This article analyses the current world of finance and how the digital currencies are on the track to revolutionise it.
The world has entered the financial technology age, and the wider acceptance and usage of bitcoin and other crypto has had a significant impact on the global financial system.
Analysts suggest that central banks haven’t yet accepted cryptocurrencies due to its underlying threat to the agendas of the government and the fiat currencies. However, the digital currencies and its technology is legitimate and, thus, people and organisations are increasingly shifting from conventional procedures to making payments through digital currencies because of the relatively greater convenience and speed they provide.
Will local fiat currencies be replaced with BTC?
Several questions are being asked in the world of finance which include; are the fiat currencies on the way to become obsolete? Will the domestic currencies of nations be replaced with cryptocurrencies like the BTC?
Different investors and critics have been raising these questions. The investors have been concerned regarding the value of these cryptocurrencies in the long term, and are also worried about the return they earn on these digital currencies, given their volatility patterns. To demonstrate this concern, we can look at the price patterns of the bitcoin, which increased by a factor of greater than 140% during 2020, but fell by more than 50% during 2017, when it was compared against paper currencies like the USD.
Nonetheless, paper currencies are still widely used throughout the world and are a more common mode of exchange, especially in the rural and developing parts of the world.
The cryptocurrencies offer convenience, a fast payment method and ease at a relatively lesser cost. You can send or transfer and receive international payments in cryptocurrency in a matter of minutes or hours, as compared to the other conventional methods which generally take days. Another key feature which makes digital currencies superior is that they are free from any governmental or regulatory authority’s intervention.
The digital revolution
A few skeptics debate that cryptocurrencies are not that convenient and simple to adapt by everyday users. Although this might have sounded true in the early days of cryptocurrency, mainly 2008 when BTC was invented, but given the rapid speed that digital currencies have transformed over the time, this is not completely true now.
An issue was recognised by the cofounders of Ternio, a financial tech platform, in 2017, which was affecting the BTC and other cryptocurrencies in the market. This issue that they observed was that all this Crypto Engine trading app for BTC and other digital currencies was being done on the internet, through exchanges. In other words, there was not much use in other day to day transactions or liquidation like other financial assets for these digital currencies. The investors were to just trade them online and speculate on their prices in the future.
In order to cater this problem, the organisation introduced Ternio and its product, BlockCard, a cryptocurrency debit card, which allowed the users to use their cryptocurrencies like BTC for their everyday transactions. In comparison to searching for the specific business and stores which used these cryptocurrencies, this became a relatively simpler option.
The organisation witnessed instant success. Ternio’s platform, currently links traditional businesses and other financial systems with blockchain infrastructure providing more usefulness to digital assets.
The beginning of a new era in payment innovation
Highlighted by the success of Ternio, cryptocurrencies are really revolutionising payments via instant remittance and the transmission of value on blockchain, which easily defeats the limits and boundaries drawn by the current financial system. This can also be seen as most of the major names like Microsoft etcetera are also moving towards this mechanism, as reported by BBC.
In general, cryptocurrency has different meanings for different people. While it is seen as a financially rewarding asset by some, others consider it to a value hub. It provides an autonomy to the people who use it and also gives them freedom in the market. We believe that although its start has been slower, similar to the beginning of the digital age through internet, the use of digital currencies will pick its pace rapidly to become the leading method in the future of global finance.
Leave a Comment