Cyprus Mail
BusinessCryptocurrenciesSponsored Content

Does our future lie with Cryptocurrencies?

image 04

The world is changing as you are reading this. Human beings are not exempt from evolution, and as with all living things, we evolve. Where the development of using the currency for trade was once a part of that evolution, the way we deal with money and its different forms are also evolving.

One of the biggest changes that we have had the privilege of experiencing in our lifetimes is the development of cryptocurrencies. By now, most of you reading this will have some clue what we are talking about, but we will explain for those who do not know the vast differences between your typical fiat currency and the cryptocurrencies like Bitcoin, Ethereum, and Litecoin. Visit https://cryptogroupsoftware.com/ to open a free crypto trading account.

Fundamental differences between Crypto and Fiat currencies

 Before fiat currencies, money was valued according to commodities of the earth like gold and silver. In 1971, the US government ended the commodity-based currencies by putting an end to the dollar-to-gold exchange and became a fiat currency. This means the currency is regulated by the Federal Reserve. When this happened, the world followed suit.

Cryptocurrencies are unlike fiat currencies because they are decentralized from any government control. The value of the currency is created virtually, or digitally, and it is managed via a blockchain that records all transactions made. A blockchain is essentially a distributed ledger made up of a network of different computers. All the transactions are recorded within the distributed ledger with the use of cryptography. Once this happens, it cannot be changed or manipulated. Unlike fiat currencies, cryptocurrencies are not controlled by a sole authority, but rather the rules that the network was programmed with.

Advantages and disadvantages with Fiat currencies

There are a few advantages to using this form of currency. For one, it can be reliable if your country’s currency is stable. If you kept your fiat currency at a bank that is governmentally regulated, you would benefit from the insurance that these facilities can offer in the case your funds are lost.

There is no denying the chaos the world has been facing currently, and there is no surprise that the financial situation is feeling pretty grim in terms of the fiat currencies of the world being shocked by the global pandemic. A worldwide lockdown was not the first time we witnessed a financial crisis either. If the world’s fiat currencies are so easily rocked, how much longer can we rely on them?

Advantages and disadvantages with Cryptocurrencies

Cryptocurrencies’ structure is decentralized and managed by a network of computers. Everything is transparent, having all transactions visible to both parties involved. This makes it much easier for the IRS to track down any fraudulent activity as well as makes the need for an intermediary redundant. There is not one authority company calling all the shots, and the currency’s value remains the same across the globe, which allows the average person can make transactions on an equal footing.

Cryptocurrencies allow users to gain more financial control over their transactions and the privacy they wish to maintain. This is because there is no need for an intermediary or a waiting period for the intermediary company to approve the transaction, so the process takes much less time.

Another benefit is that there are no borders with cryptocurrencies. This means you can transact with other cryptocurrency users all around the world! Not only that, but the transaction fee is particularly low in comparison to the typical fees you might expect with fiat currencies. This is one of the main reasons why it has become a popular method for sending money internationally, plus the addition of apps like Bitcoin Era, which trades for you.

Which is better?

 This is an answer that is totally up to you to answer. You might be in a country where the fiat currency is mostly unstable, and you are struggling to improve your financial situation. Cryptocurrencies might have some disadvantages, but so do fiat currencies. Which do you prefer? The security that your money is safe? Or the freedom to take the leaps other banking institutions might delay, or even prevent.

Follow the Cyprus Mail on Google News

Related Posts

Tourist arrivals increase 5.4%

Andria Kades

Cyprus Business Now

Kyriacos Nicolaou

Industrial policy for economic security

CM Guest Columnist

ECB ‘crystal clear’ on June rate cut, de Guindos says

Reuters News Service

Banks falling behind on messaging app scrutiny, survey finds

Reuters News Service

IMF committee acknowledges conflicts risk but opts against joint communique

Reuters News Service