Finance Technology

Use Cases of Cryptocurrency Today

Welcome to the future, today. While many people are still skeptical about cryptocurrencies, some people are already experiencing and using the future of money.

Traditional paper money

Traditional money such as paper money will one day become obsolete. To pay someone, you will have to physically carry paper money. The more you need to pay, the heavier it gets. Up to a certain limit, it becomes a security risk, as you could get robbed if someone notices you carrying a large amount of paper money.

Other than that, you will have to transfer paper money physically to another person. It is bounded by geographic location and not easily sent to other countries for example.

On top of that, with the recent spread of virus, paper money can be a source of spreading illnesses. Paper money gets exchanged frequently, does not matter if you are buying fish from the wet market or buying jewelries at a mall, it gets passed from one person to another, without ever being cleaned.

Paper money fraud

With the advancement in technology and knowledge, some people have been able to create high grade counterfeit money and have been circulated in the system.

Digital money and credit cards

In most countries, people are relying more on digital cash or credit cards than physical money. This is due to the convenience of paying someone without having to physically carry a heavy load of paper money.

However, with these digital forms of money, they are also limitations. You can spend in most places locally easily, but there are certain restrictions that you have to follow.

Take for example, if you wish to pay for someone in another country, your bank may restrict access and reject your transaction. Take also into consideration, the unfair foreign exchange and banking fees on top of your transaction. There are many instances whereby your bank refuse to allow payments to certain companies with the disguise that they are protecting you from fraud.

These digital form of paper money has limitations. That they are centrally controlled. It is as if, they decide where you can spend and where you cannot spend your money. It is as if, they are really the owner of your money, and you are not the rightful owner.

Come cryptocurrencies today

As more and more people become aware of the limitations of existing money system and the fraudulent system of the whole monetary supply, more people turn to cryptocurrencies.

With cryptocurrencies, and the correct knowledge to protect one’s own funds, it definitely make more financial sense to embrace cryptocurrency and abandon traditional paper money and restrictive digital cash.

Transferring money without borders

With cryptocurrencies today, you can send money to anyone anywhere in the world. With the use of a smartphone and scanning a QR code, money can be transferred from China to Japan or anywhere in the world without requesting for permission from a central authority.

The disadvantages of transferring money digitally from the traditional system is that, money sent is not instantaneous. You will have to wait for a few days and even weeks for a transfer. In addition, you have to pay hefty fees for the transfer. Also, payments can be rejected and you have to provide lengthy proof of source of fund, show your identity card or passport and expose yourself to data privacy risks. And still, get your transfer rejected! And you have to explain what the transfer of fund is used for. Such capital controls imposed is to fight money laundering they said.

With cryptocurrencies, you can transfer money to anyone without having to provide all the personal information and risk having your privacy exposed.

Your money is under your control

Properly kept cryptocurrencies in a hardware wallet is one of the most secure way to keep your funds. It is the Swiss bank account managed only by you. With such powerful control, you also need to equip yourself with knowledge on keeping your cryptocurrencies and hardware wallet safe such as not exposing your recovery seed.

Transferring money via an image (QR code)

People have been able to transfer money just by scanning a QR code posted on the internet. With the QR code of the cryptocurrency wallet address such as Bitcoin, transfers are made instantaneously.

Just point your smartphone camera to the QR code anywhere, shared from a TV, in your WhatsApp group or YouTube videos, money will be transferred easily. No need to worry about what country the other person is living, what bank he is using or what restriction there are such as ineligibility for opening a bank account (for example, declared bankrupt etc).

People have been using QR code to request for donations in cryptocurrencies. Money sent once confirmed in the blockchain cannot be frozen like bank accounts can.

Sending money overseas for tuition fees or working abroad

Many people are currently using cryptocurrencies to transfer money to their children studying overseas for tuition fees. Or even working abroad and having to send money back to their family in their home country.

Traditional banking systems to transfer funds overseas such as Western Union is currently facing a threat from cryptocurrencies to become obsolete. With their high fees and inconvenience, no wonder people use cryptocurrencies today.

Sending money in the dark web

Although some of the use cases are for illegal purposes such as buying drugs or buying hacked accounts online, it is also one of the use cases of cryptocurrencies today.

Due to the nature of cryptocurrencies, with no central authority to restrict who you can or cannot transact with, cryptocurrencies are used everywhere.

Likewise, it is also true that physical cash is also being used to purchase drugs. It is only a form of medium of exchange. For example, people in prisons exchanging goods using cigarettes as a medium of exchange.

Avoiding bank runs

With the current instability in the financial system, people store their wealth in cryptocurrencies so that they know that they money they own is theirs. With traditional money, money kept in the bank is susceptible to lots of limitations. For example, in the event of a bank run, you will not be able to withdraw your own hard earned money! It is your money anyway, why can’t you withdraw them whenever you want?

As countries get more unstable monetarily and politically, there will be a lot of limitations to what you can do to your own money stored in a bank account. For example, limitations such as you can only withdraw a certain amount of money per day from the ATM, makes you feel like the money in your bank account is not really yours. It is like you do not have total control over your own money.

Paper money is phasing out

As more and more countries promote the use of digital cash, paper money is becoming obsolete. Countries want to be able to track their citizens purchases. Who buy what. Who transact with what, and how much.

Moreover with inflation, countries cannot cope with the rate of printing more money into the circulation. With the stroke of a keystroke, money is created digitally in the computer. So it comes naturally that the use of paper money will be extinct in the near future.

Just like newspapers, home phones and fax machines, as people find easier and better ways to improve their life, they will abandon old forms of technologies.

Micro transactions and games

Yes, people are now able to pay $0.00001 via cryptocurrencies, which is not a possibility in traditional financial systems. For example, pay to view or read a blog post via bitcoin lightning transaction.

Online casinos are using cryptocurrencies for gambling. People can deposit and withdraw via cryptocurrencies easily without having to transfer money via a bank, which will take days and have their transfer rejected.

Other than casinos, some game developers have come out with a brilliant way to allow purchase of in-game accessories via cryptocurrencies. For example, if you want to level-up your game character without spending a lot of time training the character, you can pay via cryptocurrency.

Yes, these are already happening today, not in the future.

Future of cryptocurrency

It is hard to predict the future. As integration of technologies happen, things that we never imagine today will become a norm in the future. Take for example, self driving cars which we have never even imagined back in the days we ride horses and have no cars.

Imagine in the future, as we have 5G in the present and 6G in the future, we can already stream everything with a smartphone. The future is limitless. Also with the advancement of artificial intelligence, everything integrated, the future is definitely interesting.

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