Cryptocurrencies, with the likes of Bitcoin and Litecoin being among the biggest names, are busy spreading like wildfire right now. You’ve probably got several people you know investing in cryptocurrencies, and they might be encouraging you to do the same. That said, financial gain is only one component of the cryptocurrency puzzle, though – it offers quite a number of other benefits too.
This might seem like a strange thing to associate with a form of currency – but it’s true. The blockchain technology that underpins cryptocurrency functionality is a highly innovative technology with applications beyond their immediate uses, because of how blockchain tech stores information. As cryptocurrencies become commonplace, the spread of blockchain technology will follow, and other industries besides finance will see significant changes as well.
Due to our increasingly digitised and online use of banking services, the opportunities for fraud and theft have increased substantially. Because cryptocurrency transactions are secured through the blockchain, meaning it’s permanent and virtually unalterable, the possibility of fraudulent transactions is effectively zero. It’s also separate from your bank account or credit card, so there’s an additional layer of separation that also increases its safety.
Using online transfers is certainly fast and convenient, but also dependent on multiple factors that can delay the process – such as transferring money between countries, banks, and limitations of certain amounts. While your average transactions may happen almost instantaneously, not all of them do. Cryptocurrencies are indiscriminate about those variables, so transfers happen immediately and won’t be bound by scaling fees dependent on the kind of transaction.
Online shopping is busy giving traditional brick-and-mortar stores a serious run for its money, and cryptocurrencies are likely to weight the scale in favour of online shopping even more. Fraud often occurs when customers use online vendors, and the vendors themselves can be affected by fraudulent purchases. The security features innate to cryptocurrencies encourage even more online shopping because there’s less danger and more peace of mind.
Crowdfunding is another concept that has been launched and sustained through online platforms such as IndieGoGo and Kickstarter, and the model has been adopted by cryptocurrency-using businesses, too. Initial Coin Offerings (ICOs) are to cryptocurrencies what Initial Public Offerings (IPOs) are to stocks, and ICOs promote investment to a larger set of potential investors, which decreases risk and increases the likelihood that a startup will get off the ground.
Cryptocurrencies, and block chain technology by extension, certainly looks like it’s here to stay, and also looks like it’s going to bring a heap of potential benefits to users as it grows.
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