Cryptocurrency critics continue to highlight some of the most important flaws with decentralized digital money, but although they are right in the short-term, in reality, cryptocurrencies can have a meaningful impact long-term. We already know why you should trade cryptocurrencies in 2020, so today we’ll switch our attention for the longer future.
People fail to understand that cryptocurrencies don’t necessarily need to replace the money we had. Their applications in the economy are endless. Tokenization is one of the trends with the highest potential right now, due to its advantages over the current outdated methods. Tokens can be used in combination with smart contracts, or in order to track certain products from the factory to the final client. We must understand that cryptocurrencies represent just a small piece of a broader digitalization process.
Alternative to government centralization
Whether we live in a Western country or in the East, we are trapped in a centralized government that takes all the important decisions, even though some people can be affected. Cryptocurrencies represent a tool that can break this monopoly and provide a decentralized solution, both from an economic and political point of view. Centralized power eventually leads to wealth inequality and fewer opportunities for the middle class. In the long run, cryptocurrencies are able to be part of a big decentralization process, that will unfold over the next decade.
Will Bitcoin manage to reshape the world we live in? That’s hard to call, but in its current shape, we believe the chances are limited. However, Bitcoin and other altcoins have changed since their inception up until now, and the entire industry will continue to do so. Now don’t get us wrong, cryptocurrencies won’t save the world but can be a piece of a broader change.
New banking model
People hate banks and they have serious reasons to do so, but the blockchain technology can make the entire banking system more transparent and worthy of trust. As long as people will be able to constantly track the money they’ve deposited at a bank, there won’t be any reason to have any doubts.
Will this change happen overnight? No. But we already see plenty of big banks testing blockchain solutions and as time goes by, the trend is expected to accelerate. Areas like cross-border payments had left behind and are behind the latest technological developments, meaning the blockchain and cryptocurrencies could be tools to make a difference.