Today’s world is developing faster every day in terms of technology, and digitization and modern technology development are processes that affect the global economy. Further digitization in the future has the potential to change international competitiveness in the entire world economy, and thus the material prosperity of people. One important innovation in the global economy, made possible by development and digitization, is the emergence of digital money.
Digitization and the Global Economy
Cryptocurrency is contributing to the evolution of the financial and technology infrastructure that is accessible, open source, and global to all who can access the internet, irrespective of their ethnicity, nationality, gender, socioeconomic status, or race.
The Emergence of Digital Money
Cryptocurrencies have traditionally been deemed speculative and risky due to their use in the dark web and for cybercrime, sometimes cases of the victimization of uninformed consumers and the negative effects of mining on the environment.
Challenges and Perceptions of Cryptocurrencies
There is not enough written or said about how this new move in financial experimentation in the crypto economy is producing programmable, tangible modular solutions aimed at storing value, enabling lending, peer-to-peer micropayments, making markets, discovering prices, and margin and collateralizing.
Using simple to set-up and low-cost automated financial services at scale, millions of people today are testing these automated financial technologies in real life with billions of dollars. These technologies may lead to the financial inclusion of billions of underbanked and unbanked people tomorrow with simple and cost-effective automated financial services.
Building an Open and Global Financial System
Perhaps even more important, not enough is being done to ensure that this technological and societal phenomenon achieves its goal – not many of us are taking on the work of establishing an open and global financial system, even though it was invented more than a decade ago and has been growing and evolving in plain sight.
Financial inclusion is a process that ensures that over 1.7 billion people who remain unbanked or underbanked have easy access to useful and affordable financial products and services and many agree. It is estimated that the growing use of digital finance services on the internet, mobile phones, or credit cards will increase the yearly GDP of growing economies by 3.7 trillion dollars including two-thirds of the increase rising from increased profitability of both non-financial and financial businesses and governments, and the remaining one-third from increased investment from financial inclusion for different sizes of business. Using digital finance to create a broader range of jobs could increase GDP of 95 million.
In the past, governments, banks, and institutions have sponsored financial inclusion efforts. Due to the rise in interest in open source technology development based on community consensus, along with blockchain networks, cryptocurrency, and protocols investment, it appears that a grassroots effort to construct a technological infrastructure of the inclusive and alternative open financial system is already to take shape.
Participating in the Cryptocurrency Network
Participation in a cryptocurrency network is not limited to purchasing or selling cryptocurrencies, so anyone reading this article with internet access can get started today. The primary role of participation is staking, voting, and watching transactions use a block explorer while mining transactions and operating nodes to ensure the decentralization and security of a crypto blockchain network.
Trading Cryptocurrency Assets
Furthermore, the crypto industry allows participants to trade their assets. Many sites are available to help with this, including quantum-ai.io. Users can find tips that can help in boosting the chances of successful trade.
There are different views on digital money. The optimistic view of the use of cryptocurrencies is supported by the fact that they facilitate the transfer of funds between two parties in a transaction; these transactions are facilitated using public and private keys for security purposes. These fund transfers are done with minimal processing fees, allowing users to avoid the hefty fees charged by most banks.
Advantages and Disadvantages of Cryptocurrencies
On the other hand, strong instability and volatility appear as the two biggest disadvantages. The fall and rise in the value of Bitcoin directly depends on the statements of various countries and economic leaders, as we know from the example of Elon Musks tweet from 2021, after which the value of Bitcoin increased significantly.
Payment with cryptocurrencies is already possible in several countries and they are becoming more and more recognized in the world, but financial regulators and governments of all countries will have to think carefully about the challenges of their regulation in the future and finally pass certain laws that prevent manipulation and monopoly of the market.
What many people are interested in is which currencies are worth investing in, because the synonym for cryptocurrencies is mainly Bitcoin. Yes, Bitcoin is the currency with the highest value, but that does not mean that others are negligible. Ethereum, Litecoin, Ripple, and Tether are just a few of the many worthy of attention and investment.
Virtual currencies represent the possibility of faster, more economical and limitless payment. The emergence of virtual currencies did not threaten the smooth implementation of the monetary system policies by central banks as we could notice in the third part of the paper where analyzed the impact on the payment system, financial stability and price stability. Effect on canvas the system is minimal, but there is the possibility of easier use, low transaction fees and operational costs, greater access to anonymity with the possibility of monitoring the transaction if it occurs to illegal actions.
Debunking the myths
It would be fair to say that crypto is just the early stages of a new open financial system and that it isn’t perfect. However, it is a positive step towards a more open system. Every system comes with a cost. But there are a few myths and narratives surrounding bitcoin and crypto that should be clarified with facts.
Although cryptocurrencies have been used illicitly, the percentage of illicit activity among all cryptocurrencies from 2017 to 2020 as a percentage of total cryptocurrency activity was less than 1%. With the reduction in the illicit use of cryptocurrency, micropayments systems can begin making financial payments in exchange for bitcoin.
Bottom Line
Perhaps you are accustomed to unfettered access to a financial system in a developed country. Having this kind of access may seem unrealistic to someone living in a developing country with little financial and technological experience.
There should be little or no technical reasons to not participate, so you can see for yourself how things are developing in the crypto ecosystem.
