- WHY CRYPTOCURRENCY IS BETTER THAN LOCAL CURRENCY (FIAT) AND HAVING MONEY IN BANKS
- Why Use Cryptocurrency?
- Why would anyone use cryptocurrency
- Welcome to Blockgeeks
- 5 Ways to Use Bitcoin
- Like what you’re reading?
- Why would anyone use the Lightning Network?
- THE FUTURE OF MONEY: BITCOIN AND OTHER CRYPTOCURRENCIES
- What is Cryptocurrency? [Everything You Need To Know!]
- What is cryptocurrency — and how can I use it?
- Why spend crypto as a "currency" if it's value is going to shoot up?
- Ask an Expert
WHY CRYPTOCURRENCY IS BETTER THAN LOCAL CURRENCY (FIAT) AND HAVING MONEY IN BANKS
The term Cryptocurrency has been gaining the public eye rapidly over the last couple of years. Most of us are familiar with terms like Bitcoin, Ethereum, Ripple, Litecoin, Dash and other new booming cryptocurrencies such as DeepOnion.
There are several reasons why cryptocurrencies have been so inherently popular in the recent times.
Their flow is entirely determined by market demand, not controlled by some singular authority. They make for an investment endeavor that is generally rewarding thus cryptocurrencies can only thrive and multiply.
Before you continue reading, here is a brief history of how cryptocurrencies came into existence.
What is Cryptocurrency?
A Cryptocurrency is a form of digital currency created and managed by cryptography, an advanced encryption technology that makes payments secure. It started off as an academic concept before it made the leap to reality with the emergence of Bitcoin in 2009.
Why Use Cryptocurrency?
Bitcoin captured the attention of crypto-investors and media when it peaked at a record of $266 per Bitcoin in April 2013.
During its peak, it sported a market value of more than $2 billion. It was followed by many other cryptocurrencies such as Ethereum, Litecoin and other recent ones we see today. They all have the same basic underpinnings: They create and track a new type of digital token using a “blockchain”, a shared public record of transactions.
The digital tokens can only be created and shared based on the rules of the network agreed upon.
Some cryptocurrencies such as Litecoin, Dogecoin, and DeepOnion fulfill the same purpose as Bitcoin of building a new digital currency.
The only difference is that they come with tweaks to some of the details (enhancing the speed of transactions e.g. ensuring a basic level of inflation).
Others such as Bat and Ethereum follow the same principle but apply it to a particular purpose: Digital advertising and cloud computing in the case of those two.
Since their popularity is rapidly growing at a steady rate, does this mean that the alternative currencies will eventually supplant the local currencies someday?
Or will they flame out as a fad before long? In this article, we will explain in depth why they are better and the future of cryptocurrencies.
The glaring differences between cryptocurrencies and electronic fiat
There are significant differences between cryptocurrencies such as Bitcoin and the traditional digital currency in your bank account.
Bitcoin’s deflationary attributes are backed by the 21 million capped supply of the currency. Most economists have the belief that there is a great benefit in this concept since the public knows there are so many Bitcoins. The same concept is applied in other cryptocurrencies such as Ethereum and DeepOnion causing people to save, increasing the purchasing power.
On the contrary, it is very difficult to tell how much money is circulating with traditional digital fiat reserves.
No one has the idea whether the central banks are printing cash on a whim. Austrian school economists are against this type of monetary practice as they believe people are experiencing a silent robbery known as inflation.
This comes as a result of central planners printing large amounts of money for the fiat reserves.
There are times when the Federal Reserve informs the public that they create more money with concepts like recent bank bailouts and quantitative easing.
Another reason why the world’s economists are against the traditional fiat currencies is that the electronic form is used I monitoring the public’s wealth.
Why would anyone use cryptocurrency
It is very difficult to track cash and governments that are so keen on funds circulating their electronic databases. In addition, other government agencies such as the FBI, CIA, NSA and UK’s GCHQ have been known to spy on citizens and the monetary movements in the world banks.
The central authorities have the ability to censor people’s privileges using this power so that they can move money in any way they see fit.
There are clear examples of credit card companies and banks halting operations or freezing people’s funds because of particular reasons they do not agree with. This is totally no problem when it comes to the world of cryptocurrencies as it has already addressed the weaknesses of the traditional fiat currencies.
Do you still remember what happened in Cyprus in March 2013? It dates back to the day the Central Bank wanted to take back more than $100,000 uninsured deposits to help recapitalize itself. This caused a huge unrest in the local population. Initially, it wanted to retrieve a percentage of deposits below that figure by directly eating into family savings.
This is a situation that cannot happen with any type of Cryptocurrency because the currency is decentralized – meaning you own it.
Since no central authority is in control of the cryptocurrencies, the bank cannot take it away from you. Your money becomes safe and secure.
How will cryptocurrencies help you?
Unlike the credit card charge-backs, cryptocurrencies are digital and thus cannot be arbitrarily reversed by the sender or counterfeited.
A merchant gets your full credit line when you give them your credit card, even if the transaction involves a small amount. A credit card usually operates on a “pull” basis – where the designated amount is pulled from your account once the store initiates the payment.
On the contrary, cryptocurrencies use a “push” mechanism that allows you (the Cryptocurrency holder) to send exactly what you want to the merchant or recipient without further information.
- Faster and immediate settlement
Typically, a number of third parties (e.g. Lawyers, Notary), payment fees and delays are involved when purchasing real property. According to Gallippi, the Cryptocurrency blockchain represents a ‘large property rights database’ in several ways.
You can design and enforce Bitcoin contracts to add or eliminate third party approvals or reference external facts. It can also be completed at a future date for a fraction of time or expense required to complete traditional asset transfers.
A large number of individuals having access to the internet or mobile phones lack access to the initial exchange systems. All these people are primed for the Cryptocurrency market as it is widely accessible.
The blockchain maintains transparency as it keeps everyone honest.
It removes a whole layer of banking bureaucracy which lowers the costs. Even though there is no Cryptocurrency transaction fee, many still expect that a variety of users will engage a third party e.g.
Coinbase. This will help them in the creation and maintenance of their own Bitcoin wallets. All these services mimic the way PayPal does for a credit card or cash users, providing the online exchange systems for Bitcoin. As a result, they are likely to charge a small fee. However, it is essential to note that Paypal doesn’t accept or transfer Bitcoins.
The most important element about cryptocurrencies is that you own it. Cryptocurrencies give you a private key and a corresponding public key that builds up your Cryptocurrency address.
Unless you lose it yourself, no one can take that away from you. No central authority has control over it and thus a bank cannot gain access to your funds as well.
Bitcoin- The Current Standard
Bitcoin is a decentralized currency that incorporates a peer-to-peer technology. It enables all functions such as transaction processing, currency issuance, and verifications to be executed collectively by the network. Bitcoin is rendered free from interference or government manipulation with this decentralization.
However, there is no central authority that ensures everything runs smoothly or backs the Bitcoin value. Bitcoins are usually created digitally through a process called “mining”. It is a process that requires powerful computers to solve complex crunch numbers and algorithms.
Currently, they are being created at the rate of 25 Bitcoins after every 10 minutes. They will be capped at 21 million, a level that should be attained in 2140.
Bitcoin is fundamentally different from the fiat currency which is backed up by the credit and full faith of its government. Fiat currency is supervised by a nation’s central bank and is considered to have a highly centralized activity.
Theoretically, there is no upper limit to the amount of such currency issuance even though the bank regulates the amount of currency that is issued based on its monetary policy objectives.
Furthermore, local currency deposits are insured by a government body against bank failures. The value of Bitcoin depends entirely on what investors are willing to pay for at a point in time.
The Increasing Scrutiny
The benefits of transaction anonymity and decentralization of Bitcoin have made it a favored currency to host illegal activities such as money laundering, smuggling, and drug peddling as well as procurement of weapons.
This has attracted the attention of powerful government agencies such as the FBI, DHS and the Financial Crimes Enforcement Network (FinCEN).
FinCEN issued rules that defined administrators and virtual currency exchanges as money service businesses, bringing them with the ambit of government regulation.
A subpoena was issued to other 22 emerging payment companies asking about their measures to ensure consumer protection and prevent money laundering.
Alternatives to Bitcoin
Despite the recent issues about cryptocurrencies, the success and growing visibility of Bitcoin since its launch led to the unveiling of alternative cryptocurrencies by a number of companies. Some of the most popular include;
Litecoin was founded in October 2011 as a coin that was silver to Bitcoin’s gold as described by Charles Lee – The founder.
Welcome to Blockgeeks
It was designed for faster processing of smaller transactions. The benefit of having a Litecoin wallet is that it can be mined by a normal desktop computer unlike the heavy computer horsepower required for Bitcoin mining. Litecoin’s maximum limit is capped at 84 million which is four times Bitcoin’s limit (capped at 21 million).
Ripple was launched in 2012 by OpenCoin, a company that founded by Chris Larsen, a technology entrepreneur. Ripple is both a currency and a payment system just like Bitcoin. XRP is the component of the currency and incorporates a mathematical foundation like Bitcoin. The payment mechanism allows faster transfer of funds in any currency to another user within the Ripple network.
It operates within seconds contrary to Bitcoin transactions that need to be confirmed after 10 minutes.
MintChip is the Royal Canadian Mint, the creation of a government institution. Unlike other cryptocurrencies, MintChip is a smart card that holds the electronic value that can be securely transferred from one chip to another.
MintChip doesn’t need personal identification similar to Bitcoin but is backed by a physical currency – The Canadian dollar.
DeepOnion offers a better option of the alternatives of Bitcoin.
It is a highly secured Cryptocurrency that offers privacy, anonymity, and security from any threats unable to be addressed by Bitcoin. DeepOnion anonymous cryptocurrency provides a solution to send and receive untraceable payments.
It fulfills the requirements of the modern world by protecting your privacy and anonymity.
Why DeepOnion is preferred by most crypto-investors
- Allows you to send and receive untraceable payments
- Receive instant payment confirmations
- It offers a secure wallet for Linux, Mac, and Windows
- It has been listed proudly on several high secured exchanges making it easier to purchase the ONION currency.
- It has DeepVault, a feature that uses blockchain technology to check if your files have been changed or tampered with.
The myriad of technologies incorporated in DeepOnion’s wallet and blockchain manifests its strengths in enhancing the multi-faceted approach to security and privacy. Although DeepOnion might have several popular technologies seen in other currencies, it boasts a variety of proprietary solutions that further the state-of-the-art while offering additional anonymity from legal and illegal entities.
Since DeepOnion is a privacy-based digital asset, one can only think of an oncoming self-executing anonymous contract. It has a brighter future with all the positives around it compared to other alternative cryptocurrencies to Bitcoin.
This includes faster payment systems, lesser transaction fees, and unique privacy features creating best opportunities for crypto-investors.
5 Ways to Use Bitcoin
The Big Push for a Cashless Society
There have been a lot of discussion over the past few years over the world’s progression to a cashless society. Government authorities and bureaucrats all over the world have further bolstered the idea by removing individual notes of tender from circulation through demonetization of cash reserves.
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The traditional fiat currency (cash) used to be a dominant form of money before the seventies. Since then, most people transformed to transacting with an electronic representation of their local currency in their daily lives.
For example, physical notes represent only 8 percent of the world’s money and everything else is considered a form of digital fiat. Most countries worldwide have been progressing slowly towards a cashless society.
In 1975, the practice of electronic deposits into banks became popular in the United States. A decade later, people started using these balances with debit cards.
Recently, large denominated notes such as $500 and $1000 are becoming rare throughout a few particular countries as they are yet to be faced out from circulation. Last year, India suffered from a cash crisis as leaders began the process of demonization. There are several authorities pushing hard for a cashless society as they seek to replace the traditional currency with the digital fiat.
Censorship Resistance and Unstoppable Tax Protests
People have the ability to move their wealth in a permission-less way with cryptocurrencies using their individual sovereignty. Users of Bitcoin and other alternative cryptocurrencies can utilize the decentralized currency for operations that are frowned typically by third party forces.
This includes selling illicit drugs and other market activities.
Why would anyone use the Lightning Network?
There are people who use cryptocurrencies to avoid taxation leaving the decision of reporting tax officials up to the user.
It is coincidental that new technologies have raised the possibility of unstoppable tax protests. Authorities around the world are trying to co-opt the technology because the public is embracing blockchain-based currencies such as Bitcoin and other alternative cryptocurrencies. Central monetary planners have the belief that adding the word “blockchain” to the incumbent databases being used today will make many people to be lured towards a cashless society.
This means that it will be monitored and controlled with censorship. It would even be editable for those who try to erase fraudulent behavior. There is a very big disparity between cryptocurrencies and electronic money used by banks today since the former is far more superior for those who want to embrace freedom.
THE FUTURE OF MONEY: BITCOIN AND OTHER CRYPTOCURRENCIES
It is important to start by some of the limitations presently faced by cryptocurrencies. Many people claim that one’s digital fortune is likely to be erased by a computer crash or technological advances may cause the virtual vault to be ransacked over time by a hacker. Government agencies blame cryptocurrencies as means in which people commit crimes such as money laundering and avoiding taxes.
The basic paradox that will be harder to surmount about the cryptocurrencies is that as they become more popular, they attract more scrutiny from regulations and the government.
All this is aimed to erode the fundamental premise for which they came into existence.
The truth of the matter is that the number of merchants who accept cryptocurrencies has increased steadily and still, they are very much in the minority. It is essential for the cryptocurrencies to gain acceptance among consumers to become more widely used. However, most people are deterred from the relative complexity of transactions compared to the conventional currencies. A Cryptocurrency needs to satisfy widely divergent criteria to be part of the mainstream financial system such as;
- It needs to be mathematically complex but easy for consumers to understand.
The complex nature of cryptocurrencies intends to prevent fraud and hacker attacks.
- It should be decentralized but with adequate protection and consumer safeguards.
- It should preserve the anonymity of the user without being a conduit for money laundering, tax evasion, and other nefarious activities.
This has led to the emergence of alternative cryptocurrencies to solve the addressed problems associated with Bitcoin. Some of the dominant alternative cryptocurrencies include Ethereum, Litecoin, Ripple, Dash, DeepOnion, Peercoin and many more.
All these cryptocurrencies are putting all efforts on improving the criticisms associated with this type of digital fiat.
Since we have identified the formidable criteria to satisfy, the main question lies on whether most popular cryptocurrencies will have the attributes that fall in between today’s cryptocurrencies and the heavily-regulated fiat currencies. Although that possibility seems remote, there is little doubt that the fortunes of other cryptocurrencies in the years to come will be determined by the challenges or successes faced by Bitcoin.
Just like there is not one metal currency or paper currency there will not be one winner of cryptocurrencies in future. That is why we still use dollars, Euros, pounds, and many other types of fiat currency.
What is Cryptocurrency? [Everything You Need To Know!]
The only difference is that these currencies have geographic borders. Cryptocurrencies shorten this gap since they are widely accessible on a single platform.
The only boundaries in cryptocurrencies are that they have ‘use’ borders.
For example, ZCash is used by people who need higher anonymity, and Filecoin is used by people in need of a decentralized storage. DeepOnion seems unique as it can be used by people in need of faster transactions, 100% anonymity, security, and privacy.
Money Supply In Future
The opportunity is never going away since the generational wealth will keep flowing. Therefore, it is essential to know the basics of what to watch out for and why this opportunity even exists.
All the artificial rules and restrictions enforced by the central bank-licensed banking system will evaporate in the cryptocurrencies.
The main reason is that it feels extremely satisfying, frictionless and empowering compared to banking and Bitcoin.
They will transform the world at a rapid pace and anyone who uses it will be in a better position to move faster compared to other market players.
They will have an inbuilt advantage of using cryptocurrencies; Word will spread over time and the transformation will be unstoppable just like a nuclear fission. Bitcoin is considered as a paradigm shift and not a simple transition to a new medium.
Every assumption of what money is, who should control its production, how it is stored, managed and transmitted is turned on its head in Bitcoin.
People who are inured to the idea that the state should be the sole provider of money will find it very difficult to accept this transformation.
Bitcoin and other alternative currencies such as Litecoin, Ripple, and DeepOnion are considered as money without the state, banking without banks.
What is cryptocurrency — and how can I use it?
In the past, everyone knew that paper money itself wasn’t valuable and was a placeholder for real money held by the bank i.e. gold or silver. Cryptocurrencies never move from one place to another but they can be accessed all over the world at the same time by different people.
It has no guarantee or contract attached to it, it is not redeemable and cannot be backed by any institution anywhere on Earth. Electronic currency is easily transportable but has zero privacy and has transaction fees all over the system.
Cryptocurrency is the next generation of the money supply that will be easily transportable with little to zero transaction fees.
Furthermore, there will be no human intervention between the person paying and the payee. Besides high privacy, crypto-investors are assured of 100% anonymity, and security. The basic philosophy is;
- Decentralized – So no legal or illegal entity can gain access to your transactions and accounts, or mint money quietly for their own purposes.
- Security – So that nobody can steal or forge your money.
- Privacy – Eliminates spying on your transactions thus cannot be reported to other entitles.
- Functionality - This involves more technical parts of the blockchain incorporated in the Cryptocurrencies.
The intrinsic value of a coin is bestowed in its functionality and the computational power that is used to ‘mine’ that functionality.
Money is the Market
Anyone with anything to sell for Bitcoin or any alternative cryptocurrencies to Bitcoin is acting as a guarantor of the value of that Cryptocurrency. Each market participant guarantees to deliver you any kind of goods for Bitcoin instead of a central bank that guarantees to give you silver for your certificate.
The cryptocurrencies are being distributed and pushed into the market itself as the valuable sources of fiat currency.
It is impossible to measure its complexity and grasp its size as it so fine-grained. All money and goods are one I the new economy. You cannot rely on a state issuer of an altcoin for money as it will be absurd.
One of the key principles of a bearer instrument is that no one has to rely on another person to spend the money.
It is possible to steal a $20 note and claim that you are the owner by waving it around, but that would be a lie. Waving the stolen note just shows you possess it but doesn’t necessarily mean you are the owner. You will also be trafficking stolen goods if you took that note to someone and the recipient is considered no more the legitimate owner that the person transferring it.
The cryptocurrencies network is the most secure because of its vastness and can be mined by different self-interested parties.
Any small network can be easily hacked and no one would expose their digital tokens to the public. All they would want to do is to maintain complete control.
The Dreams for the Blockchain Pipe
Bitcoin and other alternative cryptocurrencies provide protections for privacy. Although one may have a tool to measure the system, they will be powerless enough to interfere with its operations.
Compliance has been set to become obsolete - a thing of the past. No longer will you have to answer several questions about collateral ownership and any other thing to do with what most people are doing in the market.
Central bank digital currency will never replace the ever growing demand in the Cryptocurrency market.
Why spend crypto as a "currency" if it's value is going to shoot up?
The systems will operate with no counterparties.
Over time, policymakers are going to be redundant and their means of influencing liquidity will be banished and disallowed permanently.
This is the true face of the central bankers of the future; obliteration and absolute annihilation. The imaginary ‘blockchain networks’ have received a service record of perfect and uninterrupted performance.
The Central bank altcoin currencies will be exposed as fraudulent in the white heat of legit cryptocurrencies and thus won’t be the foundation of a global system. Bitcoin and other alternative currencies are being developed for people all over the world and not for the benefit of central banks.
Should You Invest In Cryptocurrencies?
It is important to treat your investment in the same manner that you would treat other highly speculative venture when considering to invest in cryptocurrencies.
Ask an Expert
Most crypto-investors who made wise decisions in 2009 since the launch of Bitcoin have seen the rewarding benefit of their investments over the past years. Despite the criticisms facing this type of digital currency, it is important to consider why you are investing in cryptocurrencies and what to watch out for.
The truth of the matter is that not all emerging cryptocurrencies are the same as they differ in many aspects.
If you always feel like you are late to the party when the market is swinging, the primary reason is that other investors are beating you to the news. The reasons why you should invest in cryptocurrencies is that they are nigh impossible to counterfeit due to the complicated code systems that encrypt each and every transfer that is made.
This guarantees complete anonymity and utters safety to all users.
Despite the fact that many financial investors will caution you against them in their right mind, cryptocurrencies make for a genuinely risky but rewarding investment endeavor. The lack of any government agency that lends credence to them means that cryptocurrencies can only thrive and multiply.
So will cryptocurrencies be the new form in a few years to come? It might be too often to tell but statistics show the growing trend taken by Cryptocurrencies as they push towards a cashless society. One thing we know for sure is that this type of digital currency has a wide appeal to a particular section of individuals who savvy technology.
Soon, it will reach a point that everything will work in its favor.