Steemit Crypto Academy Contest / S2W1 - How Cryptocurrency has Shaped the Financial Realm. What is Its Future? by @lebey1

2개월 전

Introduction

Cryptocurrencies are virtual currencies that use blockchain technology to track transactions through a network of computers. They operate independently of a central bank and are not controlled by governments despite some recently trying to get involved. Cryptocurrency has become more prevalent in recent years, and these days you can use it to buy everything from cars to houses.

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Cryptocurrency is a digital currency that uses blockchain technology. This technology is used to verify and record transactions chronologically, making it difficult for anyone to alter or manipulate the records.
Bitcoin was the first cryptocurrency ever created, and it was created by an anonymous individual named Satoshi Nakamoto in 2009. This currency was to act as an alternative payment method that would circumvent traditional banking institutions and allow individuals to send payments directly to each other without using any middlemen such as banks or credit card companies.

Smart contracts were also introduced during this time period in order to make sure both parties agreed on all terms before any agreements could be made between them (i.e., smart contracts would ensure that neither party could back out once they signed off). Bitcoin became quite popular because it represented freedom from government control over money supply; this allowed people who wanted their wealth out of fiat currencies like USD or EURO into something else where they had complete control over their money supply itself rather than relying on central authorities like governments who might try inflating their currencies beyond what citizens want them inflated by buying more debt than necessary through quantitative easing programs.

Comparison between cryptocurrency and conventional currencies

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When people talk about cryptocurrency, they usually mean digital currency. Cryptocurrency is not the same thing as traditional fiat money. Fiat is a physical currency with no intrinsic value but is backed by government regulation or a central bank. In other words, it's "legal tender." You may have heard stories of how people sold their homes to buy Bitcoin (this did happen!). But if you want to own any cryptocurrency, it's best to think of them as an investment and not spendable money in your pocket—at least not yet!

Regardless of this fact, Cryptocurrency and the traditional (conventional) currency shares some similarities which are:

  • They are both legal tenders: Euro, Dollars, and pounds are legal tenders that have been accepted and backed up by law in some countries. This is also applicable to Bitcoin and some stable coins which have been legally backed to be a legal tender also in some countries. An example of the countries in which cryptocurrencies are accepted as legal tender in El Salvador, Paraguay, Venezuela, etc.

  • Means of payment: Both cryptocurrency and Fiat can be used by an individual to pay for services or products. it is no longer. Cryptocurrencies continue to gain recognition and are now possible to use crypto as a medium of exchange just like the traditional use of paper money. You can use crypto to pay for little things like coffee or a writing service same way the paper money can be used.

Store of Value: Paper money represents value and that's one of the reasons why it remains valuable to its holder. The same applies to cryptocurrency as it's a store of value too. This value is attached to its by the holder and the world at large.

Scarcity: Both traditional and cryptocurrency are difficult to accumulate. It is not something you get for free without doing something for the person giving it out. The only exception is when one gets it as a gift.

Distinctive innovations of cryptocurrency

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Despite the similarities between Cryptocurrency and traditional currency [Paper Money], they are a lot of features that sets Cryptocurrency apart. Cryptocurrency is a digital currency that any government does not control, bank, or single administrator. It's also called crypto because cryptography is used for security. People had to use physical coins and notes to represent money in the past. These physical items were often made of precious metals like gold or silver. Cryptocurrency is an entirely different form of money because it exists only in the digital world and can be transferred between users without going through a financial institution like a bank or credit card company.

What sets cryptocurrency apart from every form of currency will be discussed under the following sub-header that follows:

Perhaps the most significant benefit of cryptocurrencies is that they are decentralized;
What does it mean to be decentralized, and why is that a good thing? Decentralization means a lack of central authority. In the case of cryptocurrencies, there is no one organization or person who can control the currency or its ledger. The same goes for blockchain—no one can control it unless they have 51 percent of all available computing power in the network. This makes it ideal for businesses since there's no single point of failure, which means your business won't lose access to its funds if something happens to you or another employee.

Cryptocurrencies are based on blockchain, an unchangeable, secure ledger:
The blockchain is a decentralized ledger. It's open-source, meaning that anyone can view and contribute to it. It is distributed, so there's no single point of failure or control; multiple copies of the ledger are stored on thousands of computers around the world – this makes it incredibly difficult to tamper with or hack. The blockchain is also peer-to-peer; no intermediaries are required when making transactions using cryptocurrencies like Bitcoin (which is based entirely on this technology). Finally, because these ledgers are maintained by an entire network rather than one central body such as a bank or government agency, they're known collectively as public ledgers.

Breaking the transfer of money barriers and promoting faster transactions:
The good thing with cryptocurrency is that you can send and receive from any corner of the world to other parts of the world without stepping out of your comfort zone or home. Cryptocurrency solves the issues which arise from countries having different fiat as their legal tender. With crypto, you can send money from your own country whose legal tender is Euro to someone in America whose legal tender is Pounds without the need of going through the stress of converting from one currency to another. This, payments are made and received in record time without the need of a middle-man.

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Downsides of Cryptocurrency

Like all technology, Cryptocurrency also has its downsides. This downside is highlighted below and discussed

We can't ignore the fact that some people use cryptocurrency for illegal purposes:

Let's be clear about one thing: cryptocurrency is not anonymous. You cannot spend your digital coins without anyone knowing who you are and where you are sending your money. This is a huge downside for criminals, but it's also just one example of how cryptocurrency is not a tool for crime. Cryptocurrency exists because we need an alternative to fiat currency that governments can't control or manipulate as they see fit, and it's this very freedom that concerns many people. In addition, we can't ignore the fact that some people use cryptocurrency for illegal purposes.

How to solve this: All exchanges should put in place adequate security measures on their system by ensuring that each user creating an account undergoes a KYC (Identify Verification) so as know who and what the owner of the account does not do.

Scam projects setup to steal people's money:

Just like the Ponzi with which is been done for fiat, projects involving the use of crypto can also fall into this category. A lot of projects are set up to fail and in turn, investors lose out without the person in charge of the project facing any legal consequences.

How to solve this: All projects should be properly verified by the blockchain owners and the details of the project owner should be published and confirmed before the project is allowed to be launched.

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Cryptocurrency remains the future

Cryptocurrency is the future of money, and it will be around for a long time to come. Many would agree that cryptocurrency is going to revolutionize the way we transact. It has already proven to do so in many ways. Cryptocurrencies have given us the ability to send and receive payments without an intermediary. Now, with more people learning about blockchain technology, it's likely that cryptocurrencies will become even more commonplace in our society as time goes on. Some of the reasons I believe that cryptocurrency has a great future ahead are the:

  1. it promotes freedom as you are actually in charge of your money
  2. It removes the need for a third party or middle man like Banks
  3. It removes government regulations and it serves as a way to escape Taxes from the Government
  4. It remains a technology with limitless opportunities, the growth of NFT, Metaverse, DeFi, and Web3 is a proof of that
  5. It provides an avenue to make money thereby reducing poverty. an example of people who makes money are traders and even airdrop hunters.
  6. It provides jobs to the masses, thereby reducing the rate of unemployment
  7. Cryptocurrency makes transactions faster

Cryptocurrency presents a new way of doing things. Cryptocurrency is simply ahead of its time; however, it will progress and one day it will be the norm to use this currency for daily transactions.

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Thank you, @lebey1 for publishing an article in the Steemit Crypto Academy community today. We have accessed your article and we present the result of the assessment below.

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Comment/Recommendation

  • You have shallowly talked about cryptocurrency and there are also a few inconsistencies, if we are talking about smart contracts compatibility, it starts from Ethereum and not Bitcoin as you mentioned. In addtion, you have only talked about similarities of both currencies while you totally excluded the differences.

  • The innovations, downsides, and solutions you gave above lacks in-depth analysis. It's very shallow.

  • You have shown your trust in the future of cryptocurrency.

Overall, good try. You should work on your presentation, justify your texts and improve the quality of analysis.

Rating

Total| 6.5/10

You have done well and greatly. You answered all questions in an outstanding way plus your comparison between the conventional currency alongside the cryptocurrency was well detailed and highlighted. There is indeed a bright future for cryptocurrency if certain government will see it importance. A great article man.

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Thanks for the praises. i promise to improve with each written article

Cryptocurrency is the future of money, and it will be around for a long time to come.

Yes you are absolutely right cryptocurrency is the future money. if we invest in it now then we can make a lot of money from it for the future of our childres and for our own future.

Cryptocurrency makes transactions faster

Yes one of the biggest benefit of crypto is that we can send money anywhere at any time with fastest transaction speed.

Thanks for sharing with us your article is very informative....

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thanks for reading in-depth. I appreciate the time you put into this

Nicely explained bro. I do agree with recommendations

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thanks for reading in the first place

I love the simplicity in your explanation of cryptocurrency. I also hope more countries will adopt the use of cryptocurrency as a legal tender in the nearest future. Thank you for this explanations

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my pleasure. Thanks for stopping by

You wrote like a really knowledgeable young youth man.

Scam projects setup to steal people's money

Everyone should be careful not to fall victim into this criminals hand because they are now much online, looking for where the can easily steal your money

You should try to also use this tag

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it will help you properly justify your article making it look awesome.

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Thank you. I just started using it. Thanks for the hint

Cryptocurrency gives users right to control their money a new freedom for all to use a transparent source of making transaction indeed crypto has provided means of generating income for considerable number of users thanks for sharing.

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glad that you like what you read. Thanks

You have said well for indeed cryptocurrencies have shaped the financial realm positively. The increased speed of transaction, privacy and some features are part of its great benefits.

Thank you for taking part in this contest.

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it is my pleasure. i appreciate your opinion