Here Is The Most Promising Cryptocurrency With Higher Returns In 2022?

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The use of money is very old. Its origin is intertwined with that of economic history. Its invention has enabled the development of exchanges, transactions, and commerce in general throughout history.

First fiat (notes, coins) gradually adopted a scriptural form which is largely in the majority today. This evolution has accelerated under the effect of technological progress, smart card, the internet, smartphone, etc.

After half a century of regulatory strengthening and centralization of the powers of monetary authorities, the desire to reclaim control of the currency has led to the emergence of crypto-currencies.

The purpose of this article is to demonstrate, based on historical analysis, that the evolution of money continues and that the next step will be that of crypto-currencies. First fiat, then scriptural, it will become cryptographic.

First of all, crypto-currencies eliminate intermediaries during transactions. The processing time for a money transfer no longer depends on the value date mechanism imposed by the banks.

Second, blockchain provides an effective defense against fraud, as ledger entries cannot be changed once processed. It comes in the form of a database in which you can find the history of exchanges that have been made since it was opened. Moreover, this database is shared by the members of the blockchain without any intermediary.

This decentralization makes transactions inviolable. Thanks to this, each member of the network can check the validity of the chain. However, the system remains vulnerable to certain cases of fraud and hacking such as the 51% attack or the social engineering techniques used by hackers.

In the international financial system, economic aberrations persist where a currency loses its value by leaving its national borders. The Nigerian naira is a perfect example: its value drops by 30% as soon as it leaves Nigeria. Digital currencies, for the most part, are not issued by a nation or state and therefore are not subject to the same geographic fluctuations or political influences.

It is noted that technological progress does not modify the use and the fundamental role of the means of payment, but brings advantages such as confidence, security, traceability, and speed.

However, computerization has greatly favored the development of the scriptural form by causing its dematerialization. Databases have in fact replaced books of accounts, thus reducing the processing of checks and cash deemed cumbersome and costly by banks.

The methods of payment become simple modes of circulation of information that correspond to transfers of purchasing power with better traceability.

The technological revolution has brought a gain of security in the means of payment by limiting the risks of counterfeiting and thus facilitating the mission of user protection reinforced by the legislator.

If nothing is simple or consensual with money, let us at least conclude this: it seems just as primordial and powerful as it is unthought and misunderstood by citizens. Social convention, simple belief, or collective psychological construction, money nevertheless takes on the appearance of inevitability in the eyes of the greatest number.

A received idea that offers a striking contrast with the plethora of alternatives, even models of different societies that are open to supporters of monetary reforms. The control of the currency is a condition of real change. Getting the subject out of citizen indifference would now be the first step.

Both currencies have no intrinsic value. Their value is the result of user trust; placed in the State and Central Banks for fiat currency, placed in the blockchain system, and validation consensus for cryptocurrency.

Fiat currency is centralized — issued and controlled by third parties, while cryptocurrency is decentralized — transactions are peer-to-peer.

Cryptocurrencies exist in limited quantities, while fiat currencies can be issued at will. Bitcoin, for example, is limited to 21 million units. This fundamental difference explains the deflationary aspect of cryptocurrencies and the inflationary aspect of fiat currencies.

Fiat currency is considered less secure than cryptocurrency. It is indeed sensitive to virtual attacks aimed at collecting banking data. In addition, fiat currency is always vulnerable to theft and robbery. Conversely, the cryptocurrency system is supposed to be perfectly inviolable.

The speed of transactions is significantly different between the two currencies: a fiat currency transaction will take 2 to 3 days to be validated between two banks, while a Bitcoin transaction will only take 10 minutes.

Cryptocurrency and fiat currency, therefore, diverge in many aspects, the former having been created by Satoshi Nakamoto in response to the flaws inherent in the latter. Degree of centralization, level of security, inflationary or deflationary aspect.

Each has its advantages and disadvantages, and each has its supporters and detractors. Only the future will tell how important cryptocurrencies will be in the global economy compared to fiat currencies, which are the majority today.

Cryptocurrencies are expected to emerge as the new form of transaction usage and be widely adopted. Financial institutions and governments are concerned about this proliferation. Some states, such as Sweden, are already developing their own alternative currencies.

Among the priority investment areas (DIA) presented in the finance innovation cluster’s white paper published in February 2019, DIA talks about the creation of a eurozone-specific crypto-euro for wholesale payment and detail.

Evolution is part of the historical perspective and seems irreversible. This means that the cryptocurrencies of the future will certainly exist on the terms of central banks, financial institutions, and government agencies.

Disclaimer: The information provided in this article is solely the author’s opinion and not investment advice — it is provided for educational purposes only. By using this, you agree that the information does not constitute any investment or financial instructions. Do conduct your own research and reach out to financial advisors before making any investment decisions.



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