Crypto Frontline

What is a Cryptocurrency?

What is a Cryptocurrency?

What is a Cryptocurrency?
November 07
16:44 2017

According to the dictionary, a cryptocurrency or digital currency is a digital coin you can send through the internet. This currency represents a value that is not issued by any central bank or government but is accepted by people as a means of payment for goods and services.

Comparison with traditional money

Digital currencies have a number of advantages compared to fiat money of traditional money.

First, in order to use the traditional money you are dependent on the banking system. Traditional banks charge fees on every monetary transaction and this increases the cost of everything you buy.

Cryptocurrencies instead can be changed over the internet, from person to person, person to business, business to business, bypassing the banking system. This means lower fees, no spending limit and no restrictions on your account.

Your digital currency can be stored in a digital wallet or cloud wallet and can be traded on a digital currency exchange, and could be used to buy traditional fiat money, like the euro, sterling or the US dollar.

Cryptocurrencies have increased in popularity in the last years mainly because of no government intervention. However, the lack of legislation in this field makes it attractive to money launderers, that’s why it is possible that in the near future some measures could be taken by public authorities.

However, the future belongs to technology and money as we know today will most likely change over time. We expect technology to play a major key in the evolution of the monetary system, no matter if the cryptocurrencies that exist today will disappear.

The technological development could further support the use of cryptocurrencies and who knows, maybe in the future cryptocurrencies will be used on a larger scale. There are still many things to improve at the present time, so it’s too early to make predictions.