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Can cryptocurrencies finish with the banking system?
Written by Davies on / Reading time: 5 minutes.
To many of you, it may be still a concept almost unknown Others, however, may have already noticed some issues with virtual coins. Whatever it is, the reality that began to take shape since the Bitcoin launch in 2009 have become a revolution of the banking system. Its decentralized nature has opened a world of possibilities. Nowadays, people no longer speak about this type of cryptocurrency, but multiple cryptocurrency that have emerged since then. Litecoin, Ether and Ripple serve as good examples.
But, how are cryptocurrencies changing the way we spend and save our money? How do they allow us to make transactions? Will cryptocurrencies be the perfect opportunity to reform money? Are they becoming the coin of the future?
A reflection of what is happening
The increase commercial exchanges with cryptocurrencies, as well as their increasingly widespread acceptance, have been notable in the past nine years. 2018 has echoed this phenomenon, as some media have already reflected the reality that is emerging through the following headlines:
- CNBC; Bitcoin headed to $100,000 in 2018, says analyst who predicted last year's price rise
- The New York Times; Data Shows Cryptocurrencies and Blockchain Will Continue to Grow
Someone, at some point, dreamed of creating a cryptocurrency that could replace our current financial system. Will it be the virtual currency capable of achieving it?
Today, we want to share with you part of its history. Are you ready?
A history with a conscious taste
It all started with a dream: to create a safe cryptographically currency that could be used as a form of universal money. At the time, the objective was to replace all forms of fiat currencies in the world. Over the years, the openness of the Bitcoin code made possible for people to create their own version, giving rise to new cryptocurrencies.
Technology has much to do whit it and we will tell you why. The world is changing at high speed, which affects, inevitably, to the everyday way in which we carry out our daily activities, the way in which we communicate, the way in which we travel and the way in which we spend our money. Technological innovations do not better or worse our life, but they make it more convenient and more suited to our needs. Perhaps because we are looking for speed, efficiency and safety in everything we do, and to get it, it is only possible thanks to technology.
Few people doubt that this paradigm has been involved in each areas of our life. This post is a clear example of the significant change that are experiencing the ways in which we get money, how we keep it and how we spend it. Some time ago cash was the most popular form of money. Suddenly, our world began to be digitally transformed. Things seemed to be in line and interconnection came to ourselves. As a result, money use has also been transformed.
We do not longer talk about the appearance of PayPal or bank transfers through the phone or the computer. The world, now, goes much further. Virtual currencies have gained special importance in the past nine years. The value of each one of them makes them unique and individual. However, despite the fact that one of the principal objectives that users had in mind has been the buy and sell quickly, its purpose goes beyond. What if we talk to you about a highly usable currency? A currency that can be used for something as common as shopping. A currency that anyone can use to buy whatever they need.
Finding a niche in the global economy is not an easy task, as we have already seen with Bitcoin, when it experienced the first fall in its growth by trying to achieve this goal. The price collapsed and value changed outright, but something diverted its course. Starting in 2012, the world began to become aware of the advantages of using the virtual currency, especially when with the possibility to send money anywhere in the world.
People has been realizing that they can have the total control over their money. They can be the owners, not the banks. Financial crises have also played a fundamental role in this regard, and some, like Greece and Venezuela, have made people want to ensure the protection of its economy, so that they have found a way of achieve it in the cryptocurrencies.
Currently, virtual currency offer transactions from person to person without intermediaries. For this reason, there has emerged a new shared economy. What would happen if companies accept cryptocurrencies as a payment method for their products and services?
Therefore, may cryptocurrencies end up with the banking system?
The answer to this question can only come accompanied by time, but it is true that it is a real concern among the system. However, constant changes and speed and the vertiginous wat in which the world transforms make virtually unpredictable what can happen within ten years. What we know for sure is that millions of people increasingly rely on their mobile phones to manage their money. And we don't mean only to pay, but also to ask for loans.
Cryptocurrencies continue to grow, and its possibilities are increasingly higher. Even at this time, there has already been created a virtual currency that allow to make loans between individuals. The safety of these coins, as well as the integrity and balance of its accounts without intermediaries, have made possible the so-called ‘The Internet of Value’. Central banks have found a clear threat in these virtual currencies. In this way, they have responded and have convinced themselves of acting against cryptocurrencies to ensure that they do not entrench and undermine confidence in the central banks, as stated the Head of the Bank for International Settlements (BIS).
And you, what do you think in this respect?