It isn’t an exaggeration when I say that cryptos are the future. We are not too distant from the time when we’d be buying coffee using digital coins.
Cryptocurrency is a growing phenomenon that is vastly being accepted across the globe. According to Statista, the number of cryptocurrencies users has increased by 66 million between 2018 and the last quarter of 2020. The public and private sectors are feeling secure at the idea of adopting cryptocurrency as their transaction mode.
What is cryptocurrency?
Cryptocurrency is about using coded communication to protect information. It ensures that only intended parties could read or process the info. It has become a medium of exchange for goods and services. They utilize coded information to record transactions.
Bitcoin is a widely popular example of cryptocurrencies. It is secured by a Secure Hash Algorithm (SHA). If you identify a unique thing using a distinct digital reference, then there is a minor modification in that reference. The special thing is no longer represented. A hash value serves as a cryptographic equivalent of the “thing.” It could be a digital fingerprint or a unique identifier.
The example of Bitcoin demonstrates the significance and reliability of cryptocurrencies. Most developed nations are already operating on this financial medium.
Why is cryptocurrency the future?
Cryptocurrency is the technology that has helped to develop and evolve several encryption techniques. This is to make the cryptocurrency network secure and reliable to proceed with different transactions. BITAMP
However, as per Age UK, about 2.4 million above 65 years (representing 12 million people) still rely on cash to survive. Perhaps, the cybersecurity threat landscape has become more threatening in well-developed countries like the UAE fuels their doubts.
Despite these figures, we cannot remain oblivious to the wide scale acceptance of cryptocurrencies. So far, there are 5000 cryptocurrencies, and the number is growing with time. Here are the five reasons I believe cryptos are the future:
- Decentralized Finance
The gap for a secure and transparent economic system was quite evident and increased with time. It was because of the failure of the current financial system that was not providing credibility and financial freedom to the users. Many people perceive decentralized finance (DeFi) as a structure that will bring better transactional security and transparency. It is anticipated to modify the conventional financial procedures soon.
DeFi is quickly gaining momentum in trading, investing, lending, and borrowing. This can catalyze a revolution in the current financial services. The high demand and accessibility of crypto exchanges have enhanced the popularity of several DeFi systems available. Investors are also exploring the rewards associated with cryptocurrencies.
Thus, cryptocurrency is expected to push changes in the financial system. The DeFI created on a public Blockchain has become a more suitable alternative economic system that offers plenty of financial services. Anyone anywhere can connect with it. Plus, it also provides transparency.
- Not associated with world governments
In some nations, cryptocurrency is readily accepted as a value store. Nonetheless, it is not ideal for transactions if there are better alternatives. One of the reasons people have placed faith in cryptocurrency is that it is not related to world governments. It has the potential to remain stable even when there is political unrest in the country.
Some investors perceive cryptocurrency as an excellent way to protect their wealth. This is why the mode has witnessed massive growth over the past few years. The fact that cryptocurrencies could be safer than other government currencies makes them more appealing.
- More actors are receptive to cryptos
Cryptocurrency has turned into a widely accepted financial system. Both public and private sectors are showing great interest. This is why it has become a part of their transaction structure. Tech-focused corporations, institutional investors, and even central banks worldwide have started incorporating cryptocurrency in their operations.
Not only this, but the automotive sector is also following suit. You can now buy a Lamborghini using cryptocurrencies.
Consequently, new policies and regulations are put in place to create regular practices in the future. These policies are being used to keep all players in check as more players continue to leap into this landscape.
- Banking and transactional perks
The accessibility and security provided by cryptocurrency keep it in the limelight. Its cryptographic technique and technology continue to evolve, creating a better and more powerful currency system.
Following are some of the rewards it brings to the financial system:
Security
Transactions happening through cryptocurrency cannot be changed. It transmits in a highly secure network. Although, you can trace the financial records for proof.
Privacy
It allows the user to remain anonymous during the transaction because different cryptographic techniques power the system. Such methods guarantee data protection to prevent information from going into malicious hands. All data stays hidden from unauthorized personnel.
Efficiency and access
Many people across the globe are still living without a formal financial structure. Cryptocurrency offers a concrete solution for such entities.
- It is easy to use
With more companies adopting crypto payments, it has turned into a fairly simple payment mode. Websites have started to accept cryptocurrency as payment, and this will continue to increase in the future. It is interesting to note that there are the latest developments like cryptocurrency debit cards. This is not as widespread, but it seems to be a growing domain.
Cryptocurrency will reach more people due to increasing awareness. More people are looking for answers related to this field. The curiosity of individuals and companies, coupled with its easy-to-use method, will compel cryptos to progress.
Different values of cryptocurrency
It doesn’t have an intrinsic value. Yet, it offers value in the following ways:
Privacy
It allows the users to remain anonymous
Stable coins
It can attach to commodities like gold or oil
Digital gold
Both cryptocurrency and gold can be used as an exchange medium with storage value
Wrapping Up
Cryptocurrency is an exciting prospect for early adopters. It could be anxiety-inducing for those who are uncertain and greatly rely on traditional money. I recommend everyone out there to research more, read more, and then act. A research-based decision will allow you to take each step with caution and control. Cryptocurrency may become the future. However, one should never let their guard down. Right?
