How Will Cryptocurrency Implicate The Future
Cryptocurrency is a hot topic of conversation right now, with Bitcoin being adopted by global merchants and it’s worth being set to skyrocket according to some people. Cryptocurrency offers a decentralised payment system that runs on the blockchain, which is a peer managed ledger. When transactions are made on a blockchain, they are added to the ledger and visible by all participants. Therefore, cryptocurrencies are near impossible to duplicate and steal by traditional means. Not only does cryptocurrency have great future implications, but the blockchain tech behind it can also revolutionise the business world in some aspects.
Gifting business equity to employees is one of the most common trends across the modern business world. To incentivise early talent, businesses will offer shares in the company profits. Now, thanks to cryptocurrency, businesses can create a self-sufficient crypto coin to gift. If the company and the coin succeed on the market, both the business and equity employees are set to benefit.
Transparent Wage Payments
Blockchain technology can be used to improve the security of wage payments through the use of smart contracts. Essentially, businesses will be able to set up a blockchain and program it to suit payment. For example, employers can set Bitcoin payments to be released once a set of conditions are met. In this way, both employer and employee have 100% transparency and payments are made immediately. For the freelance economy, blockchain payment will help to overcome international fees and exchange rates.
Once an employee has been paid in Bitcoin, they can transfer their crypto to a free online Bitcoin wallet provided by Paxful.com then sell it for cash in their online marketplace.
Raising Funds Through Cryptocurrency
If you’ve been on social media recently, you’ll know what crowdfunding is. At the moment, people love to fund projects and raise money for hopeful causes by calling on the masses. Anyone can put their case forward to the masses and seek donations. However, at the moment, there’s nothing solid to track donations. Therefore, with the help of blockchain technology, crowdfunding can be transparent.
When donations are made on a blockchain, each transaction is secure and visible to the entire community of donors. Therefore, it becomes impossible for anyone to dip into the fund and remove revenue without it being viewable across the entire ledger. As well as boosting transparency, this technology could greatly reduce third-party transaction fees.
Mainstream Payment Method
As mentioned previously, cryptocurrencies are slowly becoming accepted by commercial merchants. Along with that, they offer people an alternative and secure method of payment. In particular, cryptocurrency can eradicate transaction fees and third-party agencies. There is a long way to go before cryptocurrency replaces physical cash. However, as MicroStrategy CEO put it, Bitcoin is in many ways superior to cash. This endorsement has trickled through other parties, with the likes of Elon Musk investing heavily in Bitcoin and accepting Bitcoin through PayPal. Moving us forward into the mainstream space is Mastercard and Visa, two of the world’s largest payment providers, which have publicly announced support for Bitcoin and Ethereum. With the mainstream attraction cryptocurrency has received in 2021, it could only a matter of time before we’re using it to buy groceries.
What goes up must come down, and the benefits of cryptocurrency are no different. Despite being a fantastic payment alternative to real-life cash, there are enormous hurdles to overcome before it can be made commonplace. Continue reading to find out how the cryptocurrency revolution is being slowed down.
The very nature of cryptocurrency means that it will be susceptible to digital attacks and other breaches. Unfortunately, we’ve already seen this happening, with many initial coin offerings (ICOs) being attacked, costing millions to investors. Offsetting security breaches will involve constant cybersecurity development at every level, which is a gargantuan task in itself. However, as blockchain is still in relatively early days, we will surely see security measures strengthened to within reasonable standards above the capability of centralised banks.
Due to the very nature of cryptocurrency, there is too much volatility in its worth. Take Bitcoin, for example. In the space of 2021, it has faced value fluctuations between $20,000 and $60,000+. Therefore, it’s impossible to use cryptocurrencies on a full scale. Unfortunately, doing so means that businesses would struggle to quantify their earnings because they could lose assets at the drop of a hat.
The only reason to overcome volatility is to ground cryptocurrency worth to something physical. For example, if an energy company entered the scene with an internal cryptocurrency, it could assign a real-world value in terms of energy. Therefore, a user can invest in cryptocurrency without worrying about volatility. If real-world assets were assigned to cryptocurrency on a large scale, it could help to assure confidence in consumers.
Cryptocurrency transactions aren’t decentralised, which means that governing bodies and tax authorities have no means of monitoring transactions. Therefore, as it stands, investors can easily commit tax evasion through the crypto space. Unfortunately, unless cryptocurrency is adopted by governing bodies, the cryptocurrency bubble may implode.
One of the largest issues faced by cryptocurrency is scalability. At the moment, the number of Bitcoin transactions taking place is growing exponentially. However, it still doesn’t compare to giants Visa and Mastercard. Essentially, cryptocurrency blockchains may not be able to cope with demand. Fortunately, this issue is being addressed by next-generation cryptocurrencies including Fusion. As well as volume, crypto providers need to consider the speed of transactions. Simply put, although crypto transactions are fast, the infrastructure isn’t anywhere near large enough to cope with the entire demand faced by Mastercard and Visa. Until this issue is solved, the cryptocurrency revolution comes to a halt.
Cryptocurrency domination has a long road ahead of it. However, there’s no denying that blockchain technology, in general, can help revolutionise the business world. For example, by using smart contracts, wages can be paid securely and with full transparency. Despite blockchain tech’s advancements and uses in the world, when it comes to cryptocurrency, governments need to get on board with the changes.
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