Cryptocurrency: from origins to nowadays
Today information about Bitcoin, Ethereum, Litecoin can be found all over the Internet, TV and other mass media. What makes cryptocurrencies that popular? The main reason is, the virtual coins make the best form of the money ever. Digital assets have clear advantages including divisibility, portability, scarcity and validity. To get a better look at cryptocurrencies and their features, let’s turn the pages of history to know more about the money origin.
Long before paper money and coins appeared people used bartering which can be considered as the first embodiment of modern transactions. Ancient people exchanged different products and services to get what they needed. Some time later the all-too-familiar money appeared bringing a new trading system. People started to use stones as a means of payment for goods. Gradually, stones were replaced with gold that became the most common currency all around the globe. Finally in 700 B.C., the earliest known coins were minted, and the first taxes were charged.
The first paper money was issued in the 13th century. Bill owners could keep their money in trade houses, direct ancestors of all modern banks. Security and safety started to be greatly cultivated by financial industry at that time.
Time passed, and much has changed. Now we have traditional banks, global money transfers, online payments, credit cards and digital currencies.
So, what is cryptocurrency? It is a sort of digital assets created to be safe and secure. Cryptographic methods, used to design virtual coins, convert information into an uncrackable code which helps to track fund transfers. The invention of digital money is a considerable breakthrough on a global financial market.
The first fiat money was gold-backed. But these days, in the era of rapid technological advances, it isn’t anymore reinforced with gold. The US dollar keeps leading positions among paper money worldwide being the most common international and transparent currency. Blockchain is another transparent system providing an opportunity to keep funds in safety. Only the money owner can access it. There is no need to cooperate with any intermediaries, such as banks or electronic mints for transaction verification. Blockchain is a unique system which allows you to save your money and makes all transactions within a relevant network transparent.
To sum it up, let’s consider main pros of the cryptocurrency:
- Cryptocurrencies are durable. It doesn’t decay over time, and it shouldn’t be constantly replaced by mints or central banks as it happens with paper money.
- The cryptocurrency is divisible. You can divide it by any number, quickly and without paying any fees. While paper money can be divided only via the exchange.
- The cryptocurrency is verifiable. You can find out immediately that your cryptocurrency is real.
- The cryptocurrency is portable. It can be easily stored in crypto wallets or send across the world within seconds. As for the paper money it is much harder to do as traditional transactions usually take more time to be processed, especially over the long distances. In addition, the rates of money theft and fraud are higher when it comes to the traditional banking system.
Last but not least, cryptocurrencies are gaining momentum. Millions of people round the world use digital money and millions of people discover cryptocurrencies every day.
November 1, 2019
September 24, 2019
August 21, 2019