Since its creation a decade ago, Cryptocurrency has experienced a series of ups and downs. Sometimes, the digital currencies appreciate to investors’ delight while it also occasionally depreciates too.
The price fluctuation has cast doubt on the durability of Cryptocurrency in recent times. Some believe that it won’t pass the test of time.
Well, that opinion is flawed. This article discusses some reasons why digital currency is here to stay. Consider some of them:
1. It is Immutable
Cryptocurrency is created on Blockchain technology, an innovation that is known for its immutability. This implies that Cryptocurrency literally can’t die.
This technology will continue to exist for as long as the computers that are running its nodes are doing their jobs. Only the destruction of electricity and the Internet can kill the Blockchain technology. This is unlikely to happen.
2. An Alternative to Fiat Money
Cryptocurrency also plays the role of fiat currencies such as the British Pounds, the US dollars, Euro, and a host of others.
As a means of exchange, cryptocurrency offers some benefits that are alien to fiat currency. These are low fees, instant money transfer, absence of a third party, and several other benefits.
Payment with Cryptocurrency spares you the stress of making a manual payment that will take days. This is especially challenging when making international payments that may take weeks to confirm.
The several benefits of Cryptocurrency make it a perfect payment alternative to regular currencies. Both the sender and receiver can get their transactions over in a couple of minutes.
3. High Volatility
While some people consider Cryptocurrency’s volatility as a disadvantage, it’s actually one of its advantages. It is a plus for investors who are following the trend in the Cryptocurrency space.
Such investors can invest when digital currencies hit the bottom low. They stand a chance to make a reasonable ROI once the market picks.
4. Growing Investment in Cryptocurrency
Recently, Facebook launched its digital currency, Libra. Before this, several other enterprises that were previously not involved in Cryptocurrency are currently investing in their digital coin.
Notable examples include JP Morgan, Amazon, Walmart, Air Asia, and what have you. These enterprises are creating their cryptocurrency because they are fully aware of its long lifespan.
5. Awesome Innovation Potentials
Are you aware of the potentials hidden in Cryptocurrency? Perhaps you are not. It’s good to note that digital currencies are not used as a means of exchange only. Some of them are built on Blockchain technologies that allowed them to explore. A typical example is Ethereum. It is the brain behind several innovations such as Smart Contracts. This special technology has touched multiple areas of human endeavors. It covers health, insurance, education, politics, and an array of other applications. All thanks to cryptocurrency and Blockchain technology.
6. It Prevents Inflation
One of the several disadvantages of fiat currencies is inflation. From Zimbabwe to Venezuela, the story remains the same. For decades, powerful bodies have failed to find a lasting solution to this problem. The UN, World Bank, and the UN have been unable to solve inflation challenges.
Digital currencies solve this issue. Coincodex gives an insight into how Cryptocurrency achieves that. It said:
The artificially set total supply of 21 million BTC is about to eliminate BTC’s inflation.
While the total number of Bitcoin and other digital coins are known, that of fiat currencies remain unknown. This explains why it is easier to control inflation with Cryptocurrency than with the others.
7. It Eliminates Third-Party
Cryptocurrency also offers transaction freedom by eliminating third-party intervention. Without digital currency, business owners and their customers alike depend on third-parties. It was impossible to conduct international or intercontinental businesses without an intermediary.
Such an arrangement came with tons of challenges. The intermediary’s fee will hike up the cost of a transaction. This will also increase the purchasing cost of the product or service. As a result, the selling price will increase to accommodate the extra cost.
Cryptocurrency, however, eliminates reliance on third parties. Transactions can be done without passing through a medium. The result is cheaper products and items.
8. It Creates Employment Opportunities
Through Cryptocurrency, hundreds of thousands of people are fully engaged. The digital currency boom created the need for developers to create more coins. Several Cryptocurrency exchanges were created to attend to the needs of crypto enthusiasts.
This is aside from the several institutes that provide investment training in digital currency. These are some of the crypto-based employment opportunities people are taking full advantage of.
9. It Makes Online Shopping Safer
Fraud risk is one of the reasons many shoppers limit their online shopping engagements. As hackers target debit/credit cards, people became more conscious of their activities. This hurts both the consumers and e-commerce operators.
Digital currencies are safer. They are not prone to hacking and other illegal activities like their competitors. Once digital currency removes the fear of fraud, shoppers are more willing to make purchases. They are comfortable doing that in the knowledge that their transactions are safe.
10. It is Ideal for Crowdfunding
Through ICOs, cryptocurrency has surpassed every other fundraising means. It is currently the most widely used means by startups for raising capital for projects.
Since its release, Ethereum has helped startups to raise more than $18 million. A 2016 report shows that it reached some $1 billion market cap in that year. Thus, startups are looking for opportunities to raise the needed fun through digital currencies. They are leveraging the ease at which they can use the platform to raise capital. Since it is safer than fiat currencies, they feel comfortable with Cryptocurrency.
Many people indeed have reasons to believe Cryptocurrency will soon become a part of history. Nevertheless, there are abundant pieces of evidence to show it has come to stay.
An increasing number of individuals and organizations accept Cryptocurrency for their daily transactions. Inventors are exploring other hidden potentials of this technology. They may come up with outstanding uses of digital currencies in the future.
If this trend continues, it is safe to admit that Cryptocurrency has come to stay. It is the currency of the future.