What makes Cryptocurrency so important?

Why are there people vouching and spending all their savings on it?

Why are the modern millionaires so hyped about it while the older generations shy away?

There are various reasons.

• 1) It is a cooperative effort.

Humanity’s greatest asset to become top predator has had to do with our ability to cooperate. Sure, historically speaking, we had forms of authority and Governments which had the last say in the ongoings of daily life. However it is false to assume all power relied with a single despot. Even despots, tyrants and dictators had to cooperate with various groups of people in order to stay in power. They had to cooperate with guilds, business, military and other groups of people to remain functional.

Where it concerns Cryptocurrencies (and bitcoin), the greatest power lies within the community and implementation of the technology behind it. The community cooperates through exchanges, development and implementation. It has the edge over “classic” fiat money in the sense it is the ENTIRE community setting the price through transactions and implementations. Fiat money on the other hand is being handled by a central authority which DICTATES value (National bank of America, IMF in Europe,…) and has the power to invalidate ANY transaction on a whim if it suits economical needs. It has the power to unilaterally change the value of your money if it suits governments needs. That’s something to be fearful about.

Cryptocurrency on the other hand is backed by the entire community. No central authority can make a dent. No authority can force their ways by reason there is no central authority to begin with. It is community effort. A distributed effort. It works through democratic principles of “the majority decides”. Which is absolutely fine as it makes Cryptocurrency a major almost incorruptible market.

• 2) A distributed effort

Cryptocurrency and its blockchain technology is a DISTRIBUTED effort.
It means there is no central authority nor a decentralised authority.
Each and every member of the community (or node on the blockchain) has an equal amount of authority like anyone else in the community (or nodes on the blockchain)

The discrepancy where it concerns “whale movements” when investing in Cryptocurrency has nothing to do with holding authority EXCEPT for fluctuating value when compared to classic fiat money. Even those “whales” (people holding a big enough amount of Cryptocurrency to change market-value through transactions) hold no authority about what happens. You can have a guy holding on thousands of bitcoins in some forgotten digital wallet and his voice will still hold the same value as the guy with a measly 1 bitcoin in his digital wallet. Sure, the first will have a bigger influence on the trading platforms if he/she decides to cash in… but this implies distribution and effectively losing power.

The great advantage of Cryptocurrency is that it has no value when holding on. Markets fluctuate if large amounts are suddenly released, true. But the general set-up strives for even distribution to the point no one can claim central authority. The genius of Cryptocurrency is the value being decided through distribution. The value increasing as of each coin and token only a limited amount will be created. This, unlike classic fiat money where “New Money” can be created on a whim. Hence why things like hyperinflation are possible. Why markets can bubble and/or crash. With Cryptocurrency, this is impossible to happen.

Critics who claim otherwise generally think in terms of classic money and not in terms of “Cryptocurrency” and its set-up.

• 3) Fast, secured and feeless transactions

Cryptocurrency, due to its set-up has the advantage to make insanely fast, hyper-secured transactions possible. This due to its technological set-up and without relying on third parties to log, verify and authorize the transaction. It is a community-effort. Which means practically incorruptible. As the name “Cryptocurrency” implies, “encrypted”. Which means highly secured. Any trader and investor can attest that when buying Cryptocurrencies and creating/buying their digital wallets the layers of protection are, as a standard, MUCH higher than traditional banking transactions.

Traditional online banking implies putting your card in the computer legitimizing with a pincode and PRESTO, payments possible.

Crypto ups this by using authentic digital signatures, pincodes and special 12 word sentences as a STANDARD form of protection and encryption. Theft is only possible by the owner making active payments to fraudulent sellers (or through blackmail).

Transactions are also fee-less due to lack of central authority and bureaucracy.
Transactions are immediately done and due to the set-up of Cryptocurrency you might actually get richer by having made the transaction (instead of poorer by paying extra to have it authenticated and verified).

• 4) It is new and emergent

Cryptocurrency is like the Wild West and Californian Gold Rush rolled into one.
A wide variety of possibilities where wealth can be acquired and new ways of thinking and approaching problems are made possible.

Sure it is “wild” but anyone with a basis of financial education knows this implies “opportunity” to get ahead and make it better for everyone.

Established millionaires of the older generation prefer to hang onto the old system as it is the one THEY created and worked fine for them. They had their “Wild West” and became “the Sherrifs”, “Deputies” and “Mayors” within and prefer to hang onto that.

The few savy denounce Cryptocurrency but have a few wallets on the side.
Even Billionaires like Bill Gates, who disavow the investing advantages Cryptocurrency offers, have had Cryptocurrency. And I am fairly convinced these same people will still hold on to a few coins in case things get rough. The volatility of the Crypto-prices makes it an asset to earn returns of 20 – 30% on investment. These are returns unlike any other “classic” asset out there. Especially when considering my previous blog-post setting Cryptocurrency up as actual digital gold.

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