If you haven't been living under a rock for the past few years, you must have heard of crypto currencies such as Bitcoin. Even though crypto currencies are less than a decade old but they have made their mark on the world. Bitcoin, which happens to be the most popular crypto currency available today, has a total market capitalization close to USD 100 billion. Several other crypto currencies have also gained a lot of popularity and several retailers have also started accepting major crypto currencies. Here is a list of some of the major benefits of using crypto currency.
One of the biggest advantages of using a crypto currency is that it results in immediate settlement and a transaction that has been settled cannot be reversed. There are no third-party approvals required as all the things that need to be checked are built-in. On the other hand, settlements are not immediate with the traditional systems.
As far as the transaction charges are concerned, these are almost non-existent as miners are compensated by the network. Therefore, miners do not depend on users doing the transactions to make money. There are several third-party services that help people in exchanging cryptocurrencies and they charge for their services but as far as pure bitcoin transactions are concerned, there are almost non-existent charges. On the other hand, you need to pay heavy fees if you take money through a credit card or a debit card.
Crypto currencies also tend to be safer as compared to credit cards or other forms of fiat money. If you are careful, your crypto money will always remain safe. On the other hand, there are several security issues with credit cards and debit cards. When you trade with a crypto currency, you can send the exact amount of money that you need to send without disclosing any sensitive information to anyone.
Crypto currency is decentralized and no central government or central bank controls the flow of the crypto currency. For instance, the algorithms governing bitcoin make sure that a maximum of 21 million Bitcoin is generated. This decentralization also means that there is no one central point of failure which is the case with Fiat currencies. Also, there is no central bank to regulate the interest rates or other such things, and market decides everything.
Crypto currencies can be used to make instant payments all over the world without the need for any third party. In other words, you can simply do transactions with someone sitting on other side of the globe without the need for any intervening party and this makes international trade extremely easy. It not only saves a lot of money but also a lot of time as currency exchange is almost instant and universal.
Another big benefit of crypto currency is that you are the true owner. On the other hand, when you are dealing in Fiat currency, you are just a holder of the value and that value can be decreased or taken away from you by the central bank that regulates that particular currency. Since there is no central authority in crypto currency, the value remains with you and nobody can take it away from you.
While there are a number of advantages of cryptocurrency, there are also certain risks associated with cryptocurrency. Therefore, it is important that you take the pros and cons of crypto currencies into account before you decide to use it.
The Palm Beach Confidential review has more in-depth information about investing into cryptocurrencies.