5 Ways Digital Currencies Are Transforming the Future of Money
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The future of money is indeed digital, with fiats being replaced by cryptocurrencies. They have launched a new era that is blazing fast and getting more innovative every day.
Some of the most popular digital currencies include Bitcoin, Ethereum, Litecoin and Ripple. The value of digital currency has been on a rise as global interest in these coins continues to grow exponentially.
In the long run, you can imagine governments allowing their citizens to use digital currencies as a way of reducing tax collection and growing the economy through better banking practices. On the opposite end of the spectrum, they could also enforce a trade ban on cryptocurrency trading due to its anonymity during transactions which is illegal under international law – or because it is being used for illegal activities such as money laundering.
The introduction of digital currencies is trending, nearly half of all people around the world are now familiar with digital currencies, even Bitcoin mining, according to a market research study by cryptocurrency watcher Statista. But there’s more. Here are five ways digital currencies transform the future of money, by Scott Robinson, an expert in these technologies and author of “Understanding Digital Currencies”
1. You Can Use Them Anywhere.
You don’t have to worry about banks, transaction fees, or fraud. And you can take a vacation across the world and pay for everything with digital currency.
Digital currencies are a type of electronic money that is designed to be secure and anonymous. They use cryptography so only those paying the transactions know who they are sending money to, as well as how much they’re sending.
While they can be traded for fiat currency, they are also increasingly being used to purchase things electronically. Digital currency is the ultimate e-commerce currency.
2. They’re Fast and Easy to Use (and You Don’t Need to Carry Cash).
They’ve helped to push the financial economy into uncharted territory. They’re so discretionary and accessible that it’s even hard to grasp how commonplace they’ve become. Digital currencies like Bitcoin and Ethereum have proven themselves as an effective investment tool over the last few years and are only continuing to grow in popularity. They can change everything, including your personal finances. However, you’ll need a fundamental understanding of their impact on society before you jump into this big world of digital currency right now.
3. They Can be Used for Micropayments (Payments Less Than 5 USD).
Currently, the average credit card transaction carries a 3% fee, which when multiplied by billions of transactions is an enormous sum. Digital currencies can be transferred without these fees and are infinitely divisible.
Digital currencies are not backed by any nation; they are decentralized and run on blockchain technology.
Blockchain technology is what many people associate with cryptocurrency (someone’s digital wallet) but it also powers transactions like sending cryptocurrency or even purchasing things in shops without using coin cashiers. Blockchain is designed to be completely secure and tamper-proof; hackers cannot manipulate this type of system in any way whatsoever because it relies on millions of computers all over the world to “verify” every transaction that takes place. It also can’t be censored because it is decentralized and relies on the internet
4. You Can Transfer Them Globally at Minimal or No Cost.
You can transfer Digital currencies globally at minimal or no cost. They are borderless, enabling person-to-person transactions with near-zero transaction costs. Digital currencies provide a unique opportunity for active participation in the global monetary system by equally empowering every community member who wishes to participate in economic activities regardless of geographical, political, or institutional boundaries. Digital currencies have also created opportunities for consumers globally to manage their money with greater freedom and efficiency through digital wallets that replace conventional bank accounts. The most important lesson that can be gleaned from this diverse array of developments is that the future of money is about more than shiny coins. It’s about people coming together in unique ways to create new economic models with unique digital properties built around global communities.
5. The Level of Security
Digital Currencies are secure, easy to use, and incredibly efficient. In fact, they are the future of money as we know it. This is because digital currencies provide a platform where people can purchase goods and services without the need for a third-party bank or financial institution. Digital currencies also allow people to instantly send value to anyone in exchange for a crypto token that operates on a blockchain network. The possibilities for this world of decentralized currency are endless as opposed to traditional fiat currency – which holds no value outside of what central banks currently say it has.
Final Thoughts
With digital currencies, there are no more exchange rates or credit card fees of 5%. And sending money overseas takes just a few minutes. More than USD 1 billion has been raised so far using blockchain technology.
Within the next few years, you’ll be able to use your digital wallet to pay online or in-store, to pay bills, and transfer money internationally. It will be just like carrying cash today, only safer and more convenient, with instant global access.
