Everyone seems to be obsessed with cryptocurrencies. So why are they important and why does humanity need them when each country has its own regular currency? Well, first and foremost, cryptocurrencies are better than conventional currencies. How? Let’s figure out!
There are four main reasons why cryptocurrencies are better than regular money:
- Full digitalization
- Security
- Decentralization
- Anonymity
Full digitalization
All cryptocurrencies are fully digital. Cryptocoins are basically sequences of code generated by a special algorithm. Creation of cryptocurrencies doesn’t involve any printing or coining machines. It also doesn’t waste any paper and does not rely on any government or a central bank to authorize the issue. All you need to use your cryptocurrency is internet access.
Some might argue that in the 21st century most people tent to keep their money in digital form on their bank accounts and use their plastic cards to pay for the goods.
While it is true, plastic cards are physical objects that can be lost, damaged, stolen, etc. Moreover, plastic is extremely bad for the environment and sooner or later governments will be taking measures to eliminate them.
Owners of cryptocurrency do not risk losing their money due to any of these factors.
Security
Cryptocurrencies are not only physically safe; they are also secure from inflation and third-party interference. Governments and banks can’t freeze your crypto assets or suspend your account.
With cryptocurrencies you remain the sole owner of your funds. Cryptocurrencies can’t be used as an instrument of pressure or punishment, which often happens with regular money.
Financial regulators constantly issue new money, and by doing so they reduce the value of money that already exist. This causes inflation which is the reason why everything becomes more expensive over time. Cryptocurrencies are designed to avoid the risk of inflation.
Decentralization
Most cryptocurrencies are generated using the blockchain technology. Blockchain divides the important information about the cryptocurrency, its numbers, transactions, etc. between millions of users worldwide instead of keeping it in one place. This makes cryptocurrencies resistant to any manipulations or falsifications.
All transactions made with cryptocurrencies are transparent. Blockchain verifies each transaction through the global network of computers making it impossible to fake or hide any fund transfers.
Anonymity
All blockchain participants and cryptocurrency users remain fully anonymous. While all information about the users is encrypted, cryptocurrencies have different approach to anonymity of transactions.
In some blockchains transactions are open to the public and can be viewed by anyone, and the others don’t let any third parties know that there even was a transaction unless both parties agree to publish it.
In addition, you don’t need to give your passport details or other information to anyone to buy, sell or transfer cryptocurrency.
Sure, some cryptocurrency exchanges or payment services may ask for your identity proof, but this is done because of the governmental regulations. You are always free to choose other options and ensure your economic and personal freedom by using the most advance cryptocurrency technologies.