Steemit Crypto Academy Contest / S2W2 – Cryptocurrency Adoption by @weasell
Hello crypto enthusiast, welcome to another week of crypto academy engagement contest. In today’s assignment we are tasked to discuss the impact cryptocurrencies will have in the global market when fully adopted.
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Discuss the adoption of cryptocurrency in the financial market and how businesses can be boosted through cryptocurrency transactions.
The first successfully cryptocurrency created was by someone under the assume name of Satoshi Nakatomo. Bitcoin was the first cryptocurrency created in the year 2008, due to the challenges encounter with the normal financial institute such as banks, many began to see cryptocurrencies has an alternate where they will be in control of their own assert.
The fact that cryptocurrency is not controlled by anyone make the adoption rate increase over the years and this also saw the creation of many other cryptocurrencies which most have a distinct purpose to serve in the financial market. The increase in cryptocurrency popularity has affect the price positively with cryptocurrency marketcap reaching all time high on yearly bases.
The financial market can be define as a market that allow people trade financial securities and also derivatives at low transaction cost. An example of these securities are stocks, bonds, cryptocurrency, precious metals and raw materials, which are all known as commodities in the financial markets. The financial market like any other market comprises of buyers and sellers and both are always in war to buy at a low price (buyer) and to sell at a high price (seller). This conflict between both buyers and sellers is what determine the trend of the market either uptrend or downtrend depending on who is in control of the market.
The financial market has an important role in the economy such as Intermediary function which include transfer of resources, enhancing income, productive usage, price determination and financial functions which deal with promotion of savings, investment and providing liquidity to commercial banks. All these functions are important to economy growth and are mostly governed by one or more rules to make it safer for buyers and sellers.
Cryptocurrency on the other hand, is a decentralized currency which means it not governed by any central authority which makes it a good alternate to invest in the financial market. The adoption of cryptocurrency financial market has proven very profitable to the traders which sees many cryptocurrencies given a massive profit such as Bitcoin which when from less than a cent in 2009 to $69,000 in November 2021. This is a high price change when considering the period and no commodity in the financial market has seen such profit within that period of time.
The major aim behind the creation of cryptocurrency is to facilitate everyday transaction by removing the need for a third party which often cause delay or other problems. So cryptocurrency is actually created to be a new form of payment but due to it volatility, crypto trader are using that opportunity to gain from the market.
Cryptocurrency has many advantages to offer when it comes to boosting business and some are:
-Increases reach: Cryptocurrency is available to anyone around the world, anyone with crypto wallet can pay for goods and services in the most convenient way. So for a business to accept cryptocurrency, this will open up a whole new market with high probability of positive impact.
-Reduce transaction cost: Business accepting cryptocurrencies deals with their customer directly and when there is no intermediary, transaction cost is reduced.
-Simply cross-border transaction: Cryptocurrency is not controlled by anyone which means it is immune to any government regulation or restriction. This means irrespective of government sanction on other country, Cryptocurrencies can still be used as a payment method which make business open to everyone around the world.
-Protection and speedy transaction: Cryptocurrency is a well secure digital currency due to the use of cryptography and blockchain technology so all transaction are irreversible and been independent of any third party make transaction speed very fast.
What is your opinion on cryptocurrency being accepted globally for our day-to-day transactions.
When Cryptocurrency is accepted globally for everyday transaction will be a good news for everyone due to many advantages it has over conventional currency and this will change the whole financial realm.
Our whole payment system will be reform into something more transparency, fast, and safe than what we are currently use to. Another major advantage of cryptocurrency is that the issue of Inflation has been eliminated. The cryptocurrency which will likely be used for daily transaction when this happen is Bitcoin and it has a total number which will ever be minted. So the issue of inflation as seen once in a while everywhere around the world which is crumbing our economic will be no more.
Do you think the high volatile nature of the crypto market is a concern to business owners? Discuss.
Yes it is a major concern to business owner and the cryptocurrencies market is highly volatile which is something worrying for any business owner. As explained early the cryptocurrency has proven very profitable over the years and this has made many people investment in cryptocurrency and this is having a negative effect on the market.
Swift buying and selling of asset makes the market unstable and price goes up and down. This changes in price can be a problem for business owner because customer can pay for an item in Bitcoin which is worth $50 and by tomorrow the price has drop to $40. This will become a big problem when the business owner want to restock that particular item and the price is still at $40, so at that moment the business owner is at a loss of $10 for just one commodity now let imagine for hundreds of item. It a risky move as the price of cryptocurrency can either increases or decrease with time.
What other factors are currently limiting the adoption of cryptocurrency and how can this be solved?
-Environmental Impact: One of the major factor affecting the adoption of cryptocurrency is the fact that Bitcoin been the most popular cryptocurrency uses a consensus that agree on mining. This mining operation require refined technology to solve complicated puzzles which demand massive energy to run. Our planet earth is under threat due to carbon emission and to generate the power required, million pounds of carbon will be release to the atmosphere.
-Government policy: Cryptocurrency is decentralized which means it is immune to government rules and regulation as seen in the conventional currencies. The government sees this as problem because most illegal business transaction uses this means for payment. Country like Nigeria has banned any cryptocurrency activities with local banks and china has impose law to limit cryptocurrency mining due to massive power required.
-User Education: Before anyone can get involve with cryptocurrency he/she has to know the basis of Crypto. Examples are knowing what wallet, exchange and blockchain are and this could be a lot of work for some people.
Discuss the Pros and Cons of cryptocurrency adoption by business owners.
Adoption of cryptocurrency in business will open the business to many advantages as well as few disadvantages.
Pros
Payment with cryptocurrency does not need a middle man which makes transactions fast and without daily or monthly limit. With cryptocurrency, huge amount of money can be send easily with little confirmations which is not the case when using bank or other financial institute.
Transaction charges will be almost nothing when compare to the total of funds sent which will encourage buyer to purchase more goods.
Security: Cryptocurrency is well secured to the extent that business owner does not need to worry about fraud or fraudulent activities on their account so far their keys are safe.
Transaction records are never lost and cannot be changed.
Cons
Cryptocurrency is highly volatile which will makes some business owner rethink their decision when planning on adopting cryptocurrency due to changes of cryptocurrency prices within short period of time.
Sending asset to the wrong business establishment wallet is irreversible which means that money is gone forever. No customer or business establishment can bear to make a mistake when it comes to payment with cryptocurrency.
Decentralized cryptocurrency wallet keys are in the hands of the account owner only, so if those keys are mistakenly lost, they is no protocol for recovery them and all funds in the wallets are not assessable to anyone without the right keys.
When cryptocurrency is fully adopted by all businesses around the world, this will not only help the businesses but also cryptocurrency in general because I believe with higher market cap, the volatility of cryptocurrency will be reduced and that is the major problem why most businesses are rethinking adopting cryptocurrency.
Thank you for reading.
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If cryptocurrency is adopted in the world, it will benefit all of us. I think it will be very useful for a businessman in that way. Because traders can easily receive payments through cryptocurrency and there will be no intermediaries.
Yes you are right both customer and businesses will benefit form it. Thank you for your comment.
You know it's still a shock to me how the identify of Satoshi Nakamoto it not yet known. The person that has had such a huge impact on the Financial world.
And like you rightly said, volatility of the Crypto market is a big big concern to business owners. It is one of the main reason they are lagging behind with adopting crypto currency.
This was a great post. I wish you the best in the contest..you can also engage with me through My link
Well I am sure they is a good reason for hiding his/her identity let hope we know who the person is in the future. Volatility in Cryptocurrency is the major concern for businesses around the world let hope Cryptocurrency can be more stable with time.
You've said it all brother, cryptocurrencies in our financial sector will undoubtedly increase transactions and profits. Thanks for sharing with us⭐
You are welcome thank you for your comment.
Crypto currency adoption is a very great plan as it eliminates third parties like banks and connects the customers to the suppliers. The banking system is very slow and flawed but this adoption would make them to either step up their game or to pack and go. Well written man