What Problem Does Cryptocurrency Solve – Some questions and curiosities naturally creep into the minds of new investors in the digital currency industry. Of course, this is due to the lack of awareness of the benefits of the digital currency industry, which means that newbies are devoid of the benefits of the digital currency industry, and this is normal. Some common questions among newbies are: What are the real benefits of digital currency? What problems does digital currency solve? Why is digital currency a better choice than traditional money? Why should we accept digital currencies for our own sake? And there are many such questions, in fact, they have all the valid answers in favor of digital currency needed to convert someone from crypto to crypto fanatic. So, if you’re really curious to know the answer – what problems does the cryptocurrency industry solve that have plagued the traditional financial system? – So this article “The Top Financial Problems That Digital Currencies Solve” is for you. Continue the solutions developed by the digital currency industry
To be honest, when we were preparing for the research for this article “What problems does cryptocurrency solve? 6.2% in the face of. If you think coldly, you can understand what this percentage is. But unfortunately, This inflation rate has reached 7.2% by February 2022, the highest rate since 1982. The US is not the only victim of the inflation problem, but other countries, including Brazil, Turkey, New Zealand, Spain, have also expressed their displeasure.
What Problem Does Cryptocurrency Solve
Now we come to the topic of gold as a store of value. In 1980, the price of an ounce of gold was $2,400. Now in 2022, it has reached $1,800. So, if you want to keep gold, you have to calculate 25% loss
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Consider one thing, both gold and fiat currency do not have a fixed amount of supply and therefore supply is a weapon for inflation of these assets.
You see, what separates cryptocurrencies, especially Bitcoin, from fiat currencies is the fixed supply. As mentioned earlier, there is no fixed supply of fiat currency in the entire world. environment, even a penny and you know that gold also has no fixed supply
Therefore, this fixed supply feature protects cryptocurrencies from the issue of inflation, which is a major hindrance to fiat.
However, this is about supply, but one question still remains – why is there a demand for digital currencies? Will this constant supply feature be enough for cryptocurrencies when their value slowly declines?
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So, let’s take a look at the Sapless data. In South Asia, there is a healthy sense of hearing, that you can tell if your rice is cooked by tasting a grain of rice. If the hardness is medium, it needs a few more minutes to cook completely. A similar strategy is used when examining cryptocurrency data.
If you are in the cryptocurrency industry, you may have heard of Coinbase, a centralized cryptocurrency exchange. Based in the United States, Coinbase stands out as a well-known cryptocurrency exchange.
Coinbase had a total of 30,000 cryptocurrency users in 2013, and that number rose to 1.7 million in 2014. And the number of these users increased to 2.3 million in 2015, 4.7 million in 2016, 13.3 million in 2017, and 25 million in 2018.
So, you can see that the number of cryptocurrency users is increasing every year and this growth is continuing in 2019. For example, in 2019, the average number of users of digital currencies in the Coin database was 32 million, which increased to 39 million. 2020 and so on up to 43 million in 2020 and 58 million in 2021. So, we see in the chart the development of digital currencies.
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Let’s get to the second point, which is the real debate about whether cryptocurrency users around the world may decrease or increase over time.
So, at one point cryptocurrency is the harbinger of all new technological innovations, at another point it solves the inflationary problem of the traditional world with its constant supply feature. Therefore, the main wave of digital currencies is yet to come. We are still in the early stages of the Internet industry in the 90s. That’s why we put the “inflation problem” at the top of our list of problem identification points
You see, if you look closely at the world map, it becomes clear that due to the combination of the current financial system and social status, the rich are getting richer all over the world, and the opposite is happening for the middle class.
At the end of the month, ordinary people are left with money due to price increases, inflation, VAT, taxes and other related issues. And even if they have something in their hands, that amount can change their fate. This is a bitter truth to be clarified with an example.
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Of course not. Many people even think that Bitcoin will never be as profitable as it was in 2017 and 2021. And if you think so, then the next paragraph is for you
However, we are in the early stages and it takes a lot of investment to make a lot of money in traditional financial systems. But making big profits from the digital currency industry requires investing in a potential project.
Let us tell you a statistic – Indian consumers paid 263 billion rupees in foreign exchange in 2020. But interestingly, if these costs were paid in digital currency, those Indian customers would have saved 90% of the cost. Compared to traditional financial systems, the value of digital currencies is very narrow
You run the risk of having a large amount of native currency in your hands, as any leak of this information can cause a massive downfall, on the other hand, even if you have millions of digital currencies, you have no security concerns. No one around you knows how much cryptocurrency you carry in your hardware wallet. However, such freedom is beyond imagination with your traditional money
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Look, if you ask us to point out a specific area where the cryptocurrency industry is more advanced than the traditional industry, tell us the truth.
Indeed, solving a big problem deserves a big reward. The digital currency industry is dealing with cross-border transaction issues that were unthinkable even 10-12 years ago.
In traditional methods, cross-border transactions are expensive, long and cumbersome, but in the digital currency industry, they are easier, faster and cheaper.
A statistic shows that the volume of global payments and cross-border payment transactions could increase to $40 trillion by 2026. And this statistic can give you an idea of how big the market is.
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However, we must say that the market is still immature and not user-friendly. Why do we say this?
Just think it will come back sometime like 2020-2022, but you still have no alternative to cross-border transactions. You need to spend 2 to 3 days for the border transaction. Is this method reliable?
Therefore, the cryptocurrency industry can destroy the entire traditional industry with its instant transaction facility alone. So, let’s find out what major problems the cryptocurrency industry solves in cross-border trading, so the question is:
You can send limited amounts of money through the traditional banking system, with many formalities and complications, and the traditional banking system makes it more difficult for you to transact cross-border for business purposes.
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Actually the bank acts as a middleman between you and the person you are sending money to. So the bank helps you as a third party here. But there is a possibility that your information gets leaked here and there. . There is no fear when dealing with cryptocurrencies across borders.
See, depending on the country and transaction volume, you may have to go through an inquiry process while making a cross-border transaction through your bank. Sometimes the interrogation is so intense that you feel like a victim, it’s really annoying, but with cryptocurrency, you have the freedom to send no matter how much money you send and where you send it. No problem of responsibility and sharing of personal information in the space of digital currencies.
Unfortunately, Russia and Ukraine are currently at war. And the struggle also showed the limitations of traditional financial systems and the potential of digital currencies. Thus far, Ukraine has sent a total of $20 million in cryptocurrency as financial aid to the country’s troops after the Russian invasion.
So what is the only way to instantly send money to Ukrainian soldiers from any corner?