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August 17, 2018
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The entire concept of cryptocurrency has been seen as preposterous by the established financial elite since its conception in 2009. The critics of Bitcoin and other cryptocurrencies have been very hasty to declare it a fad, citing the market volatility, the lack of scalability, and the perceived stability of the big banks. Despite all these criticisms, Bitcoin alone has been able to facilitate over 300 million financial transactions since its creation. In addition, over 1,500 different cryptocurrencies are in circulation today — and the list just keeps growing. Although only around 3.5% of all financial transactions worldwide are made with cryptocurrencies, this is set to change in the near future.
Potential approval of a Bitcoin ETF by the SEC
The SEC is still contemplating approving an ETF for Bitcoin, and the larger community of investors in the US will most likely not make a move into the cryptocurrency territory before that happens. An approval by the SEC would further help validate and legitimize cryptocurrencies in the business world. Once it happens, and most people are certain that it will, the financial world will undoubtedly be affected by the changed cryptocurrencies are going to bring with them. The time and cost saved on financial transactions will change the banking landscape for the better. The decentralized networks, smart contracts, and secured ledgers will further help transform the industry.
Regulations will benefit the cryptocurrency industry, not harm it
Although many governments around the world, including that of the US, have already begun to implement regulations, it is still early days. Many questions regarding the regulation of the cryptocurrency market are still left unanswered, and many investors are waiting until they are. How, for example, will cryptocurrency exchanges be required to incorporate security measures that protect them from hackers and scammers? Questions like these are what need to be addressed in order to open up the doors to the world of investment awaiting cryptocurrencies.
Cryptocurrency transactions will be scalable
Although the number of cryptocurrency transactions being carried out at present is impressive, it is still nowhere near the scale of credit card companies. Companies like Visa and Mastercard process tens of thousands of transactions every single second. Networks like Bitcoin cannot even come close to that number at present. However, this is about to change. There are new projects in the pipeline that will address this very issue. Plasma, which will be tied to the Ethereum network, and Lightning Network, which is the corresponding Bitcoin app, will be facilitation rapid transactions that could rival those of credit card companies.
Cryptocurrency will make a move into the developing world
As with many new emerging technologies, cryptocurrency transactions are catching on even quicker in developing countries than in the west. The reason for this is that many African and South American countries are experiencing an unprecedented hyperinflation that is essentially rendering their national currency worthless. In response to this, more and more citizens of these nations are looking to cryptocurrency for solutions.
How do you think cryptocurrency will change business? Leave your thoughts in the comments below!
