Cryptocurrency Mass Adoption Episode 3 – Benefits of Cryptocurrency to the Economy

HOW BENEFICIAL IS CRYPTO TO THE ECONOMY?

There exist so many advantages of cryptocurrency to the economy of the nation and the global economy at large. These benefits will further enhance global trade. The benefits of cryptocurrency cannot be over-emphasized.

Some of the many benefits include

1)      Avoidance of fees by third-party banks: When sending money across orders a lot of fees are charged by the third-party banks as off-shore charges. This is aside from the normal exorbitant fees charged as commission, with cryptocurrency the huge fees can be avoided. The time and amount it will cost me to send value to someone directly in front of me are the same for sending to someone 1000 miles away from me, no third party is paid.

2)      Access to all: The use of cryptocurrency is available to all. There are no barriers whatsoever to trading cryptocurrency, there is no age restriction, gender bias, religion, race, colour, tribe, or any personal bias or inclination. Just anyone can interact with the blockchain transfer value from one address to another

3)      Access to a wide range of investments: As a result of the access-to-all feature of cryptocurrency, people living in any part of the world can invest in a wide range of investment options that accept crypto as a payment option. Some years ago, PayPal was the major payment gateway, if any country is not registered or blacklisted, investing from such countries was almost impossible. Now a lot of businesses have crypto as a payment option. This gives a whole lot of people access to invest in different business

4)      No third-party seizure: Governments around the world have often seized and closed the bank account of citizens who protests against them. Cryptocurrency cannot be seized, on 20th October 2020, the #ENDSARS protest by the Nigeria youth was brought to a bloody end. Afterward, the government seized and froze the account of the individuals who sponsored the protest. Similarly, in February 2022, a series of protests and blockages were held in Canada. After the protest, the bank account of the leaders of the protest was frozen. However, funds transferred via crypto cannot be frozen.

5)      Transparency of financial transactions: A lot of government officials have suggested that cryptocurrency makes it easy for money to be laundered. This is not entirely true. Money laundering existed before the existence of cryptocurrency. Tracking cash is not as easy as tracking cryptocurrency, the transparency of the blockchain has made it easy for funds to be traced from source to their destination

6)       Countries that are crypto-friendly and have made bitcoin a legal tender has attracted foreign investment. This has brought about an increase in the country’s GDP and a boost in the economy. This means developing countries seeking foreign investment can create a crypto-friendly environment to attract investors as seen in the case of El-Salvador.

7)      No more creation of fake currency: The creation of counterfeit currency is a major crime globally. Counterfeit currency is a currency produced without the legal sanction of the state or government, in a deliberate attempt to imitate that currency so as to deceive its recipient. As of 2020, the CBN revealed that over 56 million naira worth of counterfeit notes is in circulation. While the US Department of treasure revealed that an estimated $70m-$200m in counterfeit bills are in circulation. Bitcoin and cryptocurrency cannot be counterfeit. If a fake coin is created and sent to the blockchain it can never be confirmed which will lead to a failed transaction.

8)      Identity theft is impossible with crypto: Identity theft happens when a fraudster uses another person’s identity to commit fraud. Identity theft scam happens a lot when people try to make a purchase on a fraudulent website. They input their details such as name, date, credit card details, etc. these details are used by fraudsters to commit fraud. Crypto transactions are not susceptible to such. When making payment no personal information is revealed, no name, credit card, pin, etc. only the person with the private key has authority to spend the cryptocurrency and this is not revealed by any fraudster

9)      Direct control over investment: users who invested in cryptocurrency can have direct control over their investment. They can choose to spend all, invest, send, stake, and sell without permission from any person or government organization.

10)   No inflation: Neither political force nor corporation can change the order after deployment. The unlimited supply of fiat currency has created the problem of inflation. This has led to the gradual decline of the purchasing power of fiat. Bitcoin however has a finite quantity and the quantity of coins created reduces by half every four years. For other cryptos with so much volume and unlimited supply features such as staking and burn mechanism has been introduced to constantly reduce the total quantity in circulation making cryptocurrency a deflation currency with huge potential to increase.

In conclusion, the benefits of cryptocurrency in the economy will provide a lot of opportunities and wealth creation channels for citizens of any country that embraces it.

Cryptocurrency Mass Adoption series is a blog series that is aimed at promoting the use and adoption of cryptocurrency across the globe. This series will cover the meaning and benefits of cryptocurrency, the safety and security of using cryptocurrency, the merits and demerits of cryptocurrency, the role of government in cryptocurrency, the future of cryptocurrency, cryptocurrency and money laundry, the barriers to the mass adoption of cryptocurrency, etc. The series should last for three months with at least one post per week. I hope that at the end of the series my readers will be able to understand cryptocurrency and how best they can participate in the cryptocurrency space. That my readers will be well-positioned to milk the opportunities that exist in cryptocurrency and learn how to be profitable in cryptocurrency.

Cryptocurrency Mass Adoption simply refers to a time when cryptocurrency is commonly accepted and is used as a legal tender around the world. We have seen the industry’s big names the likes of PayPal, JP Morgan, Visa, Amazon, Walmart, Facebook, Twitter, etc come into cryptocurrency. Countries have not been left out of the party. In September 2021 El Salvador became the first country in the world to make bitcoin an official currency alongside the US Dollar. More countries are likely to follow suit and the major reasons why more countries are likely to adopt cryptocurrency is because low-income countries have suffered long because of the weakness of their currency and the extreme vulnerability to market changes which in turn triggers inflation. An example of this is the constant increase in the value of items sold in the local market as a result of the change in the price of the dollar against the naira. In our world, today, a lot of countries rely on another country’s currency, this has also brought about very often costly problems. A strong US dollar will weigh on emerging markets’ economic prospects owing to the fact that developing countries have taken so much dollar-denominated debt over the years which may be practically impossible to be paid fully. Cryptocurrency will provide a strong reserve for such countries.

Adoption of cryptocurrency by developing countries as legal tender will mean that these countries will have a currency that is not influenced by the internal market condition of their economy or any other country’s economy but by global economic changes as a result of the global scale of cryptocurrency. Countries like Panama, Guatemala, and Honduras are on the verge of making bitcoin a legal tender. Other countries however are passing deals and legislation on how to regulate the trading and mining of cryptocurrency. Some countries are considering the option of creating their own Central Bank Digital Currencies CBDC which may still be affected by the internal market conditions of their economy, while other countries are embracing already existing cryptocurrencies. The message is the same that the world has currently agreed that the future of money is digital and this will fuel the mass adoption of cryptocurrency.

According to Fundera over 15174 business worldwide accept Bitcoin, about 2300 businesses accept Bitcoin, over 13 major national companies accept Bitcoin payments, and there is an estimate of about 5041 bitcoin ATM machines around the world.

Cryptocurrency market capitalisation is also a metric that cannot be ignored when talking about mass adoption. With a valuation of about $2 trillion the entire crypto market capitalisation is higher than Amazon, Tesla, Berkshire Hathaway Inc., Meta platforms Inc (Facebook) MasterCard, JP Morgan Chase, Walmart, Alibaba group, Walt Disney company, Nike, McDonald’s, Netflix, etc with only Apple, Microsoft, Saudi Aramco and Google being higher in market capitalisation than the entire crypto market we can boldly say that cryptocurrency is the future of money and its mass adoption is not so far away.

A recent crypto statistics showed that a post on cryptocurrency including bitcoin surfaces on social media every 3 seconds. Bitcoin price is the best performing assets in the past decade. USDT a stable coin pegged with the US dollar hit an all-time high 24-hour volume of 109 billion dollars. Ethereum has about 1.193 million transactions daily. There was over 667 million crypto-malware (viruses) in March 2020. There are over 459 cryptocurrency exchanges in the world. Over 17583 listed Altcoins (alternative coins) in existence. There are over 81.3 million blockchain wallet users. By 2030 banks will save over 27 billion dollars by the adoption of the blockchain technology. Bitcoin has a daily transaction of 300,000 transactions.

In conclusion, the stats and numbers cannot be ignored by anyone with an understanding of money. Cryptocurrency is without a doubt the future of money. Although there exists a lot of contrary opinions and barriers to the mass adoption as we will see in the course of this series, proper understanding of the topic will determine how much you can benefit form the whole cryptocurrency bubble. The main reason why I believe cryptocurrency mass adoption is inevitable is because I am certain its time has come. In the words of Mario Hugo a French novelist “there is one thing stronger than all the armies in the world that is an idea whose time has come”.