Why blockchain is the future of finance.
Wondering why the whole social media is agog with the word “Cryptocurrency”? Don’t look too far, that is the future of finance in the world.
Like a famous quote “Evolve or Die”. The world has been operating on evolution for a long period. That is the reason change is the only constant thing in the world we live in today. Every sector that has added value to the existence of the human race has undergone evolution and the financial sector is not left out.
What is cryptocurrency?
According to Forbes Advisor, one of the biggest financial media outlet in the world;
“Cryptocurrency is decentralized digital money, based on Blockchain technology”
There are several cryptocurrencies in the world today, the most popular of them being Bitcoin. Other types of cryptocurrencies that are not Bitcoin are referred to as Altcoin (Alternative Coin).
Cryptocurrency is a decentralized currency i.e. it can’t be regulated by any country and it’s not controlled by any entity, unlike the FIAT currency.
Like every other currency in the world, cryptocurrencies can be used to buy goods and services. A lot of people prefer to transact with cryptocurrency as a form of assets or stock, trading in cryptocurrency has a high risk and high reward.
History of the evolution of finance
The history of financial transactions in the world can be traced back to the time of Barter, where people offer goods for the exchange of goods and services. Then comes the introduction of the coin, gold, paper, and virtual currencies that we see today.
The latest evolution in the finance world is a cryptocurrency and was first introduced by Satoshi Nakamoto in the year 2008 when he introduced the first whitepaper; he remains anonymous to date.
Although some countries are trying to kick against their citizens dealing in cryptocurrency due to its volatile nature, some are looking at ways to adopt it.
The biggest news for cryptocurrency enthusiasts is the government of El-Salvador making Bitcoin the official ledger tender of the country and also creating a Bitcoin mining plant. This is a landmark in the worldwide adoption of Cryptocurrency.
What is Blockchain?
Blockchain is defined according to Euromoney;
“As a system of recording information in a way that makes it difficult or impossible to change, hack or cheat the system”
The advent of technology has shaped their way of life, the world is not living a digital culture. Culture is the way of life of a group of people. One of the technologies that are shaping the future of finance in the world is Blockchain technology.
A lot of sectors in the world have gone digital, ranging from Communications via post to Google Mail, and the traditional media being replaced by new media. Space, where it has been difficult to go fully digital, is in the place of money because it requires a high level of trust and that’s is the masterstroke that Blockchain has provided.
Decentralized Finance (DEfi) is birthing the future of finance.
The term DEfi isn’t something that props up in everyday conversation in the cryptocurrency space, it is the name giving to the idea that birthed blockchain and cryptocurrency. It is a system that was set up to premise financial products, making them available on a blockchain network, outside the reach of anyone’s control.
This system is what is going to change the future of finance and have also birthed something great like NFTs that is merging the financial institution with art, which will help to reduce piracy and maintain originality.
Conclusion: The world is getting adapted to digital culture, with cryptocurrency not only serving as a currency but a means of making money and several exchanges propping up around the world, it’s safe to say the future of finance is here.
The interesting thing is that the blockchain revolution is merging all sectors with the financial sector.