Positive impact of cryptocurrency
Cryptocurrency is a digital medium of exchange created, regulated, and exchanged through cryptography. In cryptocurrency, every trading transaction made is recorded in a blockchain ledger for easy reference and easy tracking of every detail of the deal. The cryptocurrency technology is increasing in the world as a result of growth in technology and globalization. Many people around the world are now shifting to cryptocurrency as it guarantees the security of trade they lack in the local currency and offers them an extensive network for doing business as the money is globally accepted. Cryptocurrency has led to increased security in the trade since every transaction made is recorded in the blockchain ledger. This system is not controlled by any state and where the deal cannot be altered whatsoever. Also in the block chain ledger the details of the transaction are readily available to both the buyer and the selling party creating transparency in the system and reducing fear of loss among the trading parties as the contract between them in the system is “smart”. Also since the transaction is recorded, tracking shipments of the goods and services are secure; minimizing the risk of loss is much. In cryptocurrency technology, a willing buyer meets a willing seller directly without any intermediary. This reduces the cost of trading as there are no transaction costs involved due to lack of middlemen like the banks or other financial institutions that may charge the transaction a fee. The direct contact between the two parties cuts the cost of the exchange making cryptocurrency an effective and inexpensive way of conducting business. Also lack of the intermediaries saves time as the transaction does not have to go through a lengthy procedure before its completion. Cryptocurrency has led to a low level of inflation in many states as it has caused currency competition. In many economies, the government is the primary determinant of the prices to be charged on different items and the interest to be charged by banks. With crypto currency such freedom for the government is reduced as there is an international currency competing with the local currency forcing the government to put in place measures to ensure the local economy does not collapse as result of crypto currency reducing the inflation level. From the foregoing, crypto currency has impacted well on the economy of different states and should be promoted to enable the world experience the full benefit.
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