This is a guest post by Rose Donner on decentralized currency. Enjoy!
The global financial economy in on the brink of a revolution.
The days when banks controlled the world’s wealth are long gone; nowadays, everyone can be independent from them by understanding the basic principles of Bitcoin and other cryptocurrencies.
Since the cryptocurrencies are powered by blockchain technology and their worth is based purely on the current demand, the central authorities have no say over the matter.
Apart from that, there are plenty of advantages associated with decentralized currency that you should be aware of:
Lower or non-existent fees
Don’t you find it annoying that the banks charge you every time you decide to make a transaction? Well, as it so happens, such a thing will rarely, if ever, happen with cryptocurrencies.
The only situation where fees may be introduced to the process is if you’re using an online wallet, which functions in a similar way as traditional payment processors like Paypal (although these can’t freeze your account for no reason as you’ll quickly see in one of the following paragraphs).
Yes, there is a maintenance fee – after all, these processors require some sort of compensation for the services they provide. But depending on the type of cryptocurrency wallet that you choose, you could absolutely get away without incurring any kind of fees at all.
Of course, you’re going to need to buy some first before being able to spend them or send them elsewhere, which you can do by visiting https://xcoins.io/buy-bitcoin-online or another platform that allows you to buy Bitcoin or any of the most widely-used virtual currencies.
No one can empty your financial reserves on a whim
Although there have been some cases of cryptocurrency-stealing malware, in a general sense of the term, your virtual coins are safe from being stolen from you merely on the basis of someone knowing your credit card number.
In comparison, when shopping online with a regular credit card, you have no choice but to reveal your whole credit card number plus the card verification number; in combination, they can be used to drain your bank account completely (unless you have some daily sending limits in place). This is referred to as the “pull mechanism” and it’s what has been used traditionally for a number of years.
Cryptocurrencies, however, are tackling the problem from the opposite angle by using the “push mechanism”.
So instead of allowing access to the funds so the merchant can collect however much is needed to cover the purchase, the funds are pushed directly to the merchant’s account without having to expose a number that could potentially be used for fraudulent charges.
No government control
Not only are cryptocurrencies outside of reach for any central banks, they’re also out of the government’s reach. Historically speaking, whenever the government tried to get involved with a currency, it often led to its demise. Remember the German Mark or the Denarius stemming back to the ancient Roman empire? The same fate befell them and the consequences are obvious.
For one thing, this can lead to inflation by printing too much currency in a short amount of time, causing each individual unit to be worth a tiny bit less, thus diminishing the buying power of those who use it.
Decentralized currencies, on the other hand, are not vulnerable to this, because no one controls them and no one can simply decide to print more. There’s a finite amount of currency that can never be extended.
For this reason, inflation can never affect your virtual coins and you don’t have to worry about them losing value because of it (they can, however, lose value due to a decline in demand).
No third-parties are involved in a transaction
Since decentralized blockchain currencies don’t require a man in the middle in order for a transaction to be performed, this is great in terms of financial efficiency. Essentially, it gives the power back into the hands of the people, because you don’t have to rely on another individual, bank, or a third party in order to complete it.
In practical terms, this translates to less complications and less fees. Even though the fees may appear minuscule at first glance, just take the time needed and calculate how quickly this can add up to something much bigger on a yearly basis. Moreover, there is no one who gets to decide whether the transaction will go through or not, effectively putting you in charge of your own finances.
Privacy and non-traceability
Since your identity or the details of the transactions are not shared with anyone, you get to enjoy all the privacy that you could ever dream for – your finances will stay concealed from those who want to stick their nose where it doesn’t belong.
Basically, no transaction details can ever reach the government or the bank when doing business by using a decentralized cryptocurrency. This ensures that your own identity stays protected at all times. What you do with the money that you control is, therefore, your own affair.
Understandably, several criminal organisations and ransomware developers have taken advantage of this in the past in order to extort payments from people without leaving a trace behind, but the benefits of the currency’s inherent privacy and non-traceability outweigh the occasional drawbacks by far.
You truly own your financial assets
Comparing cryptocurrency wallets with traditional online Paypal processors clearly illustrates how the former give you much more control than the latter. Paypal, for example, can freeze your funds at any time without prior notice, without requiring any kind of explanation or having to ask your opinion on the matter.
At the same time, no similar scenario can ever occur by using a cryptocurrency wallet. In essence, they are merely containers that store your funds and they have no power to decide what happens to them.
In the past, horror stories involving Paypal seizing people’s funds without explanation or falsely accusing them of malicious intent were not that uncommon. In turn, an increasing number of frustrated customers decided to turn to Bitcoin and other cryptocurrencies instead, so no one can revoke access to their funds quite as easily.
Cryptocurrencies are the way of the future. By educating yourself about the benefits of using them, you’ll be able to make better financial decisions and keep your financial assets out of harm’s way.
Are you already considering investing in one?