About 17 years ago, my daughter took out a government-funded student loan to pay for her college education. Like most college students, she opted for payment deferral while financially struggling to live on meager wages and complete her education. At 4% interest, it couldn’t be that bad, or so she thought.

Thirteen years ago, she began her pay-back journey. While preparing her 2022 taxes, she discovered that over 50% of her payments go towards interest and that she owes more today than she did when she took out the loan 17 years ago.

How can that be?

She did not realize that her 4% interest was compounded daily and that every penny of that interest during the four years of her payment deferral added up to thousands of dollars — money that continues to accrue daily compounded interest.

There is something wrong with a system that allows financial institutes to treat young Americans this way. It is equally alarming that a government would allow its young adults to be treated this way.

The proposed student forgiveness plan fails to mention that the federal government sells its loans to private lenders, thus negating the “forgiveness” of the loan.

Why am I writing about this?

You could build a case that I am responding as any aggravated parent would over such news. However, I am writing to point out the need for a change in our financial system, a change that cryptocurrency will usher in.

The decentralized, peer-to-peer nature of the cryptoverse would eliminate horror stories like my daughter’s.

The innovation of smart contracts can be coded to accommodate cost-specific loans — such as educational loans — to add a peer-to-peer agreed interest during nonpaying accumulation that is fair and equitable between each party.

Crowdfunding and institutional grants can be created as collateral against such loans to assist students in financial need.

Third-party — i.e., government and lending institutions — middleman involvement would become a thing of the past.

How this impact everyday people

It is still a dream but has real potential in a decentralized financial world. A couple of years ago, I wrote an article, The weight of a failing system part 1, in which I discussed the need for change.

Blockchain technology advances have opened up new ways of conducting business, interacting with people, and entertaining ourselves. Cryptocurrency is only one aspect of that change. It is only a matter of time before the cryptoverse becomes mainstream, replacing an antiquated system.

The cryptoverse is for you. Join me as, together, we take the most unexpectedly incredible journey down the many paths it has to offer.

Disclaimer: I am not a financial planner, and therefore do not offer financial advice. I am an avid student of the cryptoverse who is willing to make available the things that I learn to everyday people willing to take a chance, change, and explore your financial freedom in the cryptoverse.

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