Cryptocurrencies are a hot topic in the world of finance. While cryptocurrencies have been around for years, they’ve recently generated a lot of buzz because of their astronomical rise in value. But cryptocurrencies do not only generate headlines about their price fluctuations and volatility; they also have benefits to society that we can’t ignore!
Cryptocurrencies are more than just a trend. They can fundamentally change society for the better by creating economic equality, promoting democracy, and solving environmental problems.
For example, the deployment of Stablecoins can improve the global economy by providing a better medium of exchange that is free from inflation and fluctuating interest rates. When appropriately used, cryptocurrencies can be a viable alternative to fiat currencies.
The Benefits of Using Cryptocurrencies
Cryptocurrencies are the future of society, but most people don’t know how they work or if they can benefit them. Many people are skeptical of cryptocurrencies because they don’t understand how it works.
Cryptocurrencies (also known as digital currencies) can be used as regular money, but they’re different in that any government or bank doesn’t control their value. Instead, the currency is created and exchanged on computers around the world using blockchain technology.
The first thing to understand is what cryptocurrencies actually are. They’re digital currencies, which means they only exist online as strings of code with the monetary value assigned to them through encryption methods used on the blockchain network (the same way that money exists as numbers on your bank account).
Unlike fiat currency issued by governments, cryptocurrency cannot be counterfeited or duplicated because it’s decentralized. This means that no single entity controls its supply and transfers new units into circulation via printing presses or banks like we see with paper money today.
Below are the reasons why cryptocurrencies can be beneficial to society:
-
Increasing access to financial services
Cryptocurrencies enable decentralized, digital money to be transferred from one user to another without a third-party financial institution. They lower the barrier of entry for cryptocurrencies as they target populations that don’t have access to or enough resources to open bank accounts and partake in international transactions. As a result, cryptocurrencies help to reduce global economic inequality.
-
Enhancing individual autonomy and financial independence
Through cryptocurrencies, users can manage their own money without having to answer to anyone else. They are in complete control of their transactions (how much they want to spend or send) and where they store it (digital wallet). These features enable people who don’t have much money to take charge of their finances and enhance their autonomy.
Cryptocurrencies also allow people to be financially independent by giving them the power to control, track, and spend without depending on banks or financial institutions. This is beneficial for individuals in developing countries who are at risk of fraud when using banks.
-
Enhancing privacy
People who value privacy over price stability, security, and convenience should opt for cryptocurrencies. Cryptocurrencies are built upon a technology known as cryptography, which enhances users’ privacy by making their identities anonymous to third parties like governments or corporations that demand transparency in transactions.
As a result, cryptocurrencies can be used to protect one’s identity while paying for goods. This is especially beneficial to citizens of countries that lack a stable financial system. Cryptocurrencies do not need to be exchanged. There is no risk in using cryptocurrencies when paying for goods and services abroad because they remain unaffected by changes in foreign exchange rates or their home country’s currency value.
-
Reducing financial transaction fees
People who make more than two transactions per week should opt for cryptocurrencies instead of traditional fiat currencies (like the US dollar). Traditional currency exchanges are susceptible to fraud and charge high rates, which cryptocurrencies like Bitcoin do not have. This allows people with cryptocurrencies to trade more efficiently and with lower fees.
Cryptocurrencies also allow people to send or receive money faster, especially compared to the traditional banking system, which can take several days for international transfers. This benefit is particularly apparent in developing countries where individuals may not have access to a bank account but have access to cryptocurrencies like Bitcoin through providers such as Bitpesa.
Cryptocurrencies allow people to store their money directly on the blockchain and not through a bank. This means cryptocurrencies are censorship-resistant, meaning they can’t be shut down because authorities or banks don’t control them. This is beneficial for individuals living in countries government regulations are too strict.
Investing in Cryptocurrencies
Cryptocurrencies help a lot of people, especially those who do not have access to banks. One of the best benefits of using cryptocurrencies is that they allow people to manage their finances more effectively. Cryptocurrencies benefit society because they give people the power to control their finances. Therefore, cryptocurrencies can change society for the better gradually.
