Cryptocurrency has gained massive recognition and adoption around the world – people, organizations, and nations of the world have resulted in the use of cryptocurrency in their transactions, this is due to the decentralized nature of cryptocurrency and its user-friendly nature. Cryptocurrency is seen as an easy route to exchange without ambiguity.
In some nations, cryptocurrency is seen as a means of survival and an escape from the use of fiat currency – to some, it is a store of value.
As cryptocurrency users continue to grow to an extent where cryptocurrency ATMs are built for crypto transactions in different parts of the world, banks and other money regulatory bodies feel threatened by this global adoption since it cannot be controlled. To save other fiat currencies, some countries have placed bans on cryptocurrency transactions and deactivated any account with crypto-related activities among other actions taken by the monetary bodies.
Since cryptocurrency is rocking all corners of the world today, some people have asked if cryptocurrency is the future of money or not. In this article, we will find the answer to the question above but before then, let’s briefly discuss what cryptocurrency is in a nutshell.
What Is Cryptocurrency?
Cryptocurrencies are digital currencies and assets that are used as a means of transaction or exchange with the use of cryptography backed by blockchain technology.
There are various cryptocurrencies in the world today, the first cryptocurrency is Bitcoin which was created by an anonymous group or a person known as Satoshi Nakamoto in 2009. Since the inception of Bitcoin, there have been several cryptocurrencies created that are regarded as Altcoins as well as tokens and projects that are backed by Blockchain technology.
Cryptocurrency can be stored in a wallet either a cold or hot wallet just as fiat currencies can be stored in banks, it can be swapped, mined, staked, and traded in an exchange. Cryptocurrencies are highly decentralized and transactions can be done using a peer-to-peer network which contradicts bank transactions that are regulated.
Cryptocurrencies are largely accepted in various parts of the world but one may ask; is cryptocurrency the future of money?
Let’s consider the above question.
Cryptocurrency And The Future Of Money
Crypto as a threat to fiat money has faced sanctions and regulatory bills in various parts of the world but this has not been able to curb the widespread use of cryptocurrency and its acceptance as a medium of Exchange. Money itself is a medium of exchange whether fiat or digital, cryptocurrency is the digital aspect of money since it has become a means of exchange in various payment Platforms.
Platforms like PayPal now accept bitcoin as a means of payment, Uber also suggested its acceptance of bitcoin as a means of payment. In some countries like El Salvador cryptocurrencies are accepted as a legal currency for transactions in the country, and countries like Malta, and India are also working on doing the same. This shows that bitcoin is already penetrating globally as a means of exchange and that means serving the purpose of money.
Money is not tied to any type of currency, money has continued to evolve from one means to another since humans started transactions on earth. In times of old, trade by barter which is the exchange of goods for goods and services for services was the means of transactions.
To make life easier, fiat currencies ranging from coins to paper money were accepted as a means of payment, and the banks were created to store and ease this transaction process.
Cryptocurrency with its acceptance can be said to be ready to serve the purpose of money as exchanges and wallets now serve the purpose of banks and even more. The diversity of cryptocurrency ranging from coins to thousands of tokens and its decentralized features make it much more accessible and easier to transact, cryptocurrency is also one of the fastest means of payment.
In times of crisis, cryptocurrency has served as the last resort for easy transactions when banks are not accessible, the case of Ukraine and the Russian war proves this to be true. With the innovation of technology and its rapid discoveries, it will not be surprising that cryptocurrency becomes the future of money. The world is gradually becoming a digital space which makes the acceptance of cryptocurrency even more believable instead of fiat currency.
We can not possibly state that cryptocurrency will eliminate the use of fiat currencies and physical banks as nations around the world will continue to fight the course of sustainability of fiat currency and banks to preserve the money regulatory bodies of the world.
Whether cryptocurrency will eliminate the use of physical cash and establish its use as the medium of exchange in the future or not, anyone can own cryptos and trade them in any safe exchange.
The more the world becomes digital, the more the need to adopt cryptocurrency like countries such as El Salvador has done will arise. The thought of exchanging goods and services with instant cryptocurrency payments is exciting to a digital generation.
The major threat that might extend the acceptance of cryptocurrency as the only means of exchange in the future is its high volatility and risk of decreasing value in a bear market.
The opinion in this article is solely based on the writer’s perspective and not a reliable prediction as the future cannot fully be predicted.