What Is the Future of Cryptocurrency?

Cryptocurrency is the future of money or the next generation of money. Cryptocurrencies investments have seen a gradual rise over the years which depicts the general acceptance. Currently, as per the latest crypto news, we are seeing a big change in cryptocurrencies due to the emergence of institutional and smart money. Application of ETF (exchange-traded fund )is pending before the SEC, approval of which would take Bitcoin and cryptocurrencies to greater heights believed by many economic experts.

What is Cryptocurrency?

Cryptocurrency is a medium of exchange that uses the cryptographical functions to perform secure financial transactions, control the creation of additional units, and verify the transfer of assets. Cryptocurrencies use blockchain technology to gain decentralization, transparency, and immutability.

A cryptocurrency is built on a computer algorithm. It is an independent and digital currency that uses cryptography function to perform financial transactions that have no owner. The major advantage of a cryptocurrency is that it is not controlled by any central authority like country, institution or government or other currencies like rupee, dollar, euro. 

History of the First Cryptocurrency

In 2008, Satoshi Nakamoto released a whitepaper of bitcoin which he called “A Peer-to-Peer Electronic Cash System. “ 

Initially, the bitcoin was not so popular, but gradually the concept started getting acceptance and rose in popularity since then we have seen the emergence of over more than 4000 different types of cryptocurrencies which are popularly called as Altcoins.

Advantages of Cryptocurrency

Low probability of fraud: The cryptocurrency is a digital currency with a very low probability of fraud as it cannot be counterfeited or reversed arbitrarily by the sender, as with credit card charge-backs.

Highly Secured: The cryptocurrency uses the cryptography function for secure transactions. It is impossible for any person other than the owner to make any payment as private keys are used for signing the transactions and relayed directly to the network without any middleman.

No Control Authority: Due to the decentralisation nature of the cryptocurrency no central authority is required for validation 

Deflationary: The supply of cryptocurrency is fixed and cannot be increased therefore it is not affected by currency depreciation.

Disadvantage of Cryptocurrency

Legal:  The legality of cryptocurrency is still clear as some countries have legally recognized and some have declared them illegal. Apart from this, some countries have placed it in the 'grey zone'. Which means that neither it has been formally banned nor its use has been recognized.

Volatile: There is a high risk to investments in cryptocurrency because of its volatile nature and absence of any guidelines which makes prices susceptible to manipulation.

Conclusion