FIAT vs Crypto — Stuart
There is a lot of resistance to the idea of cryptocurrencies from certain people.
Their concerns seem to assume that there is something inherently bad about a currency that isn’t controlled by a central authority. There is a lot of logic and research that shows why these concerns are unfounded. But, they still have a strong effect on the public and on the traditional financial system.
The way that traditional banks work requires them to keep a lot of money in reserve. This can be difficult in areas of the world that are unstable or are at the whim of traditional banks. Because of this, a lot of people don’t have access to traditional financial institutions.
Cryptocurrencies solve this problem by being a completely decentralized system. This means that a lot more people can get access to their own money, rather than having to rely on their government or other institutions.
Stability and Security
The financial markets are notoriously unstable. This is why a lot of people are worried about the future of cryptocurrencies. It should be recognized that the cryptocurrency markets are still a long way from stability. This is indicative of their relatively new nature and how they are still being developed. The important thing to remember is that as cryptocurrency markets become more stable, they are also becoming less volatile. A lot of people see this as a good thing, even if it is a short-term phenomenon that will eventually level off. If you look at how traditional markets are doing, they are still pretty volatile. Even in the face of the global financial crisis that has been going on for quite some time, traditional markets haven’t fully stabilized. This makes the cryptocurrency markets look pretty good. There is also the question of security. It has been proven that a lot of traditional markets are vulnerable to attacks and, in many cases, they are prone to human error. Cryptocurrencies are again a good option because they are secure. While they are still vulnerable to attacks, the level of security is far superior in the cryptocurrency world. The technology behind cryptocurrency is also a lot more secure than a lot of the other options out there. It is based on peer-to-peer networking technology, which is highly secure. This is different from the centralized technology that is used in the traditional financial system.
Cross-Border Transactions
The idea of cross-border transactions is another one that is often cited as a negative for cryptocurrencies. This is based on the assumption that cryptocurrencies are only good for transactions that can’t be done in traditional currencies. If you look at how the traditional financial system is set up, this makes sense. But, it is becoming clear that there is a lot of potential for cross-border transactions to be conducted with cryptocurrencies. It is still early on in this process, but these types of transactions are starting to take place all over the world. This is especially true in areas of the world that don’t have a stable banking system. There is a lot of potential for people in these areas to make use of cryptocurrencies and take advantage of the benefits that they offer.
No Capital Gains Tax
Another benefit to using cryptocurrencies is that they are not subject to capital gains taxes. This is a major benefit to a lot of users because they are able to keep most of their profits, rather than having to pay a certain portion to the government. One of the biggest problems with using traditional currencies is dealing with the tax situation. If you want to use your profits to invest in other opportunities or to help out family members, you have to pay taxes on those transactions. If you are just trying to save your money, this can be a big problem. With cryptocurrency, you can avoid paying these taxes altogether. This can help you to reach your financial goals more efficiently
Open Accessibility
Another benefit to using cryptocurrencies is that they are open to everyone in the world. This is different from the traditional financial system because not everyone has access to banking services. In fact, some countries don’t even have this type of system. If you look at how the traditional financial system is set up, it is aimed at being inclusive. But, it isn’t designed for universal access. This means that there are a lot of people who don’t have access to their own money. This means that they don’t have the opportunity for financial improvement. There is also the question of gaining access to money that is difficult for these people to move their money out of their area of residence. This is why cryptocurrencies are so appealing to some users. They can take the money that they have and move it to different areas without the necessity of dealing with traditional banks. Not only that, but they can also send the money to other people without going through the bank systems.
Low Transaction Fees
One of the biggest problems that have been associated with using traditional currencies is the high transaction fees that can be associated with them. This is especially true in traditional online transactions. The problem is that you have to pay fees for each transaction. This means that if you are just using your money to do basic things like making online purchases, it can get very expensive. This is also a problem for people who are trying to make money through online transactions. As these transactions increase, the fees get more expensive. This can put a cap on your ability to make money using your money. Cryptocurrencies don’t have these limitations. You don’t have to pay these fees and you only have to pay a small transaction fee using cryptocurrencies. This means that you can save a lot of money when using cryptocurrencies instead of traditional money.
Borderless
Cryptocurrencies are also borderless. This means that you don’t have to worry about things like international borders or exchange rates as you would with traditional currencies. If you are making an international transaction, you are going to have to pay international fees. This is very expensive and, a lot of the time, it makes sense to deal with local currency instead. This is not only a problem for international transactions. If you are dealing with a company in another area, you likely have to pay a lot of fees to exchange your money. This can be costly and you often lose a lot of money from the exchange. Cryptocurrencies don’t have these limitations. They are not subject to exchange rates and you only have to pay a small transaction fee if you are dealing with a business that is accepting cryptocurrency. There are also no issues of conversion or exchange rates. This is a big benefit to a lot of users because you don’t have to worry about paying money in fees.
No Centralized Government
The biggest issue of using traditional currencies is that you have to deal with a centralized government. This is a problem because your government can change your rules on you at any time. This can be a problem in a lot of areas. There is a lot of uncertainty as to what could happen if governments change their rules. There is also the question of what happens if your government collapses, which can happen in more unstable areas. If you are dealing with cryptocurrencies, you don’t have to worry about government control or instability. This means that you can use the money you have to your own advantage. No government is going to be able to change these rules or take advantage of you.
FIAT Continuation…
This all being said, FIAT currencies will most likely continue into the future because they serve the implementation of global centralization. A global currency means a single reserve held by a single authority, which in turn means a single power. That is what is important to pay attention to. It is all a game of power.
While it is hard to imagine an “end” to FIAT currencies, it is possible that they could be transformed into a digital ledger. The implications of a global ledger are not yet fully understood. However, as mentioned above, global centralization is the key, and that seems to be the direction that everyone is moving towards. Bitcoin and other cryptocurrencies could simply be a stepping stone to a larger plan, which is the creation of what essentially amounts to a global central bank. Governments are already beginning to explore the possibility of a “digital currency” which would replace cash altogether. While bitcoin has proven itself to be a viable store of value, it is still not as much of a good solution for a medium of exchange, but perhaps one day it will be. To be clear, one could argue that the current banking system amounts to global centralization as well, which would make the current FIAT currencies the equivalent of digital currencies. Perhaps there is more to this than meets the eye and bitcoin and other cryptocurrencies are simply a side effect of a much larger global power struggle.
Is it all a big conspiracy?
It is entirely possible that it is. However, the point of bitcoin and other cryptocurrencies is to allow for a free market to decide what is best. While central banking proponents would argue that the current system is the best solution, those in favor of a free market would argue that the current system is the least efficient. Everyone has an opinion and the only way to discover what is truly best is to let the market decide. The problem with a global central banking system would be that it would create a global single point of failure. While it may be a great system for those in power, it is likely that it would not be the best system for the rest of the world. Just as the US dollar has failed the people of Zimbabwe, a world central bank would likely fail the rest of the world.
The power struggle between bitcoin and other cryptocurrencies and the world’s current FIAT currencies is an interesting one to watch. The most important thing to pay attention to is the power struggle itself.
Thanks for reading :)
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