Today is the era of decentralized finance also called Defi in lingo terms. As new technologies emerge they aim to disrupt the old establishments and set new norms in place with the goal of better serving humanity and solving complex human problems of today’s day and age with new tech.
What is Cryptocurrency / Cryptocurrency – all about it
First of all, let me tell you, Cryptocurrency is a digital currency. It follows a decentralized system that eliminates the need for traditional intermediaries that used to exist prior to cryptocurrency coming into the picture such as banks, and financial institutions when transferring funds between two parties or entities.
Cryptocurrency is the new buzzword in today’s world. It has emerged as a non-traditional asset class in which everyone wants to get in and make some easy money. But, it’s not just a medium or tool to make a quick buck by investing or trading into it. It’s said to be the next revolution in the field of money and how transactions happen all around the world.
How does cryptocurrency work?
- Cryptocurrency doesn’t exist like any physical form of money ( like paper money ) and it’s not typically issued by a central authority.
- Unlike traditional banks, records for who owns how many coins are stored with a digital ledger where there is a Computerised database that with the help of strong cryptography secures transaction records.
- Cryptocurrency is run by a decentralized way of control and is not like central bank digital currency ( CBDC ), which is considered the main advantage of a cryptocurrency over others.
Blockchain
- What is the central and special about bitcoin and other cryptocurrencies that make it unique, its blockchain?
- Blockchain is a growing list of records, called blocks which are linked and secured using cryptography.
- There are blocks generated that should be verified by each node before being confirmed, this makes it nearly impossible to forge transaction histories.
- It’s like an online ledger or connected blocks, this is essentially what blockchain is.
Interesting Facts of Cryptocurrency
- “Bitcoin is an official currency” in El Salvador and also in the Central African Republic.
- Crypto transactions are banned / illegal in China.
- Pay close attention to upcoming trends in the field of crypto assets:
- Regulations could change the entire game, in the US, India, and abroad.
- Mass adoption of cryptocurrency payments in the future could be next.
- You could see ETFs based on Bitcoin and other digital currencies.
- Countries could come up with bitcoin or other cryptocurrencies as becoming legal tender.
Past, Present, and future of crypto assets
Cryptocurrency has only one direction to go and that is up, Analysts expectations are in line with this theory as they predict by 2030, combined market capitalization for crypto assets is going to triple. Hitting a whopping valuation of $ 5 billion.
It was often for only the anti-establishment investors and extreme communities to invest in crypto assets but, in 2022 it’s quickly becoming a household name.
Whether investors are willing or not, businesses and brands might also like it otherwise, but it’s slowly on the rise and might be the future of currency. “You can’t boycott crypto assets once it becomes mainstream” is what expert says.
Unbiased truth about the future of Crypto
Cryptocurrency is at a young stage and evolving as anybody would expect out of a budding and growing new technology. It can be said, right now is the time of paradox, which is anywhere you look at for cryptocurrency. Investors worry about regulations, they support them in a way. Regulations are in the grey area and can’t be said to have cleared out the fog ahead of it.
“It could become potentially anything, it could be the future of money or not. Anything is possible in the coming future for cryptocurrency”
Key takeaways
- A cryptocurrency is a digital asset, Decentralised structure allows it to exist beyond the control of any government or regulatory central authority.
- The future of blockchain is bright, experts say it will disrupt many industries like finance, law, supply chain, online voting, crowdfunding, etc.
- CBDCs ( Centrally backed digital currencies ) could be the future, which use blockchain technology and experts say it could make digital currency a reality.
- The advantages of cryptocurrency are, it is cheaper, faster, and more efficient for money transfers. Further decentralization makes it an added advantage as no single point of failure could hamper the system.
- Disadvantages include, price volatility makes it not ideal for use as regular, daily use currency. It also has high energy and carbon footprint, which makes it a pollution-causing. It’s criticised often for use in criminal activities.
