CRYPTOCURRENCY AND CONVENTIONAL FINANCIAL SYSTEM

: this derived its name of Fiat Money, there are currencies that are issued by the government for instance, the Italian one and then controlled by a central authority the Bank of Italy and, more recently, the ECB.

When we talk of ordinary currencies, the reference is also to legal tender coins which can be physical coins and banknotes but also on credit, as is the case for payments with various credit cards.

CRYPTOCURRENCIES

CRYPTOCURRENCIES: A cryptocurrency is a decentralized and computer-generated currency that is not controlled by governments or central banks. Virtual assets that use cryptographic technology to process secure and verify transactions.

After cryptocurrency has entered people's field of vision, many people put their financial management hopes on cryptocurrency. So what is the difference between conventional financial methods and cryptocurrency investment?

Investment and financial management generally depends on many situations. For example, most people choose conventional financial methods and are not really interested in the cryptocurrency market.

Then through this article, let’s analyze the traditional financial management and the current market. What is the difference between the most popular cryptocurrency investments on the Internet.

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WHY IS DECENTRALISED NEEDED?

The decentralization of the ownership of cryptocurrency assets has also been used to create a way to access different asset classes without trusting a third party, that is, encrypted synthetic assets.

Synthetic assets use a combination of different assets to simulate the required assets, so investors can benefit from holding asset classes without actually holding them.

Stablecoins are the most well-known example of synthetic assets in decentralized finance. They allow traders to avoid the risks posed by more unstable crypto assets by taking advantage of the relative stability of fiat currencies.

WHAT AFFECT THE VALUE OF CRYPTO CURRENCY?

There are many factors that affects the value of cryptocurrency.Some of which include:

1.They are very volatile : unexpected changes in market sentiment can lead to sharp and sudden changes in prices. It is not uncommon for the value of cryptocurrencies to drop rapidly by hundreds or even thousands of dollars.

The volatility is very alarming lately as it has make some investors feel depression and also begon to regret why they invested in the first place

2.They are not regulated : Cryptocurrencies are currently not regulated by governments and central banks.this has made some individual have a negative idea about not because of the high rate of cyber crimes in the world especially in some countries. For example, it is questionable whether to classify them as commodities or virtual currencies

3.They are prone to errors and hacking : there is no perfect way to prevent technical failure, human error, or hacking.

4.They may be affected by forks or interruptions : cryptocurrency transactions bring additional risks, such as hard forks or interruptions. Before trading these products, you should be familiar with these risks. When a hard fork occurs, the price fluctuation range may be large. If we do not have a reliable base market price, trading may be suspended

The operation of Bitcoin and its price valuation are not subject to the supervision and influence of the central bank. On the contrary, Bitcoin is based on a decentralized platform, which continuously maintains the blockchain ledger through the computing power provided by independent miners on the platform. The central bank uses a series of tools (such as interest rates and bonds) to regulate inflation, and cryptocurrencies including Ripple XRP, Ethereum and even Bitcoin are also affected by the open market.

Bitcoin maintains its value through protocol systems, hard forks, halving events, etc., and is affected by external factors. Bitcoin CFD traders should consider all influencing factors before entering the market

Why everyone cannot become a miner?

There are many reasons why everyone can't be a miner tlbut the most well known reason is due to it volatility.

Imagine an individual mining for over a year now and due to the current state of Bitcoin which has been decreasing effortlessly that individual might not be a lble to have patience or endure this kind of situation as he gave been mining for over a year,This might lead to depression and other related cases .

The fact that it has not been regulated by all country has also made most people to be far away from it

Why can cryptocurrency transactions be called more transparent?

Crypto currency Transaction is an opaque transaction because it does not involve a third party which could monitor the transaction incase of any default which is why it cannot be a more transparent as it is.

Crypto in Nigeria

Cryptocurrency has a made a huge development and contribution to Nigeria as it has made some unemployed youth to get themselves employed and also in some ways reduce the level of poverty .
Though they might have been some side effects has well as some of those who make more money in the platform find it hard to help or support their loved ones to also get involved in it
Conclusively, cryptocurrency s the future virtual currency has it all make the world have a general currency to use in their various transaction which will make other countries become wealthier and also the citizens of the countries as well