While crypto may have become the buzzword today much remains to be unearthed about this technology. As expected, there are many worries and controversies centering on cryptocurrencies and the technology that has the power to disrupt traditional monetary systems. According to crypto advocates, these digital financial platforms are trustless systems. They are not tied to any government, financial body, or nation state. This makes cryptos superior to traditional monetary currencies.
Cryptos came about in 2009 when the first digital coin was launched. The Bitcoin was founded on the blockchain technology and was designed to facilitate financial transactions without middlemen like banks or financial institutions. Those who were willing to take their chances with the Bitcoin have now become millionaires.
The cryptos have been on a rollercoaster ride no doubt, but Bitcoin prices have continues to climb up. Despite the extreme market volatility, Bitcoin prices seemed to be skyrocketing. Soon after its launch, cryptos like the Ethereum, Ripple, and Litecoin have appeared. Now, it is hard to imagine a future without these coins. Did you know there are greater than 2000 listed cryptos? Today, large companies and central banks are also toying with the idea of creating their own cryptos.
What does the future of cryptocurrency look like?
Since cryptos have the potency to redefine the way we transfer money across borders, they have become a much-debated topic and a challenge for traditional financial systems. One of the main reasons for the unimaginable growth in cryptocurrency popularity had been the deficiencies in the traditional monetary systems. After the 2008 economic crisis worldwide, both financial services and consumers were keen for new methods to make transactions more transparent and efficient. Another factor responsible for the popularity of cryptos was that the transfer fees were much lower than what consumers had to pay earlier. So, cryptos will continue to reshape the monetary system worldwide.
Whether it is successful as a payment system or asset will depend on how well the technology evolves, its adoption by businesses, increase in consumer demands, and how the regulatory bodies respond.
Since cryptos are hard to understand people tend to be intimidated by them. This is especially true of people who are not tech-savvy. But the extensive adoption of cryptos as a method of payment will help in overcoming both regulatory and technical problems that they are now facing.
Since not much is known about cryptos and no regulatory body for them, they are still held as speculative assets. In short they are not recommended for individual investors. So, it is important to address issues like complete absence of a central power to back a crypto’s value. Once regulations are introduced, transactions will become smoother and this money revolution will be deemed successful.
The biggest challenge for the cryptos is that they have to be adopted without compromising user anonymity or becoming a tool for evading taxes and laundering money. This means cryptos will need to integrate features to avoid hacks and frauds. At the same time, it must be easy-to-navigate so that consumers are not afraid to dabble with it. If we look at these things, we can conclude that the retail, ecommerce, and trade sectors have the biggest potential to help cryptos evolve. Cryptos can become the best option for digital payments because they can change the way in which cross-border transactions are done.
