Jed McCaleb Enables Banking Services to the Poorest

Jed McCaleb secured his place in the history of financial technologies when he founded Mt. Gox, the first exchange enabling people to easily buy and sell Bitcoin. Bitcoin was a digital technology invented by the mysterious Satoshi Nakamoto in the wake of the world financial crisis of 2008 to allow people to buy and sell, store money and transfer funds around the world without requiring banks and other third party institutions such as Pay Pal and Western Union. He devised the blockchain technology to solve the problem of how to ensure trust in digital transactions. In those early years, many people created their own supply of Bitcoin by allowing their computer power to “mine” new coins, linking their machines to the distributed database network. However, many other people just wanted to buy and sell Bitcoin, and Mt. Gox enabled them to participate.

 

While working to develop alternative financial technologies, Jed McCaleb realized many people around the world, especially in developing countries, did not have access even to simple financial services from traditional banks. There are about 2.5 billion of these “unbanked” people, according to the World Bank. Because of their poverty or their geographical isolation in rural areas, it is not cost-effective for small, local banks to provide them services.

 

Jed McCaleb realized the same blockchain technology underlying Bitcoin could serve the unbanked as well by changing how these financial institutions do business. It can link them together to reduce their costs. This allows them to provide services such as transferring money to other locations. In 2014, he and Joyce Kim co-founded the Stellar Development Foundation, and he still services as Stellar’s CTO. Stellar focuses on developing its technical capacity to help financial institutions provide greater inclusion of their customers by creating a universal financial network. He believes in using technology to improve economic conditions for people by increasing efficiency.

 

He uses the nonprofit Stellar.org to develop open source software that fills in the gaps in what’s available in the mainstream financial world. He wants to update its infrastructure to enhance the economic growth needed to improve the lives of everyone on Earth.