The term blockchain, cryptocurrency, bitcoin, ethereum etc. have been quite in news lately. For those who have been living under a stone, these are the technologies of the future, which have gained the attention of numerous industries, as well as individuals. These new technologies aim at digitizing money and making all sorts of transactions safer.
The blockchain concept is a bit complex to understand, however this post might be able to help you get a better understanding of this distributed ledger system. Once you get a good idea of this technology you will be able to understand what cryptocurrency is and why it is a smart decision to invest in them.
Here are five of the more obvious benefits.
1.They Are Fraud Immune
With cryptocurrencies, an immutable ledger is maintained for all the transactions which are taking place. This allows all the parties involved in this ecosystem to track any changes made in the ledger by any party and revert back this ledger to the initial state if any fraudulent activity is detected. Any change you make at any point in time will be reflected to all the members participating in this system. This also does prevent issues of counterfeiting, credit card frauds etc.
With cryptocurrencies, settlements and deals can be finalized within seconds. Any need for a third party such as brokers, dealers etc. is hence eliminated. You can purchase a house from any individual pay them through cryptocurrency and this payment would be recorded in a digital ledger which of course is immutable. The further signing of long contracts or getting documents attested etc. is henceforth no required. This immutable ledger would serve as a proof to you owning the house, and the same ledger will allow you to sell it to someone else if you required.
3.Prevents Identity Theft
Paying through credit cards online or giving your identity proofs to establish your identity in the real world, you are making yourself susceptible to what is known as identity theft. Such information generally is stored on a centralized server which if compromised will allow any hacker to access your personal information and hence portray that he is you. Cryptocurrencies operate on decentralized blockchain ecosystem where your identity is safe with you at all times and you only provide information required by the vendor instead of filling out those long subscriber forms which ask for most of your personal details.
4.Is Accepted Globally
Cryptocurrencies are now used throughout the globe and can be transferred or obtained seamlessly from anywhere across the globe. This digital money, if you may call it isn’t bound by interest rates, transaction fees etc. which makes the currency exchange and transfer process tedious as well as expensive one. With cryptocurrencies as we said before immediate, rather instantaneous transfers take place, making the process as quick as possible.
5.Lower Fees of Transactions
For now, there are no transaction fees involved in cryptocurrencies, rather the miner gets an incentive for mining a cryptocurrency on the blockchain’s ecosystem. There might be some fees which best cryptocurrency wallets may charge for maintaining your cryptocurrency account, however, it is very little compared to the traditional online wallets currently in use. Also, these wallets simply manage your cryptocurrency while having no control over your assets, unlike PayPal which may freeze your account, should it detect or suspect any fraudulent activities.
In short, cryptocurrencies are worth investing as they allow you complete control over the asset you own, while at the same time preventing you from serious issues of identity theft, fraud etc.