Topic: Importance of cryptocurrency to global economy (Read 186 times)

Digital currency isn't only limited to cryptocurrency, but digital fiat in paypal and the new currency run in blockchain e.g. CBDC is also a digital currency. Bank do really support those digital currency because the price is pegged with the fiat money, but for digital currency like Bitcoin where the volatility is high, they're scared to accept it and doesn't have a way to control the price.

Central banks are based on producing fiat money within controls and according to a corresponding stock of metals such as gold, or a reserve of major currencies such as the US dollar.
As for cryptocurrencies, they are not subject to any controls of any kind and are produced by individuals (mining). However, some countries that are subject to economic crisis's or international sanctions have exploited these digital currencies and used them in their favor within controls ; The Venezuelan government issued a central digital currency called "Petro" and linked its price to the price of a barrel of local oil which means linked it to oil and precious metals. Also, China has also issued the Chinese yuan, which is a digital currency different from the decentralized blockchain.

Here's another: zero economic damage from central banking mistakes. The only entity in the world that affects the entire economy when it does a mistake is the one that controls the currency. If you remove this monopolistic central point of failure, you don't have those bad consequences-- which ironically and in contrast with the rest of the economy, aren't paid by the entity's heads, but by the rest of the world.

Apart from the fact the this topic is discussed continually, I have never seen eminently the importance of cryptocurrency to the larger economy. It is more of importance to the individuals that a country as a whole.
It is had to see that a struggling country is being financially liberated by bitcoin. Maybe we wait and see the fate of El Salvador after 2024 bull run. Let us see where bitcoin will place there economy.
Apart from that any country that 100% adopts bitcoin will have issues of increased cyber crime if not regulated.

This has not been taken seriously by global leaders because they don't see its real usage yet as to many negative incident which those officials give attention. That's why most of them are skeptical about its adoption, but its really helpful if they could just adopt it and regulate the platforms around because they can get extra cash from taxes if they just know how properly regulate the platform to avoid more frauds. This is win situation to them and to their people since somehow we can get assurance about what we are trying to do since government presence is there monitoring the platform who want to enter the scene if they are put some good regulation towards its usage on their country.

Bitcoin or cryptocurrency is not a part of the global economy as yet, it is just a digital currency. So far, no country's government has declared this currency as one of its medium of exchange. Therefore, digital currencies should not have any similarity with the global economy. However, digital currency Bitcoin has been able to gain people's trust so far. And maybe people can use this digital currency as a replacement for paper money.

some problems will be solved. but the process of adopting Bitcoin or crypto to solve a country's financial problems certainly requires a lot of preparation.
interested countries may have to look at how El Salvador manages their Bitcoins for its people. yes, they have slumped in the economy and tried to get up with Bitcoin. it all did not go smoothly, there were some problems on their way to adopting Bitcoin. many evaluations from several views of world economic observers regarding the use of Bitcoin as a legal currency used for transactions.

I don't think that can work because of all the other fees involved.

When an "immigrant worker" is working in another country, they are being paid in the fiat currency of that country. In order to send bitcoin back home they first have to convert that money to bitcoin which requires a bank transfer to the exchange (fee #1), buying bitcoin with that money (fee #2) then withdrawing those bitcoins from their exchange (fee #3) then transferring those bitcoins back home (fee #4) and back home they have to do all that in reverse meaning to exchange those bitcoins to their local currency in an exchange (fee #5) then withdraw the fiat from that exchange (fee #6).

So we already have 6 extra costs and only the #4 is cheap (bitcoin tx fees) but the rest can be expensive specially the exchange related ones that you may even end up losing money due to volatility.

The topic is not something new in this forum, it has been discussed several times, and we do understand that you are new to this so for the sake of it I'll provide some realistic answers.

As of now cryptocurrency is still too far from becoming a mainstream or even an alternate payment system;

1. Internet Connection - This alone is already a huge hurdle to tackle and up until now most of the 3rd world countries doesn't have stable access to internet.

2. Education - Even if we say that 70% or 80% of the population is financially literate, trying and implementing cryptocurrency to most of the people would also be a huge problem. As you have also known that in order to access cryptocurrency and use it, there are several steps like registering and knowing which and what kind of crypto they'd be doing transactions, and in short it is quite complicated to understand at the very beginning. It's true that it takes time to be able to understand those things, but as of now, there is not enough facility to accommodate those kinds of education and even if you are lucky enough to have one on your area, for sure there are only few people that are interested on those things (one reason is that they rely on the traditional payment system which much more easier to understand).

Summary: I could say this based on what's currently happening on my own country. Even if the benefits are great, crypto will always be far from those famous hype way back years ago which is "Cashless Society".

Cryptocurrency is not a part of global economy so I am sure it has yet been important for global economoy.

Why do you think it is important for global economy with many altcoin projects can be created from the air, tokens mint from the air and after a few months, they die like has never existed.

We have to not blame the people who live on problems. because it's all past mistakes made by the invaders that take they natural resources, and now they live in the remains resources which is almost lost and very difficult to process to make money. Now, the invader use the another strategy to take the remain, by giving them a lot of debt, after broke, the invader make that country impend above on their fiat.

You only take the last part of the crypto transaction process as if it only takes one click.
If the use case is like no.1, it will take several processes because immigrant workers generally get their salary in fiat, one of which is dealing with local banks, risking when converting fiat to crypto via the p2p market. Then the transaction within seconds is impossible.

You are a good thinker, but you lack reconsiderations on the repercussions of this whole idea; what' if you've got friends and families that you really need to send some funds for upkeep, and they all aren't really cryptographically learned?? How would they go about the processes and everything? Most especially our old parents in remote areas or something?? Hmmm... You shoulda thought well.
Secondly, crypto has already made enough impact to have been allowed an opportunity to become a means of exchange, but that isn't simply guaranteed just yet as some criterions doesn't even make 'em look like one. So how did you conceive the idea of using it as a normal token someday? Understand this; Fiat can do well on its own, but crypto cannot...why?? Cus the former is GENERALLY acceptable while the later is not.
Edit:I'm not against what you said, I'm against the fact that you hid so many truth just to paint it white.

Sandra 🧑‍🦰

This is just as a making a repetition of what others have always been saying concerning bitcoin or cryptocurrency, I understand that you're a newbie but don't you think you need more time to grow and discover more relevant aspects that could drive interest for discussion by other members, during this period you would have got yourself also equiped well enough to deliver up to expectations, just my opinion anyway.

1. Remittance Industry : years to come cryptocurrency can have a major impact on the traditional remittance Industry as the number of immigrant workers rises, the problems in sending money to families at home also increases. The traditional system of sending money is expensive and it also takes alot of time. Cryptocurrency offers a seamless alternative to those traditional problems with a lot more transparency, lower costs and faster transfer times. So there's a high possiblity of immigrants shifting towards cryptocurrency for making money transfers to their love ones at home
2. Easy to use and Fast : we all know that transferring funds traditionally involves some hassle and can take some time as well. although there are many applications in the market now that offer easy digital find transfers there are still several restrictions but in the case of cryptocurrency, there is no such restrictions and no involvement of any regulatory bodies, which means people can shift towards dealing in cryptocurrency for the value of money that they would otherwise transfer.moreover, these cryptocurrency transactions can be done within seconds, unlike traditional money transfers which take some time.
3. Great for countries with poor financial systems : many developing countries face problems related to under developed banking and financial systems. This cause a lot of problems when it comes to interests, loans and overall money management. Frustrated by such problems, many people resort to dangerous and unlawful methods of money management. This entire chunk of the problem can be taken away with the introduction of cryptocurrency. They would provide fast and easy transactions that are decentralized and hence technically boundless to any border whatsoever. Digital money can serve as a very strong foundation for an entirely new digital alternative to traditional currencies that the world currently relies upon.