While it is often associated with cryptocurrencies, blockchain technology has the potential to be so much more than just a decentralized ledger for cryptocurrency transactions.
Decentralized systems promote transparency in business and finance, which means that blockchain technology could help eliminate corruption in governments and industries across the world.
What is a cryptocurrency?
Cryptocurrencies are fast, secure, and have minimal transaction fees. They’re also decentralized. International transactions that require institutions to work together are held together by middlemen who take a portion of the transaction for themselves. Cryptocurrency transactions are direct peer-to-peer; no outside institutions are involved or required.
This makes cryptocurrencies faster and cheaper than sending money over traditional financial channels, like SWIFT.
What is the purpose of cryptocurrencies?
Financial companies have long been the center of the global financial system. But when banks collapsed in 2008, many people became distrustful of financial institutions. They wanted to do business with each other without the expensive, time-consuming oversight of intermediaries. We all remember how difficult it was to transfer money abroad to people we cared about before Bitcoin was invented. Cryptocurrencies were created to solve this problem.
International trade is often associated with high transaction fees, significant currency exchange rates, and other inconveniences. However, cryptocurrencies are a revolutionary solution to the problem. Their decentralized nature makes them accessible all over the world, not just in major economic hubs. Their high liquidity also allows for fast transfer of funds across borders, supporting international trade. The cryptocurrency market offers many opportunities that could be grabbed.
Opportunities for developing countries
Making money is difficult in developing countries, where corruption and instability are rampant. But investing in cryptocurrencies is a solid alternative. As more people from around the world buy cryptocurrency, the market will remain stable and profitable — letting you earn a decent profit without leaving your home country.
A solid investment for your savings account
According to Marketwatch, the inflation rate in the US hasn’t been so high since the 2008 crisis. Inflation is a serious threat to people’s purchasing power, and it’s a significant factor in the slow growth of the global economy. While regular savings accounts rarely offer interest rates high enough to keep up with inflation, investors can seek out high-interest cryptocurrency accounts to combat the issue. BlockFi is a platform where investors can earn up to 8% APY.
When it comes to cryptocurrency investment, there are many opportunities for people to choose from. However, not all of these opportunities are great. Some cryptocurrency projects are too risky to invest in, as they have no market-proven value. Other cryptocurrencies are worth the attention of investors because they have established themselves as being valuable, reliable investments.
Bitcoin is the original cryptocurrency, the first to use blockchain technology. With its strength and resilience against competitors, Bitcoin has shown itself to be an investment that can’t be beaten. Since 2009, when Bitcoin was created, it has made many investors millionaires. The revolutionary blockchain technology behind Bitcoin is here to stay, revolutionizing the way we think about money.
Ethereum is the biggest altcoin with a market cap of over $390 billion. Where other digital currencies have failed, Ethereum has succeeded by building a blockchain that can be used to build decentralized applications. While most digital currencies focus on being a currency, Ethereum’s team is focused on the growth and development of smart contracts and distributed applications.
Originally created as a joke, Dogecoin became a cryptocurrency hit in January 2021 when attention from Reddit users caused its value to increase exponentially by 800% in just 24 hours. Created by Billy Markus and Jackson Palmer, the currency was initially designed to reach a broader demographic than Bitcoin by combining Litecoin and Luckycoin core code with the iconic Shibu Inu dog seen in the Doge meme. Nowadays, Dogecoin is a subject of interest for many investors who want to buy Dogecoin for many purposes.
What is the crypto future?
While analysts predicted doom and gloom for the cryptocurrency industry, many digital assets have emerged as top performers. Bitcoin, one of the industry’s most resilient assets, has held its value over time, while Ethereum has grown stronger than ever thanks to a steady ecosystem of developers. Some projects have fallen by the wayside, but others have demonstrated their potential to achieve serious goals in the future.
Cryptocurrencies are designed to be complementary to real-world currencies, not competitors. While they may not replace the dollar in the near future, their presence is expected to alter the way we spend, save, and invest money for decades to come.