Almost everything in the world is moving towards being digital, and economies aren’t an exception. In this article, you’ll see what does cryptocurrency increasing popularity means for you?
One promising digital payment form is a cryptocurrency, and it’s currently taking the globe by storm. Conversations around its use have begun to dominate mainstream discussions about the future of money and payment methods. Big and established institutions, such as PayPal, Square.inc, and Tesla, among many others, have all given the nod to Bitcoin, which is a lead player in the cryptocurrency world.
Are They Really Trustless Systems?
Trustless systems refer to currencies that aren’t in regulation by a central body in the way that paper money is, for instance. No nation-state or government can claim control over a trustless system.
Whether or not cryptocurrencies are really trustless systems has an impact on the currencies’ way forward. This is because one of their major differentiating factors is their perceived autonomy from bodies that might affect their future value.
Professor J. A Grundfest has posited that cryptocurrencies while enjoying a certain degree of autonomy, aren’t totally trustless. They rely on the underlying infrastructure that powers them, and where this infrastructure is located holds theoretical power over crypto.
Even with this possibility, cryptocurrencies remain the closest there is to a trustless system, and, because of that, their popularity continues to surge.
What Does The Increased Popularity Of Cryptocurrency Mean For You?
Predictions are tricky, yet the increased adoption of cryptocurrencies as a mode of payment can mean several things. If you currently hold one or several of the cryptocurrencies or are thinking of investing in one, you might be wondering what the heightened popularity may affect your investment. In short, is it a good thing or just a frenzy that’s limited to talk, without actual impact on the currencies themselves?
Below, take a look at how crypto is likely to respond to the surge in popularity and usage.
Improvements In The Regulatory Environment
For crypto to support this growing interest, its regulatory environment will have to grow in tandem with its popularity. It has to keep protecting user identities while still promoting tax compliance and discouraging money laundering. So, to be complex enough to avoid hacks yet easy enough to understand and be used by the consumer. It has to be as decentralized as possible yet be ‘controlled’ enough that it’s adequately protected and safeguarded at the base.
There’s already evidence of these measures being developed in response to the wide usage of cryptocurrencies.
Increased Trust: Cryptocurrency Increasing Popularity
The immediate factor that the increased popularity of cryptocurrencies will touch is the levels of trust towards them. As more and more people become confident and believe in the value of cryptocurrencies, the more their value can also increase.
Value fluctuations and volatility have always a concern when it comes to cryptocurrencies. But some of this volatility can be the market becomes confident in the digital currencies in all their forms.
Widespread adoption is probably, one of the best things happening to cryptocurrencies right now.
In order to thrive, any currency depends on the confidence it generates in its buying power and stability. Crypto is gradually achieving this fundamental.
This growing confidence in crypto is also leading to increased demand. And, here, the laws of demand and supply start playing their part.
Crypto, by nature, is in nature. Take Bitcoin, for example—there’s a limit of only 21 million Bitcoins that will ever enter circulation. Of those 21 million, 18.5 million have already on. Evidently, there are only a few Bitcoins still to appear, and that jump to the exploding demand of Bitcoins, it can be that their value will continue to appreciate over time.
In addition to this already a supply, a lot of Bitcoins are by long-term investors, limiting the number of Bitcoins available for circulation and transactions. The commodity, whose demand is drawing towards an all-time high, is also going towards increased scarcity. Thus, the value of Bitcoins can rise.
Cryptocurrency Increasing Popularity: The Take-Away
Cryptocurrencies are continuously gaining wide acceptance across the globe. For one, major corporate players have started to place their weight behind different leading cryptocurrencies. This has had various levels of impact on cryptocurrencies. All of which are likely to lead to an increase in the value of crypto.
If you currently own any cryptocurrency or are about to buy some, now is a good time to hold on or buy it before the expected rise in prices.