With everything going digital the currency has seen a huge change itself. The global economy is moving online with the use of new form of currencies. There has been digitalization in transactions with internet banking and many digital wallets, the latest addition to the digital monetary worlds is the introduction of cryptocoins. The currencies are used like any other currency -Dollar or Rupees but do not have any physical existence. They are used as digital exchange and defined as currencies that are virtual or digital and uses cryptography for ensuring security.
There has been a huge increase in the number of these currencies that are dealt in. The currency is not issued by the government hence it cannot be taken away from the owners. This has created a lot of popularity amongst the normal individual who is thinking about investing in the virtual currency. There are many reasons which have lead to the trust of the population on this currency and it has taken its time to create that but truth be told the popularity grew faster than many other economic products and the reasons for the same are explored further in the article.
How Did It All Start?
The first ever cryptocurrency that was introduced was in 2009. It has taken a little over 5 years to make it popular all over the world. The first currency uses blockchain technology and has generated huge gains over time. When it is compared with gold which another popular trade commodity the gains by bitcoin were 155% compared to Gold which was close to 6% over the last half a decade. Ever since the blockchain technology has gained a lot of popularity, but providing all the credit to bitcoin for that would be a little unfair. It is also popular due to the awareness about its importance and the huge trust that the investors have built over the time.
Current State of Bitcoin
- Bitcoin which started at 0.06 per coin USD in the year 2010 is now worth more than 4000 per coin USD. This makes it a highly profitable investment available in modern times. It has brought a lot of changes in the way people deal with currency now.
- The interest of major banking institutes like Barclays, Intel, and Walmart has altered the way many countries see these cryptocurrencies. These companies have made an investment of time as well as money on these currencies which has allowed the countries with weak currency to make a shift and allow the virtual currency to take the place of the physical currency.
- The countries which have shown the change are Turkey, Colombia, Brazil etc. which are using mainly Bitcoin and Ethereum which are popular amongst the whole list of cryptocurrencies.
According to ICO Token News, there are speculations where many other countries will join the bandwagon. These names include Holland, Japan, and EU where a lot of research on these currencies is being made. It is evident that a huge change is just around the corner.
Power of Cryptocurrencies to Bring A Change in the Economy
Crypto currencies are becoming popular due to many reasons and he major amongst them are
The way the currencies are handled shows that there is no chance of any identity theft. The ledgers make sure that the transactions made between the wallets are matched to the right balance. The public ledger which is known as transaction block chain also ensures that the coins used are owned by the spender. The check on the transactions does not lead a lot of scope for any identity theft. The popular technology is used to secure all the transaction with the help of encryptions. There are smart contracts which do not allow the identity to be hacked despite any effort. This is safe to say that the blockchain technology is going to have a strong impact on many segments of our life.
With the use of the encryption the currency is safe. The public ledger is created which contains most of the information. The coin owner’s identity is recorded to ensure that the dealings are legitimate. The currencies are decentralized which means there no authority that owns it other than the owners themselves. There is thus no identity conflict as well. No bank or any financial institute has any control over the currency. The cases of fraud thus are far from existent as the owners have full control over all the happenings.
There are no direct fees for dealing with the cryptocurrency. There are miners who would request compensation for their work which is provided to them by the network. This ensures that the owners of the currencies do not have to pay any extra money for dealing with their own currency. There could be questions about the fees that you might have paid or heard someone pay for dealing with the currency. This is because of the platform they choose to exchange or trade in these currencies.
There are a lot of steps in the process when you are making an investment in a physical property. It will involve third-parties and wait period before the transaction will be complete. The crypto currencies have a feature which is sure changing the world, the contracts regarding exchanges or trades are pre-designed, they can eliminate the involvement of any third-party and make the transactions quick.
The cryptocurrencies are traded over a global network of the system which use block chain technology to manage currencies like Bitcoin or Ethereum. The whole management is by networks and not any banks or financial institutions. This gives a lot of power to the owners to deal with the currency. The whole management is done by these networks on the basis of the owner. The whole process is being investigated to ensure safety but from the ownership point of view, there is nothing to be concerned about.
Recognition On the Global Scale:
Since the currencies are not bound by any institutes and exchange rates they can easily be traded without any issues. There are no transaction charges or any country trade limitations hence it is appropriate for global exchange without hassle. It is recognized as a suitable method of transfer’s money in less time without having to waste extra money on transfers from one country to the other. This is just appreciated by business as well as an individual when they deal with it. There is a single form of operation and universal presence which makes it popular in global stands.
There are no limitations to who can deal in the currency and who cannot. There are currently 2.2 billion individuals who have access to the internet and still no access to the traditional method of exchange. Part of these people currently finds the access quite easy and beneficial and efforts are being made to familiarize others with the process to get them on board. Since it is easy to own and transfer it is gaining popularity amongst everyone.
Reasons Behind the Popularity of Cryptocurrency
The technology which is being mentioned time and again is the main reason why so many features are provided with Cryptocurrencies. It has additionally enabled the companies to offer the ICOs which is Initial Coin Offerings. The fact is that these digital coins which are offered as ICOs for raising funds by the companies are not regulated. Despite the fact, the process is common and has gained popularity based on the above-mentioned reasons. The trust has been built and with the whole world dealing in these currencies, the popularity is increasing.
The fact that any other currency that we deal with is regulated by some authorities which have created certain issues in the past and thus the favor for these decentralized currencies are increasing.
The uses of the virtual wallets are also very common but when people think about it in deep they have realized that they do not hold all the control over them. What if the company suddenly decides to shut operations or misuses the power vested in them. What control do they have over it? The lack of other such avenues is also the reason that the cryptocurrencies have gained momentum. The access to the keys (Private and Public) with the owners and that is what makes the address of the currency. Now taking that away is not possible by any third-party. The risk with these currencies is only that it can be lost that too only by the owners themselves. If they use a third-party wallet then they are under the same risks as any other wallet.
The awareness about these currencies is increasing at a slow rate. There is a huge chunk of the population which is not aware of them. The whole world will see a huge shift in the whole usage when this part of the population will start dealing with the currency.
The reasons for the popularity will increase in the coming years as there is a lot of research going on about these currencies.