why the cryptocurrency is the future of money
You’ve probably heard of Bitcoin, the most well-known cryptocurrency, but you might be wondering how it’s different from other currencies. While it may not be an official currency backed by the government like USD or GBP, Bitcoin (and other cryptocurrencies) have the potential to drastically change how we think of and use money in our day-to-day lives...
Cryptocurrency is Decentralized
Cryptocurrencies are decentralized, meaning any one person or group does not control them. They're also not controlled by any one government or bank. That's because cryptocurrencies use what's called a blockchain to record transactions. A blockchain is a database that records transactions between two parties in a permanent and secure way, so you can't go back and change anything after it's been recorded. The blockchain is distributed--meaning it exists on multiple computers at the same time--so even if some computers are shut down, as long as others remain operational, everyone will still be able to keep track of all their transactions.
Transactions are Fast and Secure
Cryptocurrency offers a secure and anonymous way to send and receive money. Transactions are fast and can be confirmed in minutes, as opposed to days with traditional systems. Plus, cryptocurrencies have much lower fees than most other forms of payment. For example, Bitcoin only charges 0.0001 BTC (or $0.05) per transaction. That's just a tiny fraction of what many banks charge!
Cryptocurrency is Private
Cryptocurrency is a more private way to make and receive payments. With cryptocurrency, you are your own bank and in charge of your assets. All transactions are recorded on a public ledger, which records all transactions in chronological order. However, not much information about the transaction is shared other than the time it occurred and who sent and received it. This helps prevent identity theft since no personal information is tied to any transaction or address.
Cryptocurrency is Immutable
Cryptocurrency is a digital or virtual currency that uses cryptography for security. It is not issued by any central authority and relies on decentralization to prevent fraud.
While some cryptocurrencies are backed by real-world commodities, like gold and silver, most of them aren’t which means there is no way for governments to influence the price. The value of cryptocurrencies is determined solely by supply and demand – when more people want it, the price goes up.
Cryptocurrencies cannot be inflated or deflated at will because they don't rely on a central bank's monetary policies. This makes it difficult for the government to manipulate how citizens spend their money.
Cryptocurrencies Have Real-World Applications
Cryptocurrencies are a type of digital currency that utilizes cryptography to secure transactions and regulate their generation. Unlike fiat currencies, they are not regulated by a central bank. The most famous cryptocurrency today is Bitcoin, but Ethereum and Litecoin are also popular alternatives.