Bitcoin has been a hot topic for over a decade, but not many people expected it to be as massive as it was in recent years.
Depending on whom you talk to, there are numerous reasons for the appeal of Bitcoin.
From its decentralised nature to its distinct peer-to-peer mechanism, Bitcoin has revolutionised the way finance and currency have been understood for generations.
That said, a lot of people still hold misguided ideas of the reality behind Bitcoin. They think of it as a simple hash or algorithm that people overvalue—but that’s simply not the case.
Bitcoin is a big step forward in the way we think about money and finance. Let’s look into some of the ways Bitcoin has changed how we think about money.
1) Bitcoin Redefined The Meaning of Ownership
If you’re transacting in large sums of fiat currency, a middleman is often involved to help you facilitate the transaction.
For instance, transferring cash from your checking account to another bank account would require you to use the services of a bank.
Upon using their service, the bank or financial institution often takes a percentage or a cut from the transaction.
While the rates are often minimal, they can add up, especially if it’s a percent-based scheme.
While you can technically carry your wads of cash with you to facilitate a transaction for free, it’s not the most practical thing to do, nor is it the safest.
But with Bitcoin, the concept of ownership has been abruptly redefined. Central financial authorities are no longer a necessity in the transaction process, allowing users to transact with greater autonomy.
2) Bitcoin Shaped Technological Infrastructure
Bitcoin is at the heart of a new wave of technologies, such as blockchain and smart contracts.
Blockchain technology is what makes Bitcoin possible, acting as a distributed ledger of all transactions in the network. This blockchain can be used in multiple ways.
One of the most famous ways it’s used is for the development of smart contracts, enabling different parties to have complex and automated exchanges.
Technology is a modern-day advancement that seeps across multiple industries.
This means that Bitcoin and its related technologies aren’t only going to be felt within the technological world, but it’ll also have a huge impact on societal, financial, and medical fronts.
Furthermore, while it doesn’t natively run it, Bitcoin’s development has paved the way for the creation of other cryptocurrencies and, consequently, non-fungible tokens (NFTs).
NFTs provide a bedrock for creating digital, one-of-a-kind assets—something that the world has never seen until now.
3) Bitcoin Made Paying Across Borders Easier
Sending money from country to country takes a long time, incurs huge fees, or does both.
Some countries also have government restrictions that prohibit them from sending large sums of money to regions.
That’s countered by the existence of Bitcoin and other cryptocurrencies. With Bitcoin, you can send large amounts of money anywhere in the world with very low fees and fast transaction times.
You don’t have to wait for days to receive the money, all you have to do is type in the wallet of the intended recipient and the amount of Bitcoin you want to send. After clicking send, you’re pretty much set!
As a direct result of this revolutionary cross-border payment method, Bitcoin has spawned a new economy of businesses and talent.
This grants opportunities for people to earn a living and for businesses to acquire staff to provide value, whether it’s for their local communities or the world at large.
4) Bitcoin Transactions Are Traceable
Bitcoin transactions are all submitted and recorded in a public ledger that anyone can view.
This makes Bitcoin transactions highly traceable, which is great for accountability and derisking high-value and vulnerable transactions.
This traceability allows users to verify and audit who they’re dealing with before the moment of the transaction, which is great for instilling confidence.
While there are many cryptocurrency scams people need to know, the ability to trace and monitor the transactions of a person adds a much-needed layer of assurance and security.
5) Bitcoin Ushered In A New Investing Method
While paper stocks have been around for generations, Bitcoin’s growth rate (as well as other high-performing cryptocurrencies) has been significantly faster since its existence.
This high growth rate has presented an opportunity for investors to generate huge returns on their initial investments.
While many would say that it’s too late to ride the tide of Bitcoin nowadays, there’s no doubting the historical returns it has generated for early investors.
Furthermore, the meteoric rise of Bitcoin has also brought about the existence of various Bitcoin exchange marketplaces.
These exchanges make it easier for the average person to access and buy and sell cryptocurrencies, thus involving themselves and potentially benefitting from the ensuing market movements.
6) Bitcoin Presents Stability In Unstable Territories
The geopolitical climate of a country is in a constant state of flux. And while we may be enjoying political stability at this time, there’s no telling when things can go south. And if it does, it can go downhill fast.
Whenever a country’s status quo is shaken, it can have disastrous repercussions on its fiat currency.
For instance, Venezuela’s Bolivar has suffered economic collapse and rampant hyperinflation for years now.
This shows Bitcoin’s potential as a haven in unfavorable economic climates.