Steemit Crypto Academy Contest / S2W1 - How Cryptocurrency has Shaped the Financial Realm. What is Its Future? by @negro-bby
Good day everyone, my name is oluwatimileyin, and I will be joining the engagement challenge in the SteemitCrypto Academy, where I am going to discuss how cryptocurrency has shaped the Financial Realm, here is my entry, thank you.
Users are expected to briefly give an overview of cryptocurrency.
Draw a comparison between cryptocurrency and conventional currencies.
Explain the distinctive innovations of cryptocurrency and their downsides.
How do you think major problems with cryptocurrency can be handled? Let this be a response to the downsides highlighted earlier.
Do you believe in the future of cryptocurrency? State your reasons. Any Recommendations?
Users are expected to briefly give an overview of cryptocurrency.
The world cryptocurrency comes from cryptic and currency, cryptic simply means something that is untouchable or can not be seen but does exist, or we can as well refer cryptic to something that exists in a coded way, that is, it is somehow mysterious and the "currency" modified the word, as currency can be a note or something of valuable assets, so cryptocurrency simply means a coded asset, popularly known as Digital currency.
Cryptocurrency came to existence in 2009, and Bitcoin is the first-ever cryptocurrency to exist, Bitcoin is the father of all crypto in the world, and it came into existence due to the instability in the conventional banking, and also the world Bank financial crisis in 2008 triggered the Bitcoin Founder Satoshi Nakamoto to create an asset that doesn't exist in the third beneficiary banking, but an asset that can be kept by the individuals with the full control over there assets.
We have seen crypto to have succeeded so far, as at 2009 when bitcoin was created, the coin was approximately worth $0, whereby as time goes on Bitcoin's price hit $1 in 2011, and now we can testify that bitcoin has once hit $60,000 in 2020, this as shown a great improvement and has proven otherwise that cryptocurrency has totally changed the world financial platform, and as well has brought lots of users to financial stability, Creation of Bitcoin birthed other digital assets with more than 18,000 crypto coins in existence today.
Well, we should know that cryptocurrency consists of many things, and there are things to be considered before we can consider something as a crypto asset.
Wallet Adress - Before a coin can be considered a crypto coin, it must have its wallet address, whereby it must have a public or private address for sending and receiving assets from others.
Blockchain - Before an asset can be considered crypto, it must be built on a specified blockchain or be built on its blockchain, Blockchains are where the blocks are created, and also where information is stored before being asses.
Security - A crypto-asset must have untraceable security, the crypto coin must consist of keys, such as mnemonic keys, and private keys, these keys are unique to the irrespective address, and can only be known by the owner of the particular wallets only.
Decentralized - A cryptocurrency must be decentralized, meaning there get to be no third-party involvement when carrying out transactions, whereby there is no third monitoring application or user, and full control of the account belongs to the owner of the asset.
Draw a comparison between cryptocurrency and conventional currencies.
Here, I shall be discussing the difference between cryptocurrency and conventional currencies.
| S/N | Cryptocurrency | Conventional currency |
|---|---|---|
| 1 | Cryptocurrency is decentralized, meaning that unique users have full control over their assets | Conventional currency is not decentralized, that is there is third-party involvement when you are making deals, such as Human to the bank to account. |
| 2 | Cryptocurrency is a digital currency, it can not be seen or touched but only exist | They are physical cash that can be felt or touched and also exist. |
| 3 | All records are stored on the blockchain ledger, which can not be tampered with | Records are stored on the physical ledger, and they can be tampered with. |
| 4 | All transactions are plain making it impossible to compromise | Secret way of transacting, whereby they can easily be manipulated. |
| 5 | Full encryption of users' funds making it invisible to hacks | Lesser security since all user data can easily get hacked. |
| 6 | Highly volatile and controlled by market | Low volatility making it a safer investment. |
| 7 | Irrecoverable in the case of mistakes | Mistakes can still be revoked. |
Here are the similarities between Cryptocurrency and Conventional Banking.
They both save information in a ledger, crypto uses a digital ledger(blockchain), while the Conventional bank uses a Physical ledger(File Book)
They are both modes of investment, as both crypto and conventional currency can both be invested in to yield positive rewards.
They are both mediums of exchange, that is crypto-assets can be traded for one another, and a conventional currency can be traded from one note to the other as well.
Explain the distinctive innovations of cryptocurrency and their downsides.
Despite all the good sides of cryptocurrency, some downsides come with it as well, this part can not be neglected, but as an individual, many crypto companies are still trying to figure their way around it to make it better.
High Volatility - This is one of the major down parts of crypto, the crypto market is mostly controlled by the buyers and sellers, whereby, it is highly volatile and most crypto markets are not stable, as it has been said over and over to always invest what an individual can afford to lose, and most crypto investments are not for small earners as money can easily be lost to the market.
High Transaction Fees - There is some crypto that offers low fees for transition charges, and at the same time, there is some crypto platform with the cost of charges, for example, in the Ethereum network, transactions on Ethereum is the most costly.
Mistakes Irreversible - this is another downside of crypto. cryptocurrency is not for small users and not for beginners also, crypto mistakes are irreversible, mistakes can not be traced, whereby, whatever the amount is, once the transaction was being misspelled or quoted wrongly, it is irrecoverable, and also, account lost to mistakes are gone, irrespective the amount of investment or assets in the wallets.
Crypto innovations
Well, crypto as a major part has brought some nice modes of investment.
Delegation - This can be seen on the crypto platform where users do not need to work or do any hard work, but delegate their assets and watch their money do the trick for them.
Staking - Staking as well is one of the innovations of cryptocurrency, whereby users can stake in the expectancy of getting rewards, depending on the amount of coin they possess, which in this case, is a safe mode of investment with low risk.
How do you think major problems with cryptocurrency can be handled? Let this be a response to the downsides highlighted earlier.
Here are some of the ways the Downsides highlights earlier can be tackles.
Improved Volatility - crypto market is too volatile, and this does happen because of the people buying and selling the crypto market, this is mostly caused by the fear of missing on trends, I believe the volatility can be tackled by having a hidden order book, which in this case, other users don't get to know the amount of the crypto buy or sell that does cause the fear of missing out to other users.
Reduced Transaction Fees - The crypto platform can reduce its transaction fee, such as the Ethereum network, the Ethereum has higher transaction charges due to the amount of money it costs to keep the blockchain stable, but in this case, the blockchain can increase its scalability by having series of Blockchain layers.
Create a two-step-verification - The crypto wallets loss can still be handled In a way that there can be multiple ways of verifying the uniqueness of user data, in this case, wallets don't get to be lost forever without the user not having asses to their account again, the two-step verification gets them to be back on their account.
Do you believe in the future of cryptocurrency? State your reasons. Any Recommendations?
Yes, I still believe in the future of cryptocurrency, the downtrends seen in the crypto currently have been something of occurrence, and also the Ukraine Russian war is causing a great effect on this, I believe in the future when the war dial down, the crypto market will be back at the uptrend and we can as well see a great movement sooner.
Major counties are now adopting crypto, for example, my country Nigeria doesn't allow the regulations around crypto and as well saw crypto as a threat to the national currency, but recent, the country also launched its crypto coin known as E-naira, all this still proves there is still a great future for cryptocurrency.
Bitcoin is still heavy, well before we considered a turn down in the crypto world, we have to consider the movement of bitcoin as well, as we can see that bitcoin is still printing within the range 0f 20,000 dollars and 30,000 dollars, this also shows that the market is still stable despite the hit the currency has been taking, the stability of bitcoin proves the stability In the crypto business.
I believe that cryptocurrency has come to change the world and its financial realm, it is the future, and likely the way out to the masses, without crypto, the steem blockchain will not have been in existence, same as the steemit platform that curates and award users, so its safe to say crypto has changed many lives, and also lift many individuals to great stability of finance.
The crypto currency realm is the only place where everyone stood a chance of equality, regarding your tribe and background, it levels the finance world, whereby everyone is allowed to participate with no restriction of special treatment to anyone, so in this case, I still strongly believe in the future of cryptocurrency and I believe that there is still more to come.
I invite @icon-monday, @weasell, to participate in this contest, thank you.
Hello
I found your publication very interesting, especially the part about market volatility, since this is something that is currently being reflected in the market.
From my point of view another important aspect when investing is always to diversify our investment portfolio because unexpected things can always happen, like what happened with TERRA.
Good luck in the contest
Your explanation on the subject of 'Comparison between cryptocurrency and traditional cash' is impressive.
Well said. Hopefully the ban of cryptocurrency in our country is lifted so we can openly enjoy this future as well
Yes my dear friend when the first ever crypto coin whose name is bitcoin was no value in the year 2009. But in 2021 its all time high was 70,000 dollors. so we can imagine from here that how bitcoin give us a huge profit.
Yes, we can generate reckless income by putting our coins at stake, which is a great invention of cryptocurrency. Thanks for sharing with us....