The potential that cryptocurrencies are holding over the world currently has seemingly no bounds. Transcending national borders, it has successfully emerged as an application of blockchain technology that effectively works for anyone with a smartphone.
This has led to a viable method for a lot of investors in developing nations to access the credit they otherwise couldn’t. The cryptocurrency trading options have, therefore, become a medium for big and small corporates to empower themselves with methods that are seamless, and contribute to their growth reducing risk factors to a large extent.
Cryptocurrencies hold significant potential in the corporate world, and their disruptive power cannot be put at bay. From altering the way payments across the world are processed, to bringing a variety of methods for document verification, and many more, the applications of cryptocurrency are innumerable.
The user index for 2021 shows a 97 percent confidence in cryptocurrencies, which has speculated for the global blockchain market to go up to $23.3 billion by 2023. It is also a seeming assumption that the market size for cryptocurrency will reach $5190.62 million by 2026.
One reason for this surge the world is witnessing is the decentralised peer-to-peer blockchain-based systems, crediting which any user can spin up a node, and be an equal participant in the network. Thanks to decentralisation, a lot of industries are basing their businesses on blockchain technology as it effectively demarcates the concept of third party integration.
While it's essential to understand that blockchain is the future of decentralised and very difficult to tamper, secure and transparent mechanisms, it is important to ascertain that cryptocurrency is just another form of currency facilitated by the high end operations of blockchain technologies.
The trends that are set up through cryptocurrency, and its ability to be decentralised, have impacted financial markets in many different variations. Blockchain technology is paving the way for a new corporate landscape, which creates more room for MSMEs, and even big financial corporations to take charge, and help the world to step into a new phase of FinTech.
Reforming Finance And Banking
Trading in cryptocurrencies has been thriving by providing a new avenue for enhancing a host of more traditional treasury activities. It has enabled simple, real-time, and secure money transfers, and strengthened the overall control for the capital flow. It has also mitigated the risks, and managed opportunities of engaging in digital investments. Owing to these factors, cryptocurrency has made individuals the master of their own money.
As the banking sector comes into the vision, finance management based on blockchain gives people who were otherwise far behind in the queues of traditional methods of finance management, an opportunity to engage in transactions quickly, and without any judgment involved. As digital assets stand as the backing of their loans, the services require no credit checks. Investors too on the side can earn interest on their holdings of digital currencies, which generally surpasses the amount they get via cash deposits in a bank.
Decentralisation in modes of banking, and finance management also reduces the areas of weakness that are generally perceived in the system. Diminishing these factors avoid any kind of systemic failures or inefficient services which are a result of exhaustion of resources, periodic outages, bottlenecks, lack of sufficient incentives for good service, or even at times, corruption.
From a larger perspective, decentralised blockchain solutions are being explored, and adopted by industries across all sectors. While we are eyeing at opportunities to make cryptocurrency an intrinsic part of the everyday lives of global citizens, the first move towards recognising it is transitioning, and also busting myths associated with cryptocurrencies that they lack pragmatism in this digital ecosystem.
Rahul Rathod is CEO, CryptoBiz Exchange. Views are personal and do not represent the stand of this publication.