IS CRYPTOCURRENCY THE FUTURE OF FINANCIAL SYSTEM?
A cryptocurrency is a digital currency that’s created and managed through the help of advanced encryption and stored in a digital ledger or computerized database using cryptography. The word “crypto” comes from secret – and here it means anonymity. Depending upon the configuration, the implemented technology ensures partial or full anonymity.
Cryptography technology is used for many purposes. Like, for securing various transactions happening on a particular network, for controlling the generation of a new currency, and also for verification of the transfer of digital currency.
Cryptocurrencies use cryptography techniques and encryptions to imitate the use of real-life signature by creating safety keys. Cryptography methods use advanced mathematical codes to store and send data in a very secure format that makes sure that only the concerned audience can read and process the data, and also ensures the credibility of the transaction along with the participants.
Bitcoin came up in 2009, and cryptocurrency being an academic thought, went to become a reality. While Bitcoin attracted a lot of audiences, it also captured important capitalist and media attention once it peaked at a record of $266 per bitcoin. Bitcoin had a market price of over $2 billion at its peak, but then the big fall sparked a raging debate on the long term usage and value of cryptocurrencies.
As the initial rise of cryptocurrency seemed a lot more stable, we can make a few predictions about where this is all heading and how it might impact the market in the long term. Blockchain will play a huge role in the development of both public and private sectors in the coming time, but today, let us look at some expected trends in the future of this out of the box concept-
- Accepted and proclaimed: From enterprises to governments, cryptocurrency has grown to become a legitimate form of exchange in several parts of the globe. Not only does this drop much of the administrative trouble, but it also becomes a global standard dependent on exchanges, which boosts both outreach and accessibility. This will expand international trade and make it a lot faster and effective.
- Replace Existing System: It’s predicted that by the time we reach 2030, cryptocurrency would seize around 25% of the market. For many financial entities, national currencies will become less popular and many of them would disappear, particularly in regions engaged in continuous trade. And with the advancement in blockchain technology, the volume of digital commodities will shoot up.
- Volatile in nature: The flow of transactions and investments plays a huge role in determining the values of various cryptocurrencies. While they are not as volatile as before, they will continue to fluctuate due to little or no jurisdiction over its regulation. This has made it attractive to investors who want to engage in peer to peer communications in the future.
- Curiosity: As the industry is going forward, the knowledge base is expanding as folks are trying to find fresh opportunities. Cryptocurrency has attracted the attention of many, and its courses can get widespread in the future for people to learn and understand its functioning.
- The conflict between anonymity and regulation: This is a matter of great concern as Bitcoin is one of the major players in the crypto world and it follows a decentralized approach, which means it has no physical presence and is not backed by any central authority. It frees the investors from being obligated to those institutions, but this could additionally give rise to some real legal complications.
The rise of Bitcoin has established a debate about its future and that of other cryptocurrencies. Despite Bitcoin’s recent complications, its success since its 2009 launch has inspired the creation of different cryptocurrencies such as Etherium, Litecoin, and Ripple. A cryptocurrency that satisfies the diverse criteria only could aspire to become a mainstream financial system. While that possibility looks remote, Bitcoin’s success or failure in dealing with the challenges may indeed determine the fortunes of other cryptocurrencies in the years ahead.
Edited and Supervised by
Siddharth Dalmia
+919971799250
Dalmiasiddharth1994@gmail.com
Written By
Sarthak Nagpal
Email: sarthaknagpal20@gmail.com
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