Cryptocurrency much like a traditional currency determining the value of it and electronic cash is a bit tricky. Its best use can be made to make online payments easier. But the main question arises here that what it really is and what is the future of it and if you came to this article searching for the same question than you came at the right place. Ican understand why so many within the global business, legal and political environments are struggling with this concept.
Let us understand it by having a simpler example of the U.S. dollar, it has its value determined by the exchange rate, treasury notes and measurement against foreign exchange reserves. As Joe Weisenthal explains in Business Insider, the dollar has “intrinsic value” because it’s the only currency that the government accepts, and from the very traditional days it is used for the commerce. Similarly, gold has intrinsic value because it can be used for jewelry.
So, cryptocurrency in simpler words means a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank (Source:Google).
Till now you must be cleared with the term cryptocurrency, still if you have any doubt feel free to comment below on this post. Now, if we are talking abut this term then how can we forget about the popular cryptocurrency -BitCoin that is widely used over the world.
If we look deeper in the past year and a half, Bitcoin has been on a spectacular rise, rising in value from 140% in 2016 and now an additional 49% in just the past month. This makes it a more credible currency, that it is a sign of the cryptocurrency’s strength. But as it goes without saying that any coin has its two sides so here also BitCoin has its disadvantages as well
- Its value is UNSTABLE.
- Transaction processing is too SLOW.
The most important aspect of a currency is to be its stability which is not the ase with this so in near future as well noone can predict the stability of it.
So as we can still see from the popularity of Bitcoin, those limited uses still have quite a bit of value to a nontrivial number of people. I have no objection to these people’s use of Bitcoin for those purposes. However, one should stop expecting it to become a currency that ordinary people use for ordinary transactions. It is destined to stay in its niche as a way to hide things or speculate. A currency, Bitcoin is not, nor shall it be.
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