Cryptocurrency has existed since as far back as 2009. Although, not many people were aware of it, or its impact then, but as time went by, it started gaining more obvious impact on the world.
Today, cryptocurrency is one of the digital currencies that has been changing our world rapidly.
Statista predicted that by 2025, the revenues generated from cryptocurrency should be over 39 billion US dollars. Isn't that amazing? This shows that the impact of cryptocurrency on the world is not a minor one.
A lot of businesses have taken a new shape because of the impact of cryptocurrency. How industries operate has taken a new form, it has also opened new and better opportunities for individuals.
Before going into the impact of cryptocurrency, let's have a look at what it is all about.
What is Cryptocurrency?
Cryptocurrency is a kind of payment you can exchange online for goods and services. Its value is not managed or maintained by any central authority since it is a decentralized medium of exchange. The tasks are broadly distributed among its users through the internet.
Asides from Bitcoin and Ethereum, which are the most popular, there are over 5,000 different cryptocurrencies circulating in the world.
Different companies and businesses have issued personal currencies, which they call tokens, these can be traded specifically for the good or service that the company provides. You need to exchange real currency for cryptocurrency to access the goods or services of these companies.
In the world of cryptocurrency, a technology known as blockchain is employed.
What is a Blockchain?
Blockchain is a decentralized technology that has spread across many computers which record and manages transactions.
It's an open, distributed ledger that has a record of all transactions written in code. This makes it easier for users to keep up with their transactions.
Every cryptocurrency user has a copy of the ledger so that they can create a united transaction record.
One of the benefits of this technology is its security.
There are some advantages of cryptocurrency which helped in its fast-rising.
Advantages of cryptocurrency
1. Cryptocurrencies don't need Trust
Before the existence of bitcoin, Other currencies needed a trusted central authority before they can be used. The use of these authorities is one of the major causes of the downfall of these currencies.
With cryptocurrency, each part of the network confirms the claim of the other part, hence there is no need for trust.
2. Cryptocurrency is resistant to collision and attack
They have strong focal points, hence can't be easily damaged, disrupted, or even exploited.
There is no room for self-centeredness with cryptocurrency.
3. Cryptocurrencies are irreversible
Unlike other currencies, cryptocurrencies have principles that can't be changed. Users know this and have no choice but to abide by the principles.
Some of these principles include
- Only the owner of a private key is able to transfer capital
- Every transaction is recorded on the blockchain
- History cannot be rewritten
Having known a little about cryptocurrency, how then is it changing the world?
Impact Of Cryptocurrency on The World
Crypto currency is developing the economy in a very rapid manner, same thing applies to the global social. It makes it really easy to buy resources and also promotes financial services, especially in developing countries.
It has increased the transparency of transactions, since everything is being monitored, this has therefore reduced fraud drastically, since it cannot be exploited by individuals or corporations.
Cryptocurrency is good for the remittance industry
Now that immigrant workers have increased, cryptocurrencies has a great way of improving the remittance industry.
Sending funds to loved ones could be really challenging for immigrants, because the former financial system is expensive and time exhausting, hence the cryptocurrency is a great alternative for them to transfer money at a more cost effective price and faster means.
Cryptocurrency removes the middleman
Since cryptocurrency is a decentralized technology, there is no authority that approves transactions unlike fiat currencies where central banks and financial institutions are in charge of making monetary policy.
But, cryptocurrencies work in a peer-to-peer distributed network that does not need the middleman. Now sending and receiving money from a crypto user over the network is easier.
In today's world, investors are now looking into cryptocurrency
Formerly, investors were skeptical about cryptocurrencies, but since popular virtual currencies have been doing great, they have also built their confidence and are also doing well.
Bitcoin has provided great profits, hence new investors have been investing in it. Not only Bitcoin, they also invest in Ethereum, with many life applications such as smart contracts, decentralized applications, and so on.
Cryptocurrency has provided a new way of crowdfunding
Startup companies can now offer their crypto coins for crowd funding just like in financial markets where companies offer their stocks via public offerings to get funds.
Cryptocurrency is bringing revolution to supply chain.
The supply chain security is a big concern, because the global economy depends on its security and efficiency.
The use of blockchain technology can also be employed for the improvement of supply chains, since it is transparent and also decentralized. Currencies, such as WaltonChain (WTC) and VeChain (VET), are aimed at improving the speed and safety of supply chain operation.
The Crypto world is also changing the way NGOs make money transactions
Cryptocurrencies have been used by non-governmental organizations (NGOs) to reach the underprivileged areas of the world.
The Red Cross in Italy has been accepting bitcoin donations from people to provide support for people and also boost its fund.
Cryptocurrency has also been providing a platform for creatives
Before the existence of cryptocurrency, professionals like musicians find it challenging to sell their contents, due to disturbance from middlemen such as producers, but with the use of cryptocurrencies like XRP, they can now sell their contents directly to consumers, since consumers can get access to and pay for it with the use of a real-world payment method.
The use of cryptocurrency is making the e-commerce stronger
During the lock down especially, a lot of people realized how important it is to make online purchase.
It is more comfortable and time effective than going from store to store in search of an item, but the only challenge people have with it, is the issue of fraud. Not everyone is trustworthy and some would rather do without the item than sending their money to an anonymous person.
With the use of cryptocurrency however, the risk of fraud has been reduced greatly both for the shopper and the vendor since cryptocurrency transactions are permanent. Using cryptocurrency also creates more opportunities for world-wide business.
Cryptocurrency has been helping in keeping companies and individuals responsible
There are lots of industries and companies with corrupt and illegal practices. Consumers are always at the receiving end, making it difficult for them to trust even the honest companies. Written words on paper are not enough to prove the legality of a company, hence with the use of cryptocurrency, consumers can now confirm how legal a company is before doing business with them.
Cryptocurrency is now offering a stable alternative to unstable currencies
Some countries experience quite shocking instability and inflation in their currencies, using cryptocurrency instead would help such countries and even other countries.
Cryptocurrency is accepted all over the world and it is not subjected to interests and exchange rates, hence it proffers better stability to those from countries whose economy is volatile.
Cryptocurrency offer scalability
A lot of companies have built programs specifically for their products or services. Sometimes, they use an existing service which could be customized to some extent, but they face the issue of scalability. The use of cryptocurrency has offered them great help in this regard, thereby rapidly changing the world.
Cryptocurrency gives people control over their own money
A lot of people use the bank and other financial institutions just because they don't have an alternative and keeping money in their homes is not an option as there could be economic crisis which would affect their hard-earned money.
With the help of cryptocurrency, people now have control over their money. Their savings are not in any way subject to the principles imposed by these financial institutions.
People love to have control, especially over what they own, hence the crypto world is really doing a great job in that regard.
Cryptocurrency has been encouraging scientific advancements
A lot of advancement has happened in the scientific world in just the last century, but these advancements could not be continued and collective, because critical information and data have been kept secret by governments and institutions all over the world.
With the rising technology of cryptocurrency and blockchain, these scientific roadblocks could be changed by giving individuals access to real-time data and also removing the major foundations and institutions hurdling important information.
Cryptocurrency can and is already changing the world, our world. It has passed the test of time and has gained the trust of majority, hencehas been greatly accepted worldwide.
With cryptocurrency, how people transfer and operate in business is changing rapidly.