Fundamental Differences Between Cryptocurrency and The Conventional Financial System

Cryptocurrency and blockchain technology has grown a lot over the years and has been growing steadily ever since it was created just a few years ago… Blockchain has grown so popular and advanced that it gradually gaining adoption as many industries, institutions, sectors, and reputable individuals adopting blockchain and cryptocurrency technology. When it comes to cryptocurrency and its benefits, blockchain is an integral factor because there will be no cryptocurrency without blockchain technology.

Fundamental Differences Between Cryptocurrency and The Conventional Financial System

One of the main reasons why cryptocurrency was created is to combat the current financial system which has proven to have a lot of flaws and disadvantages. That is not to say that cryptocurrency is perfect and doesn’t have any flaws at the moment, however, cryptocurrency is solving some of the flaws of the conventional financial system and trying to improve on it and make it better for the users.

Transparency

This is one of the main characteristics and benefits of cryptocurrency is transparency. The conventional financial system is mainly dominated by centralized institutions that control every aspect of the system. We all know that there is no transparency when it comes to the centralized conventional financial system as they try to keep everything private without the users knowing what happens in the system. This is where cryptocurrency shines. Cryptocurrency runs on the blockchain which means that every transaction is publicly available for anyone to see and anyone can have access to any information that is stored on the blockchain.

Transactions cannot be altered/manipulated

This is another very good benefits of cryptocurrency technology. One of the major flaws in the conventional financial system is that transactions can be altered. This means that the transaction record of funds transfer can be altered. However, this is where cryptocurrency shines because any transaction sent on the blockchain from wallet to another wallet cannot be altered and is visible for anyone to verify. This is great because people can send funds safely without any fear of loss of funds through institution manipulation.

Decentralization

Another benefit of utilizing cryptocurrency is due to decentralization. Decentralization is one of the key features of cryptocurrency technology. The main reason why blockchain and cryptocurrency were created is to bring decentralization to the financial system. A huge disadvantage of the centralized conventional financial system is that the central institution and authority have so much power and control over decisions in the financial industry which a lot of times are biased and not fair to the users. With cryptocurrency and decentralization, the will be no central institution and authority that have all the power and control over decisions in the financial industry. Instead, the power will be in the hands of the users who make the decisions and have control of their funds.

Transaction Cost reduction

This is also another very good benefit of cryptocurrency over the conventional financial system. At the moment, there is a high transaction cost to send money, especially from one country to another. This has caused a lot of people to look for alternatives to send money which can be problematic and stressful. Yes, there are other means to send money to people from one country to another with a much-reduced transaction cost, however, it would incur another delay before the person cashes out the money as physical spendable currency. With cryptocurrency, there is a much-reduced transaction cost compared to the conventional financial system. Sending money from one country to another is much faster and easier and the person would get the fund in their wallet in less time and can spend it anytime they want.

Speed

This is a really important benefit of cryptocurrencies. We all know that it can be time-consuming to send a simple money transaction to anyone, especially in another country. There can be a delay in the conventional financial system and can take days or even weeks before the money reaches the person in another country. Cryptocurrency solves that because anyone can send money to anyone anywhere at any time without delay and the person would receive the money in much less time. This is great for businesses and individual to send and receive money in less time.

Uninterrupted payment

This is another very important benefit of cryptocurrency over the conventional financial system. At the moment, there are still delays and interruptions in payments due to network issues or system failure… this can be frustrating to users as the interruptions can lead to loss of opportunities and delayed payments for urgent situations. Cryptocurrency solves these problems because there is no interruption in cryptocurrency payments as everything runs on the blockchain.