What will the ongoing future of money seem like? Imagine walking into a cafe and looking up at the digital menu board at your preferred combo meal. Only, in place of it being coming in at $8.99, it’s shown as.009 BTC.
Can crypto really be the ongoing future of money? The answer to that particular question hinges on the general consensus on several key decisions which range from simplicity of use to security and regulations.
Let’s examine both sides of the (digital) coin and compare and contrast traditional fiat money with cryptocurrency.
The very first and most important component is trust.
It’s imperative that individuals trust the currency they’re using. What gives the dollar its value? Is it gold? No, the dollar hasn’t been backed by gold since the 1970s. Then what is it that gives the dollar (or any other fiat currency) value? Some countries’ currency is considered more stable than others. Ultimately, it’s people’s trust that the issuing government of that money stands firmly behind it and essentially guarantees its “value.”
So how exactly does trust use Bitcoin since it’s decentralized meaning their isn’t a governing body that issues the coins? Bitcoin sits on the blockchain that is basically an online accounting ledger that allows the world to view each and every transaction bitcoin. Each one of these transactions is verified by miners (people operating computers on a peer to peer network) to avoid fraud and also ensure that there is no double spending. As a swap because of their services of maintaining the integrity of the blockchain, the miners receive a payment for each transaction they verify. Because there are countless miners attempting to earn money each one checks each others benefit errors. This proof work process is why the blockchain never been hacked. Essentially, this trust is what gives Bitcoin value.
Next let’s look at trust’s closest friend, security.
Think about if my bank is robbed or there’s fraudulent activity on my credit card? My deposits with the bank are included in FDIC insurance. Chances are my bank will also reverse any charges on my card that I never made. That doesn’t mean that criminals won’t be able to accomplish stunts which are at minimum frustrating and time consuming. It’s just about the peace of mind that comes from understanding that I’ll most likely be made whole from any wrongdoing against me.
In crypto, there’s plenty of choices when it comes to where you should store your money. It’s imperative to learn if transactions are insured for the protection. You will find reputable exchanges such as for instance Binance and Coinbase which have an established background of righting wrongs because of their clients. Just like there are less than reputable banks all around the world, the same is true in crypto.
What are the results if I throw a twenty dollar bill in to a fire? The same is true for crypto. If I lose my register credentials to a particular digital wallet or exchange then I won’t be able to have access to those coins. Again, I can’t stress enough the significance of conducting business with a reliable company.
Another issue is scaling. Currently, this may be the largest hurdle that’s preventing folks from conducting more transactions on the blockchain. When it comes to the speed of transactions, fiat money moves much quicker than crypto. Visa can handle about 40,000 transactions per second. Under normal circumstances, the blockchain can just only handle around 10 per second. However, a fresh protocol has been enacted that may skyrocket this around 60,000 transactions per second. Known as the Lightning Network, it may result to make crypto the ongoing future of money.
The conversation wouldn’t be complete without speaing frankly about convenience. What do people typically like in regards to the their traditional banking and spending methods? For folks who prefer cash, it’s obviously simple to use a lot of the time. If you’re attempting to book a hotel room or perhaps a rental car, then you need a credit card. Personally, I use my credit card everywhere I go due to the convenience, security and rewards.
Did you realize there are companies available providing this in the crypto space as well? Monaco has become issuing Visa logo-ed cards that automatically convert your digital currency into the local currency for you.
If you’ve ever tried wiring money to someone you realize that process can be extremely tedious and costly. Blockchain transactions allow for a user to send crypto to anyone in only minutes, regardless of where they live. It’s also considerably cheaper and safer than sending a bank wire.
You will find other modern methods for transferring money that exist in both worlds. Take, as an example, applications such as for instance Zelle, Venmo and Messenger Pay. These apps are used by countless millennials everyday. Did in addition you know they are starting to include crypto as well?
The Square Cash app now includes Bitcoin and CEO Jack Dorsey said: “Bitcoin, for all of us, is not stopping at buying and selling. We do think that this can be a transformational technology for our industry, and we should learn as quickly as possible.”
He added, “Bitcoin offers an opportunity to have more people access to the financial system.
While it’s clear that fiat spending still dominates the way in which the majority of us move money, the fledgling crypto system is quickly gaining ground. The evidence is everywhere. Ahead of 2017 it had been difficult to locate mainstream media coverage. Now just about any major business news outlet covers Bitcoin. From Forbes to Fidelity, they’re all weighing in using their opinions.
What’s my estimation? Probably the biggest reason Bitcoin might succeed is that it’s fair, inclusive and grants financial access to more people worldwide. Banks and large institutions see this as a threat for their very existence. They stand to be on the losing end of the maximum transfer of wealth the entire world has ever seen.