Crypto Is Becoming Mainstream. Here's How to Live In The Financial "New Normal" Cryptocurrency is not going anywhere. It is here to stay.
By Christopher Massimine Edited by Micah Zimmerman
Opinions expressed by Entrepreneur contributors are their own.
The future of money is changing. Many people think it's already changed — but it hasn't. Cryptocurrency is the future of money, but it still has a long way to go before its full potential can be realized.
Cryptocurrency is a digital currency that uses encryption to secure transactions and control the creation of new coins. The technology behind it is called blockchain, which is a digital ledger that records all the transactions. Cryptocurrency can be further defined as a decentralized system that uses cryptography to secure transactions and control the creation of new units of a particular cryptocurrency, referred to as "coins" or "bills."
Related: Smart Businesses Shouldn't Abandon Crypto. Here Are 3 Reasons Why.
The use of digital signatures provides powerful protection against fraud. However, there are other means by which an individual may attempt to gain unauthorized access or otherwise corrupt data within this system, such as altering transaction records after users have submitted them to take advantage of loopholes.
The first known use of cryptocurrency was in a paper published by Wei Dai in 1998 on "b-money," an early form of cryptographic currency based on proof-of-work. The idea was further popularized by Nick Szabo's description of "bit gold" and Hal Finney's reusable proof of work (RPOW) system in 1998. The first decentralized cryptocurrency created was Bitcoin, released in 2009 by Satoshi Nakamoto. At the time, it was worth less than one cent. Today it is worth over $20,000 per unit and is one of the most widely used cryptocurrencies on the market.
Cryptocurrency has moved from the realm of hackers and techies into the mainstream culture more quickly than anyone could have imagined. Countries are embracing it as an alternative monetary system, and many people in developing countries rely on cryptocurrency for their income due to its high volatility.
The potential for crypto as a medium of exchange is growing; tech giants Google and Facebook have announced their interest in the technology. Furthermore, major banks have begun integrating it into their business operations.
Cryptocurrency may become ubiquitous in the future, but there are still major hurdles to overcome before this happens. The biggest challenge for most people is understanding how crypto works. Many people won't use it unless they understand what the crypto is worth (or how much money you can get for it) or how easy it is to buy them with cash at a local ATM.
It also remains unclear whether governments will accept transactions using digital currencies like bitcoin. After all, if everyone began using them instead of government-issued money like dollars or euros, governments would lose control over monetary policy.
Related: 5 Tips for Using Cryptocurrency in Your Small Business
In centralized banking, corporate boards or governments control currency supply by printing units of fiat money or demanding additions to digital banking ledgers. If you were wondering, fiat means "by decree," so dollars are just pieces of paper with no intrinsic value. Their value comes from a government decree that they are legal tender.
However, cryptocurrency is becoming more viable. After all, it's a way for people to invest in the future of money. By investing in cryptocurrencies, folks are supporting the technology behind it and helping it succeed.
If you have followed developments in cryptocurrency over the past few years, you know that many countries are embracing this new monetary system. The most notable example would be Japan which has recently legalized Bitcoin as an official payment method. This means that all businesses therein now have to accept Bitcoin as a form of payment if they want to do business with local customers or government agencies who use Bitcoin as their official currency.
In many developing countries, cryptocurrency is a way to make money. It's a way to make money online, and it's also a way to make money from home. Cryptocurrency is a great way to start making extra income from home with no startup cost and no prior experience required. In addition, the crypto economy is growing exponentially, meaning anyone who gets in on the ground floor can reap huge profits for years into the future.
The future of cryptocurrency is exceptionally promising. With the rise of Bitcoin, we have seen that a new form of money can be created and distributed globally without any central control or regulation. However, the real value comes when you get people using it in their everyday lives because they believe in its use case as a currency or store of value. At this rate, that day may be sooner than we think.
Related: 5 Things to Know Before You Invest in Cryptocurrency
