Is Cryptocurrency the Next Big Thing?
Cryptocurrency, a subset of digital currencies, have been around since the 90’s, maybe longer. With many computer wizards once trading the currencies on backend platforms, it took until now for the currency to gain widespread attention through the market. Not having to pass hands, these virtual “coins” are farmed, harvested and then traded with others. Purchasing something with cryptocurrency is currently not unheard of, with many businesses offering payment options in cryptocurrency for those customers that shop with them.
In the Past
Previously stated by bank representatives on the matter of cryptocurrency, the adoption of this currency pose a significant challenge to many banks’ abilities to influence the price of credit for the entire economy, as a whole. This led to many challenges for the banks that were trying to find ways to make cryptocurrency worth keeping within their systems. However, with no set value on the coins, as well as an ever-changing worth, it made keeping track and holding onto the coins harder.
As trade becomes more popular with these currencies, the banks that would like to participate have to come up with new systems. As cryptocurrencies popularity rises, the consumer confidence in fiat currencies falls. The dollar bill, backed by the government, is not going to have enough trust in it to be used, as everyone will be using the cryptocurrencies instead.
Additionally, widespread use of these cryptocurrencies is going to make it more difficult for any agencies collecting statistical data to do so on any or all of the economic activities that are happening. This data is often used by the government to shift the economy in the right direction. This could pose a new challenge. These challenges can change the way that important functions are controlled through banks of monetary rate policies and documentation.
While, some countries have outlawed the use of cryptocurrencies, a new outlook is approaching with the rise in technological advancements. Some states have already seen in a rise in adaptation to this new currency.
Take Austin, Texas for starters. Jordan Kelley, the founder of Robocoin successfully launched the first bitcoin ATM back in 2014. It reads the user’s government issued ID to confirm identity and provide the cryptocurrency to them in fiat currency.
With this advancement, other areas started to keep up and by the end of 2017, over 1,500 cryptocurrency ATMs were installed and used throughout the country. On average, 3 ATMs were being installed per day throughout 2017.
Furthermore, this currency is also being used to fund donations for those suffering from natural disasters across the world, as well as Olympic teams. This currency is a viable choice in conjunction with the fiat currency being used.
However, with many advancements that still need to be made, theft continues to be a large factor that has yet to be placed under control. Due to the fact that cryptocurrency is being used as regular currency can be used – to purchase goods and services, it still falls under the jurisdiction of securities fraud. Anyone that uses the currency in an unlawful manner, or takes what is not theirs, are subject to a hearing and can even serve jail time, as the currency is being deemed as a form of money.
Is Cryptocurrency the Next Big Thing?
Many fear that the normal dollar and coin will be outdated in just a few years time with the use of cryptocurrency on the rise. Due to this, new platforms and informational learning materials are out there for those that want to keep up on the changing times and currencies that go with them.
The steady growth of the currency has only shown the world how lucrative the currency type is and ensures that fiat currencies can easily be replaced with something else, even if it is not able to be seen by the naked eye.
Cryptocurrency still has quite a ways to go in order to be deemed fully monetary, due to the fact that it is still an unsecured type of currency but with many advancements that have already been made for the currency, it is more than likely going to boost the use and popularity of the currency as a whole. With many banks now considering the currency and holding it, as well as ATMs and other financial institutions, the future of cryptocurrency is looking up.
Ernest Miller is a research analyst for Investment Talk. He has built his career as a banking officer and later on a financial advisor. Now, he is focusing primarily on blockchain and cryptocurrency, but here you will also find his texts on the traditional economy, as well as analyses of stocks and investments.