What will be the future of money? Imagine walking into a restaurant and looking at the digital menu board at your favorite combo meal. Only, instead of being priced at $ 8.99, it is shown as 009 BTC
Can crypto really be the future of money? The answer to this question depends on the overall consensus on various key decisions, from ease of use to safety and regulations.
Let’s examine both aspects of (digital) currency and compare and contrast traditional fiat money with cryptocurrency.
The first and most important element is faith.
It is essential that people believe in the currency they are using. What does the dollar value? Is it gold? No, the dollar has not been supported by gold since the 1970s. So is that what the dollar (or any other fiat currency) values? Currencies of some countries are considered to be more stable than others. Ultimately, it is the belief of the people that the paying government stands firmly behind it and essentially ensures its “value”.
How does trust work with Bitcoin since it is decentralized which means they are not a regulatory body that issues currencies? Bitcoin sits on a blockchain that is basically an online accounting ledger that lets the whole world see every transaction. Each of these transactions is verified by miners (operating a computer on a peer-to-peer network) to prevent fraud and to ensure that no double costs are incurred. In exchange for their services to maintain the integrity of the blockchain, miners pay for every transaction they verify. Since countless miners are trying to make money everyone checks to see if they are working for each other’s faults. This is proof of why the blockchain has never been hacked. Basically, this belief is what makes Bitcoin worthwhile.
Then look at the trust’s closest friend, security.
What if I have a bank robbery or fraudulent activity on my credit card? My bank deposit is under FDIC insurance. Chances are my bank will refund any charges on my card that I never did. This does not mean that criminals will not be able to stop stunts that are at least frustrating and time consuming. It is more or less the peace of mind that comes from knowing that I will probably recover from any wrong done to me.
In crypto, there are many choices about where to save your money. It is important to know if the transactions are insured for your protection There are reputable exchanges like Binance and Coinbase which have proven track record of correcting clients’ mistakes. The same is true of crypto, as there are fewer reputable banks around the world.
What if I threw a twenty dollar bill into the fire? The same is true for crypto. If I lose my sign-in credentials to a certain digital wallet or exchange, I will not be able to access those coins. Again, I can’t stress enough the importance of conducting business with a reputable company.
The next problem is scaling. Currently, this may be the biggest obstacle that prevents people from doing more transactions in the blockchain. When it comes to transaction speed, fiat money goes much faster than crypto. Visa can handle about 40,000 transactions per second. Under normal circumstances, a blockchain can handle about 10 operations per second. However, a new protocol is being developed that will increase to 60,000 transactions per second. Known as the Lightning Network, it could create the future crypto of money.
Conversations will not be complete without talking about benefits. What do people usually like about their traditional banking and spending methods? For those who like cash most of the time it is obviously easy to use. If you are trying to book a hotel room or a rental car, you need a credit card Personally, I use my credit card wherever I go for convenience, security and rewards.
Did you know that there are companies in the crypto space that provide all of this? Monaco is now issuing Visa logo-ad cards that automatically convert your digital currency into local currency.
If you have ever tried to pay someone, you know that the process can be very tedious and expensive. Blockchain transactions allow users to send crypto to anyone, no matter where they are, in just a few minutes. It’s cheaper and more secure than sending a bank wire.
There are other modern methods of money transfer that exist in both worlds. Take, for example, applications like Zelle, Venmo and Messenger Pay. These apps are used by millions of millennia every day. Did you know that they have started to include crypto as well?
The Square Cash app now has Bitcoin, and CEO Jack Dorsey says: “Bitcoin, for us, is not stopping buying and selling. We believe it is a transformative technology for our industry, and we want to learn as soon as possible.”
“Bitcoin allows more people to access the financial system,” he added.
While it is clear that Fiat costs still dominate most of our money transfer systems, the new crypto system is rapidly gaining ground. The evidence is everywhere. Before 2017, mainstream media coverage was hard to find. Bitcoin now covers almost every major business news outlet. From Forbes to Fidelity, they are all weighing in with their opinions.
What is my opinion? Perhaps the biggest reason Bitcoin is successful is because it is fair, inclusive and allows financial access to more people worldwide. Banks and large corporations see this as a threat to their very existence. They are on the verge of losing the transfer of the world’s largest asset.
Still indecisive? Ask yourself this question: “Do people have less faith in government and banks?”
Your answer to this question may be what determines the future of money.