Bitcoin Cryptocurrency – Understanding the Basics. Is Cryptocurrency the Future of Money? 2021 Review
It’s been over a decade since cryptocurrency has started to fascinate people over social media and especially over the internet. Bitcoin has been able to rank among the top cryptocurrencies today, nobody knows about the exact origin of the currency however it popped up in mid 2008 related to a Japanese pseudo name “Satoshi Nakamoto”.
So, what exactly is this Bitcoin Currency and why has it been able to sustain its place in the financial markets. Well, the following listed reasons may give you an idea of its popularity and a piece of evidence as to its continued safe future existence.
Bitcoin Cryptocurrency Understand the Basics
- Bitcoin is the first decentralized digital currency.
- Bitcoin is an independent free-floating currency which is neither owned by any government nor associated with any other currency for it to influenced value wise by the economic indicators that govern the value of traditional currencies.
- With its growing popularity among the masses, it now enjoys an increased level of acceptability at all levels, for instance, you can now buy stuff with Bitcoin cryptocurrency directly and also trade it at different platforms such as CoinBase, Bitfinex, Bitstamp, Kraken and more.
- All you need is a wallet and an internet connection to make a peer to peer Bitcoin transfer.
- In most cases the transfers are instantaneous.
- The convenience of making transactions over the internet or your mobile phone with a couple of clicks.
- Your privacy is secure as compared to other modes of payments over the internet where your vital information can be leaked and misused.
- While transferring money through the conventional methods you have to pay fees depending on the volume of your transactions and further, these transfers are subject to your particular regional and state regulations. While transacting in Bitcoin cryptocurrency does not require you to be bound by any state regulations and furthermore, you don’t incur heavy fees on the transactions.
- Since you are the only one who has access to your electronic wallet, your coins are always safe with you and no one can steal your money. The process and transactions are transparent due to the shared public ledger and anyone can verify a transaction at anytime from anywhere around the world using the internet.
- Another advantage of having a Bitcoin cryptocurrency wallet is that your account cannot be frozen.
Keeping in view the growing popularity and acceptability of Bitcoin cryptocurrency we can safely assume that the future of Bitcoin is not only safe rather quite bright and this innovative payment method is here to stay.
What will the future of money look like? Imagine walking into a restaurant and looking up at the digital menu board at your favorite combo meal. Only, instead of it being priced at $8.99, it’s shown as.009 BTC.
Digital (Crypto) Marketing Future of Money
Can crypto really be the future of money? The answer to that question hinges on the overall consensus on several key decisions ranging from ease 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 first and most important component is trust.
It’s imperative that people 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.”
How does trust work with Bitcoin since it’s decentralized meaning their isn’t a governing body that issues the coins? Bitcoin sits on the blockchain which is basically an online accounting ledger that allows the whole world to view each and every transaction. Each of these transactions is verified by miners (people operating computers on a peer to peer network) to prevent fraud and also ensure that there is no double spending. In exchange for their services of maintaining the integrity of the blockchain, the miners receive a payment for each transaction they verify. Since there are countless miners trying to make money each one checks each others work for errors. This proof of work process is why the blockchain has never been hacked. Essentially, this trust is what gives Bitcoin value.
How to Trust?
Next let’s look at trust’s closest friend, security.
How about if my bank is robbed or there is fraudulent activity on my credit card? My deposits with the bank are covered by 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 pull off stunts that are at the very least frustrating and time consuming. It’s more or less the peace of mind that comes from knowing that I’ll most likely be made whole from any wrongdoing against me.
In crypto, there’s a lot of choices when it comes to where to store your money. It’s imperative to know if transactions are insured for your protection. There are reputable exchanges such as Binance and Coinbase that have a proven track record of righting wrongs for their clients. Just like there are less than reputable banks all over the world, the same is true in crypto.
What happens if I throw a twenty dollar bill into a fire? The same is true for crypto. If I lose my sign in credentials to a certain digital wallet or exchange then I won’t be able to have access to those coins. Again, I can’t stress enough the importance of conducting business with a reputable company.
The next issue is scaling. Currently, this might be the biggest hurdle that’s preventing people 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 only handle around 10 per second. However, a new protocol is being enacted that will skyrocket this up to 60,000 transactions per second. Known as the Lightning Network, it could result in making crypto the future of money.
The conversation wouldn’t be complete without talking about convenience. What do people typically like about the their traditional banking and spending methods? For those who prefer cash, it’s obviously easy to use most of the time. If you’re trying to book a hotel room or a rental car, then you need a credit card. Personally, I use my credit card everywhere I go because of the convenience, security and rewards.
Did you know there are companies out there providing all of this in the crypto space as well? Monaco is now 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 know that process can be very tedious and costly. Blockchain transactions allow for a user to send crypto to anyone in just minutes, regardless of where they live. It’s also considerably cheaper and safer than sending a bank wire.
There are other modern methods for transferring money that exist in both worlds. Take, for example, applications such as Zelle, Venmo and Messenger Pay. These apps are used by millions of millennials everyday. Did you also know that they are starting to incorporate crypto as well?
The Square Cash app now includes Bitcoin and CEO Jack Dorsey said: “Bitcoin, for us, is not stopping at buying and selling. We do believe that this is a transformational technology for our industry, and we want to learn as quickly as possible.”
He added, “Bitcoin offers an opportunity to get more people access to the financial system”.
While it’s clear that fiat spending still dominates the way most of us move money, the fledgling crypto system is quickly gaining ground. The evidence is everywhere. Prior to 2017 it was difficult to find mainstream media coverage. Now nearly every major business news outlet covers Bitcoin. From Forbes to Fidelity, they’re all weighing in with their opinions.
What’s my opinion? Perhaps 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 to their very existence. They stand to be on the losing end of the greatest transfer of wealth the world has ever seen.
Still undecided? Ask yourself this question: “Are people trusting governments and banks more or less with each passing day?”
Your answer to that question just might be what determines the future of money.
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