When I try to explain the concept of cryptocurrencies to a slightly older crowd, I usually go for the simplest form of explanation. “It’s just like any other type of money, but you can’t physically touch it.” I tend to tell them.
Currencies have changed a lot in the past hundreds of years. Gold coins were the standard form of payment or currency since the invention of currency. Later in time, paper fiat currencies were invented and were linked to a gold standard, meaning that their value was linked and could be exchanged for gold. In the 20th century the gold standard was abolished and fiat currencies were only as valuable as banks, central authorities and traders decided they were.
In 2009 Bitcoin was released. By being a decentralized digital currency with blockchain technology, Bitcoin is more transparent, secure and allows greater privacy than even fiat currencies. In the following years more cryptocurrencies were launched such as Ethereum and Monero. Many more uses were found for blockchain technologies and cryptocurrencies managed to break into mainstream consciousness.
Despite many big economists and figureheads in the finance world publicly denouncing Bitcoin and cryptocurrencies, it’s popularity hasn’t seemed to notice. More and more people have started to see cryptocurrencies as a viable competitor to fiat currencies with many more perks. Bitcoin and most other cryptocurrencies have spiked in value.
Many small but revolutionary coins and initial coin offerings have been released in the past year. Amongst them is Game Protocol which plans on disrupting the video game industry by decentralizing their platform, store and a cryptocurrency based crowd funding platform for indie games.
With the growth of popularity of cryptocurrencies there have been growing calls from central banks and financial figureheads to regulate and monitor the world of cryptocurrencies. Regulation and centralization are the antithesis of cryptocurrencies and could squash its growth.
Cryptocurrencies are clearly on the road to replace fiat currencies and become the currency of tomorrow. The only hurdle in cryptocurrencies path to success is the central bankers, regulators and governments who would rather prefer that it never existed. With nations like China banning crypto exchanges, the threat from the establishment might be real but with cryptocurrency’s high level of security we doubt it will ever disappear.