A few years ago, if you had mentioned “cryptocurrency” to a friend, they would have imagined some kind of underworld banking system, with hooded traders sitting behind large computers. Today, you hear about it not only in your daily business news, but you even see the term bitcoin or crypto on the front pages of leading publications.
That’s because companies like Uber and eBay are joining a list of several household names that are scurrying to embrace cryptocurrencies. Earlier, the ride-sharing company, Uber said it would “absolutely” accept bitcoin (and other cryptos) “at some point” in the future, while eBay, which already accepts NFTs, may start accepting crypto payments soon.
As crypto attracts more organizations and their customers, governments around the world are trying to put regulations in place to make it easier for crypto companies to carry out their businesses while safeguarding investor interest at the same time. Recently, the UAE adopted its first law to regulate virtual assets, which could attract some of the world’s biggest crypto companies to the region.
But for some of us, who are still wondering if the correct term is “cryptocurrency?” Or should it be “digital currency”? “Virtual asset”? Whatever we call it, do cryptocurrencies, really deserve this much attention, and why?
What is it again?
Cryptocurrencies are a new financial system that aims to replace paper currency or become an investment asset. It’s given most people, and especially those who’ve never invested in traditional assets, an opportunity to earn income by buying and selling cryptocurrencies.
Unlike traditional currencies, crypto doesn’t have a governing body like a central bank or a monetary head, meaning it’s completely decentralized. Rather a community of people who are connected by a computer network transfer data between each other without the need for a central server. In doing so, this peer-to-peer community manages the transactions.
Why are cryptocurrencies so popular today?
Easy to use: The origin of cryptocurrencies may sound confusing but when it comes to using them, it’s very easy to get in. To begin with, you can buy cryptocurrencies from a crypto exchange, like BitOasis, which is also available on any device connected to the internet. Once you get cryptocurrencies, you can use them to make payments, receive money or use it as an investment.
Unique purpose: Most cryptocurrencies owe their popularity to Bitcoin, which has the widest brand recognition among all cryptocurrencies. Today, there are close to 10,000 “altcoins” or alternatives to bitcoin, and most of them have tried to improve Bitcoin. Each crypto project aims to solve a particular problem faced by a particular community. Litecoin is a cryptocurrency that is popular among people looking for faster payment settlements as it confirms transactions faster than Bitcoin. Another altcoin, Monero, focuses on the privacy aspect, making transactions impossible to trace.
Minimum investment: Of late, the general level of prices is going up across the globe, and at the same time, people fear that the value of traditional or “fiat” currencies will decline. So instead of saving money in banks, more people are now interested in investing in assets that have long been invaluable, like gold, real estate, stocks, and now cryptocurrencies. But there are other limitations like understanding commission and management fees when buying Apple or Meta stocks for example. And precious metals and property deals require a huge amount of capital.
Crypto requires minimum investment and some basic research to get started. In fact, you can buy a minimum of a dollar’s worth of crypto on exchanges like BitOasis instead of buying 1 entire bitcoin, for instance. Additionally, when it comes to portability and storage, you can store cryptocurrencies for free on cryptocurrency wallets that are safe and easy to manage.
As you can see, cryptocurrencies are more convenient to store, move and use than precious metals, real estate, and other investment assets, making them more popular than ever before.