Can crypto really be the future of money? The answer to that
question hinges on the overall consensus on several key decisions
ranging from ease of use to security and regulations.
Let's examine both sides of the (digital) coin and compare and contrast traditional fiat money with cryptocurrency.
The first and most important component is trust.
It's
imperative that people trust the currency they're using. What gives the
dollar its value? Is it gold? No, the dollar hasn't been backed by gold
since the 1970s. Then what is it that gives the dollar (or any other
fiat currency) value? Some countries' currency is considered more stable
than others. Ultimately, it's people's trust that the issuing
government of that money stands firmly behind it and essentially
guarantees its "value."
How does trust work with Bitcoin since
it's decentralized meaning their isn't a governing body that issues the
coins? Bitcoin sits on the blockchain which is basically an online
accounting ledger that allows the whole world to view each and every
transaction. Each of these transactions is verified by miners (people
operating computers on a peer to peer network) to prevent fraud and also
ensure that there is no double spending. In exchange for their services
of maintaining the integrity of the blockchain, the miners receive a
payment for each transaction they verify. Since there are countless
miners trying to make money each one checks each others work for errors.
This proof of work process is why the blockchain has never been hacked.
Essentially, this trust is what gives Bitcoin value. When you have almost any issues relating to where by along with the best way to work with アフィリエイト, please visit our website.
Next let's look at trust's closest friend, security.
How
about if my bank is robbed or there is fraudulent activity on my credit
card? My deposits with the bank are covered by FDIC insurance. Chances
are my bank will also reverse any charges on my card that I never made.
That doesn't mean that criminals won't be able to pull off stunts that
are at the very least frustrating and time consuming. It's more or less
the peace of mind that comes from knowing that I'll most likely be made
whole from any wrongdoing against me.
In crypto, there's a lot of
choices when it comes to where to store your money. It's imperative to
know if transactions are insured for your protection. There are
reputable exchanges such as Binance and Coinbase that have a proven
track record of righting wrongs for their clients. Just like there are
less than reputable banks all over the world, the same is true in
crypto.
What happens if I throw a twenty dollar bill into a fire?
The same is true for crypto. If I lose my sign in credentials to a
certain digital wallet or exchange then I won't be able to have access
to those coins. Again, I can't stress enough the importance of
conducting business with a reputable company.
The next issue is
scaling. Currently, this might be the biggest hurdle that's preventing
people from conducting more transactions on the blockchain. When it
comes to the speed of transactions, fiat money moves much quicker than
crypto. Visa can handle about 40,000 transactions per second. Under
normal circumstances, the blockchain can only handle around 10 per
second. However, a new protocol is being enacted that will skyrocket
this up to 60,000 transactions per second. Known as the Lightning
Network, it could result in making crypto the future of money.
The
conversation wouldn't be complete without talking about convenience.
What do people typically like about the their traditional banking and
spending methods? For those who prefer cash, it's obviously easy to use
most of the time. If you're trying to book a hotel room or a rental car,
then you need a credit card. Personally, I use my credit card
everywhere I go because of the convenience, security and rewards.
Did
you know there are companies out there providing all of this in the
crypto space as well? Monaco is now issuing Visa logo-ed cards that
automatically convert your digital currency into the local currency for
you.