The world we live in is moving to a cashless economy. In fact, people prefer to get their transactions without the use of physical cash. That’s because they are provided with the opportunity to use all the online wallets to get transactions done. They provide a convenient and effective method to do financial transactions.
In prehistoric times it was an accepted norm of one person taking what another had by exerting force, and the winner took it all, and the vanquished had either to face death or defeat in battle whilst giving up all his possessions. It was a unique case of the mighty getting what they wanted without resorting to any other form of human decency, as there was none at that time, in the practice of acquiring what one needed from another.
The use of coins and paper currencies
Then came along currencies in the form of coins and paper, which are prolifically exchanged for goods and services, and these currencies are also traded on various platforms. The use of currencies to effect trading the words “buy and sell” came into use where there were a buyer and a seller of goods, and the former paid the latter for the goods that were exchanged. There have been no major issues with trading in coins and paper currencies. They are generally backed and supported by the relevant governments, which would have issued it with a substantial guarantee, as good for payment.
There were a few instabilities with some of these currencies, but on the whole, there were no issues, and the world was happy to trade with them. With the banking systems being introduced, trading was affected with neither the seller nor buyer handling the currency during goods exchange.
Digital age dominated by a cashless economy
The world going digital offered the opportunity to introduce cryptocurrencies, which have brought a new dimension to the world economic climate, on the premise that this system is foolproof and very secure. Cryptocurrencies were introduced to make all payment transactions done using cryptography, which was deemed to be as secure as possible and was built on the principle that no third party could infiltrate the system.
Cryptocurrencies are all online transactions and are deemed very secure and are becoming popular worldwide, where we could invest in them just like the other currencies that are prevalent.
Whether the world would shed the use of coin and paper currency and revert to an all cryptocurrency trading and investment environment would be a very distant dream. Still, at the present moment, they have shaken the foundations of the accepted paper currency citadel. The world is gradually practicing cashless transactions when we pay for our grocery and other bills at the checkout counters with our credit and debit cards, with further improvements envisaged in the future.
We have come a long way in our trading practices and payment methods. However, many online frauds are being committed, with even banking institutions becoming vulnerable to sophisticated criminals finding loopholes on the internet payment methods. They are using the internet to indulge in unscrupulous acts and have been getting away without leaving traceable footprints; whether cryptocurrencies would answer these issues would be anybody’s guess.
The increasing popularity of the cashless economy concept
The first cryptocurrency to be introduced was Bitcoin, which came into circulation in 2009, and since then, there are many being used with various names attached to them all over the world. Though cryptocurrencies were introduced nearly eight years ago, it has still not immersed itself in the fabric of the common people’s minds, hence their payment methods. It is still looked at with suspicion in the public domain.
The various cryptocurrencies are classified as digital or virtual currencies. Their popularity within the public domain has not been encouraged by statements issued by the Financial Crimes Enforcement Network (FinCEN), a bureau of the United States Treasury in 2013. Before the US Treasury’s FinCEN statement, the European Central Bank, in 2012, also came out strongly against these cryptocurrencies, calling them “a type of unregulated virtual digital money, which is issued and controlled by developers in a virtual community”.
The pressure intensified on cryptocurrencies when the European Banking Authority, the European Union’s financial watchdog in 2014, also came out strongly against what they too called “a virtual digital representation of value not controlled by a Central Bank or public authority of any country”. The crux among these statements stood out one essential aspect describing these cryptocurrencies: the word “Virtual,” which was generally used to define something superficial.
Obviously, the world financial fraternity was banding together to exert pressure and try everything they could within their power to ensure that cryptocurrencies did not have a free entry into an arena that they controlled with close the heart laws and regulations, denying any outsiders to enter. Cryptocurrencies were seen to be one such threat. They could topple them from their pedestals of holding and controlling the world economy with their own brand of currency, the outdated coin, and paper, which would one day become obsolete.
Unless and until the big powers, especially the United States Treasury and the British Exchequer with the other developed countries joining and banding themselves together, in support, there would not be much of a future for cryptocurrencies and would always be considered as outside the realms of the normal currency climate.
The United States dollar is the major currency that is traded worldwide, and whether the United States government would be willing to relinquish that high pedestal that they are sitting on would be a matter of contention. When they realize and accept the fact that cryptocurrencies would be the future for the world, then we could have a complete overhaul in the world financial environment, and many hope that that day would be sooner rather than later.
The noose is still kept tight around the cryptocurrencies, especially bitcoin, with no government anywhere recognizing its future potential. When that would be forthcoming, everyone would be eagerly awaited, who is trading at present in these, and would be looking forward to that day.