Over several years since the emergence of computers, businesses have operated in traditional financial market. The investors in traditional markets have enjoyed benefits like being protected from fraud and also been compensated incase a loss occurs. However there have been various challenges when it comes to paying for bills globally and also in foreign exchange having to consume time when one is moving from a certain place to access a financial institution hence delays in sending or receiving money.
The traditional financial market is centralized. The government and different banks manage the physical currency hence regulating it and ensuring that it does not attract criminal activities. Most developing countries take after the developed countries and in the case of adopting the physical currency just like the developed countries had adopted its use then they also followed the suit. An example is when the United States traditional financial market was a hype then most countries in Africa also adopted the physical currency as a medium of exchange. Over years now the developing countries have also begun to adopted the digital currency market for transactions and so as to gain benefits like the people in developed countries.
Cryptocurrency has been adopted as a medium of exchange by different investors in different countries in Africa. Due to presence of high technology and innovations investors have joined the digital currency market and there is no doubt that it is overcoming the traditional financial market. Covid 19 pandemic came along with the effects of lockdown and during this period, people traded through their mobile phones hence the digital currency market gained fame in its ease of use.
Many investors have gotten plight on how cryptocurrency works and therefore they have adopted various ways of trading abandoning the traditional ways of trade. In many businesses, the owners have allowed their customers a chance of shopping online. This has been as easy way of accessing goods at the door steps and with the crypto wallets, they have been able to make payments through the online networks direct to the companies.
Despite the rapid growth in the use of cryptocurrency, it is important for the investors to note that in most cases the digital currency market is not regulated and it is associated with various risks like frauds and criminal activities that could result to loss. Being unregulated by the government, there could be claims that are not true and the investors who do not know how crypto works might end trusting into false claims.
Africa should adopt the United Kingdoms’ idea of having all advertisements on cryptocurrency meeting certain specific standards so as to protect their investors from claims that could be misleading. In many attempts, people have tried to duplicate the physical cash making it resemble the real cash when it’s a duplicate copy of it. Those who are conned using the duplicate money undergo loss and, in many cases, they do not recover from it because by the time it is realized there could be no help at the moment. It is hard to duplicate the cryptocurrency for it exists in an unduplicable nature.
It is the nature of human beings to be attracted to profits that come along easily as they all wish to go for shortcuts. Cryptocurrency is decentralized and it allows peer to peer transactions to operate even on mobile phones with lower transaction costs. These benefits in the digital currency market have led to boom growth since many investors have been drawn to cryptocurrency so as to earn the profits in its market despite the fact that it is unregulated and prone to attracting criminal activities. Digital currency can be divided up to eight decimals while the physical currency only allows for division up to two decimals. This prioritizes the Bitcoin to be of more benefit than the traditional currency.
Both traditional financial market and the digital currency market are all mediums of exchange but cryptocurrency has been seen as a medium of exchange that can support a universal income. Cryptocurrency has also helped in reducing intermediaries that are involved during transactions in the Traditional financial market having to cost more to accesses one owns’ money and thus helping the consumers gain more for the transactions occur from a peer to a peer.
A number of people in years before crypto would not access trade due to some limiting factors such as failure to own a bank account but with the cryptocurrency then a greater number has been able to access trade and grow from poverty. It is suggested that regulation in the digital currency market is coming and it will make it more legit and give the investors a feeling of