Before cryptocurrency, the financial world was limited to only a few payment methods, either through physical cash or credit and debit cards. Today, thanks to the invention of cryptocurrency, you can now buy and sell goods and services virtually anywhere and anytime you want without a need for an intermediary.
This is only one of the many things you can do with crypto today. Learn more about cryptocurrency, its benefits and why you should use it here at BTC Post.
What is a cryptocurrency and how does it work?
Founded in 2009, Bitcoin is the first cryptocurrency invented by an anonymous individual or a group of people under the pseudonym Satoshi Nakamoto. It lets users transact online as freely and anonymously as if they were using real cash. Simply put, this type of currency only exists virtually and does not have an actual physical form.
All cryptocurrencies are powered by a blockchain, an online ledger of transactions distributed among computers around the world that removes the need for a central controlling institution. Every transaction is automatically updated on the blockchain through ‘mining’ which is a process of solving algorithms to verify transaction blocks and add them to the blockchain.
What you can do with cryptocurrency today
Though Bitcoin was initially created to be used as digital cash, nowadays people use it in more ways than just as a mode of payment. For example, the upsurge in the value of Bitcoin has made cryptocurrency a feasible long-term investment.
Seeing Bitcoin’s success, various developers have begun to create their own cryptocurrency that aims to provide more services and features than its predecessor.
Today, there are many cryptocurrencies on the market with different purposes such as Ripple (XRP), Ether (ETH), Litecoin (LTC) and Dogecoin (DOGE). As they become more popular, more and more people are asking what benefits they can get from using cryptocurrencies and if it really is worth the hype. Read on below to know the answers!
The benefits of cryptocurrency
Ease of access
Back then, you needed banks or other third-party institutions to financially transact which requires paperwork. But with crypto, all you need is your phone or computer and a reliable internet connection to make transactions.
Users send and receive cryptocurrency online, making it accessible to everyone. Also, as more people use mobile devices when conducting financial transactions, crypto can become a more popular payment method because of its fast and cheap services. In fact, more businesses and institutions now include it in their payment options.
Cryptocurrencies are encrypted to keep your personal details private, thus it is much harder to steal them compared to physical cash and credit cards. The strong encryption used in it serves as a protection against fraud and account tampering.
Hacking into your cryptocurrency is impossible unless the hacker knows the private keys to your crypto wallet and has physical access to your device. Furthermore, crypto wallets have a two-factor authentication process to add an extra layer of security for your funds, making it much harder for hackers to steal.
In addition, every transaction recorded on the online ledger is permanently stored and can no longer be changed. The only way to reverse it is to have the recipient send back the amount.
Low transaction fees
Read your account statements from your bank or credit card company and you’ll find many fees involved when you transfer funds, withdraw money or write checks. These fees can amount to a huge sum if you often do transactions. When you use cryptocurrency, there is no middleman involved so extra costs for each transaction will be removed.
However, if you want a third-party management service to maintain your crypto wallet, you will have to pay additional fees. Fortunately, the fees incurred by the third party are less compared to the traditional transaction charges, often going as low as 0.1% compared to banks’ 10% and above.
The decentralized system of the blockchain involves only two parties in the transaction: the sender and receiver. It is not governed by any central organization or financial institution. This means that no one will monitor any of your financial transactions and your assets will not be exclusively affected by economic fluctuations in your country.
In addition, since the government cannot interfere with cryptocurrency, they can’t impose any regulation on its purchase and sale, giving you the freedom to use it whenever and wherever you want. However, central institutions can regulate the operation of third-party services such as exchange sites so keep that in mind when choosing where to buy your crypto.
Making a transaction in cryptocurrency is more confidential than using physical cash or credit cards. When you use the traditional transaction system, your personal information will be used by the store, bank or credit agency to check and examine your financial history. This can pose danger to your account and may even lead to fraud or identity theft.
On the other hand, using cryptocurrency guarantees that every transaction is anonymous and secured. Moreover, no private information is recorded when you use it aside from your wallet address and the transacted amount.
Easier global exchange
International transactions expose you to exchange rates, transaction fees and middlemen charges. Meanwhile, using cryptocurrencies globally is not subject to such charges imposed by your country, thanks to its decentralized system. It offers a great opportunity for international businessmen to exchange assets virtually without complicated processes and additional fees.
Banks, credit unions and other financial institutions take control of your funds and leave you subject to their terms and conditions which they can change any time they want. Any violation of these terms can lead to penalties or worse, the suspension of your account.
Unlike other types of money retaining systems, cryptocurrency offers you sole ownership of your assets unless you are using a third-party management service. You are the sole owner of your funds and the only one who has access to it is you.
Experience the world of crypto now
The payment system has truly evolved over the years and cryptocurrency is one of the best innovations people have seen in the financial industry so far. With the continuous increase in the value, types and benefits of cryptocurrency, a lot of people are becoming more interested and hyped about it, making now the best time to switch to crypto!
Bitcoin (BTC) $ 19,383.77 1.33%
Ethereum (ETH) $ 1,066.27 3.17%
Tether (USDT) $ 1.00 0.03%
USD Coin (USDC) $ 1.00 0.24%
BNB (BNB) $ 216.67 1.11%
Binance USD (BUSD) $ 1.00 0.22%
Cardano (ADA) $ 0.448225 0.02%
XRP (XRP) $ 0.312662 0.85%
Solana (SOL) $ 32.68 1.44%
Dogecoin (DOGE) $ 0.066339 1.57%
Expand your knowledge and invest in the cryptocurrency industry.