Cryptocurrency is a relatively new phenomenon that was initiated with the introduction of Bitcoin in the late 2000s. Bitcoin and other cryptocurrencies offer the advantage of blockchain technology. This technology is not dependent on a central authority or any specific payment gateway.
Cryptocurrency networks work on the principle of P2P transactions, which means that people can perform transactions without any intermediary. The entire system is decentralized. Let us discuss why it is a good move to switch to cryptocurrency.
Due to inflation, most international currencies have taken a blow, and their values have declined. Whenever a cryptocurrency is introduced, the quantum of the currency is fixed and rigid. The total amount of any coin is ascertained by the ASCII computer file. For instance, the total number of Bitcoins on earth is just 21 million.
As the demand for Bitcoin grows in the future, the price will also increase. This will work based on market forces and shield you against inflation’s harmful effects.
You can easily transact with the help of cryptocurrencies and at a minimal cost. The transactions done are also secure and private in nature. All you need is a mobile app and an exchange waller (cold or hot), and you can easily send and receive different kinds of cryptocurrencies.
There are some Bitcoin ATMs, too, where you can acquire various cryptocurrencies such as Ethereum and Bitcoin by paying cash upfront. You don’t necessarily require a bank account to start dealing with cryptocurrency. You can purchase the coins at an ATM and subsequently transfer them to your mobile.
To transfer money from one country to another, there are hardly any ways faster than cryptocurrency that can do this job. Many transactions require a time of around 4 to 5 days when done using financial institutions, and a wire transfer could take one day to complete. If you are a stock trader, you would know that even the shares are settled in three days.
Cryptocurrencies offer the massive benefit that the network can settle their transactions in significantly less time. When the block that holds your transaction gives a positive signal, the transaction is said to be settled, and you can claim your funds.
This is a vast advantage enjoyed by cryptocurrencies. They are completely decentralized and are managed by their developers who use them and have a large quantity of the coin. They launched it into the market soon after.
Due to this decentralization, there are no monopolies in the currency system, and it remains bounded. No individual or company can dictate the currency’s value or flow, which contributes to its stability and security. This is in contrast with fiat currencies which are operated by the central bank of a country.
Cryptocurrencies operate on the principle of blockchain security and cryptography. They are decentralized, and hence transactions done through them are perfectly secure. This is one of the most valuable advantages they offer.
The hash rate can be credited for the security offered by cryptos. If the hash rate is more, one would need more computing power to meddle with the network. The safest cryptocurrency is Bitcoin, with the largest hash rate.
Mostly everyone can access cryptocurrencies. The only requirements are a PC or a mobile phone and a working internet connection. You can easily create an account on a cryptocurrency wallet which is not the case with conventional financial corporations that require some documentation and frequent visits. Wallets don’t verify your credit score or background either.
You can avail all sorts of financial services using cryptocurrency without ever opening a bank account. One might not be comfortable opening a bank account due to a range of factors. Cryptocurrencies can act as a boon for these people who wish to transfer money or assets without the help of a bank.
It has been widely seen that Bitcoin has fared very well when it comes to giving good returns on investment. In its initial years, Bitcoin had zero value. But subsequently, its value climbed up to a small amount, and now, it is valued at more than $10,000.
This translates into gains of a million percent. Traditional indexes don’t provide gains of more than eight percent yearly on average. Several altcoins have fared better than Bitcoin, but most of them witnessed a shocking dip in prices. These gains are a valid enough reason for investors to believe that cryptocurrency is a good investment.
These reasons point to a simple conclusion: one cannot prove that cryptocurrency has no utility or benefits over fiat currencies. Cryptocurrencies offer benefits that can look attractive to people who prefer the conventional route of banking transactions. The road ahead also looks attractive with more technological advancements.