate world.
Josh Cowel is a builder, spokesperson, researcher and champion of blockchain technology and crypto since 2010, paralleling operating in TradFi risk over the past decade. He is the head of product at XGo, where he is driven to restore crypto to its original goals, which is not making any quick money.
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