Since 2009, the cryptocurrency phenomenon has come into use in many areas of human life and is still going strong because of its advantages over the traditional financial system. Bitcoin was the first digital currency, but cryptocurrency exchanges introduced other coins. Therefore, there are over 9,000 cryptocurrencies in circulation nowadays. For now, it is only the beginning of the crypto revolution. Besides, many individuals still question that the crypto industry’s heyday will persist for a long time. In this article, you will discover the factors that can destroy digital assets and is it even possible.
Cryptocurrencies have become a new challenge for governments and businesses. Some individuals would say they disappear in a few years since crypto is nothing more than a bubble they do not believe in. On the one hand, digital assets are unpredictable and their rapid fluctuations confuse ordinary people. However, if you try to learn more about cryptocurrency, you will realize that the technology underlying coins is far more serious than you realize. Blockchain technology is encrypted by cryptography and has the potential to become a commonplace reality, as the Internet did.
To comprehend the significance of cryptocurrencies, we should examine the causes that prompted their emergence. First of all, the most crucial reason for bitcoin’s and the cryptocurrency system’s growing popularity is complete decentralization. It means that GPU and ASIC miners are responsible for issuing new coins and wallets that store the crypto are not linked to any bank or banking institution. Furthermore, unlike banks, there are no limits on the number of monthly transactions using crypto. No one can impose limits on transactions involving large sums of money, hence crypto assets are ideal for these purposes. Another obvious advantage is that crypto cannot be bankrupt except for when the coin is unreliable and the exchange platform removes it, so we can conclude that crypto holders are much more protected. Also, to compete with others, certain crypto assets strive to deliver near-instantaneous transaction speed.
Moreover, nowadays, cryptocurrency is regarded as a revolutionary breakthrough, having a great impact on the financial sector. However, governmental regulation can be a significant impediment to the acceptance and popularization of cryptocurrency. As you may already know, news regarding laws regulating currency functionality affects rates largely. For instance, Chinese regulators have prohibited financial institutions and payment companies from processing transactions with cryptocurrency. They also cautioned investors against engaging in speculative cryptocurrency trading.
Given the scarcity of Bitcoin and many other digital assets, it is likely that their value will continue to rise for as long as people use them as a store of wealth. Be sure, the potential for crypto growth is enormous, so we would be amazed if most coins did not surge in value over the following several years. Cryptocurrency is regarded as a lifeline for countries whose banking systems do not permit basic operations and services.
However, the official system’s inflexibility was a prerequisite of cryptocurrencies’ emergence. Digital assets could bridge the gap between the widely acknowledged system and the present needs of market participants. For the time being, the overall market cap has surpassed $2 trillion, demonstrating that the crypto industry is a major part of the digital economy. Also, looking from long timeframes gives us hope that the crypto industry’s best days are still to come.
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Valentina BEREZA, Team bit4you