Trading using fiat currency has had several challenges, but over the years, it has been the only medium of exchange available and people have had to bear the challenges and try to make the best out of them so as to maximize their profits. Some challenges have made it next to impossible to contribute to the growth of an economy. At that moment, pandemics like the corona virus pandemic that struck globally made it so difficult to grow economically since many people lost jobs and could not find any other at that moment had had to remain job seekers, therefore contributing less to developing the economy.
Physical currency has always had a problem with corruption and poor governance. Transacting in the traditional financial market requires intermediaries, and some may be corrupt, causing investors to lose some of their investments. It may be costly to transact since each transaction has its own cost incurred. Whenever there is poor governance, money gets lost in ways that people cannot account for and some cannot be recovered. Inadequate support from the government has made some businesses deteriorate because some fail to sustain themselves while others lack the capital to engage in business. The infrastructure may be unfavorable to helping in the transportation of goods, and this has led to wastage. Duplication of money has also been a challenge with fiat currency. The labor market has also been faced with the problem of technology advancement, whereby the availability of machines that can perform nearly everything in the industry has left many jobless.
The digital currency market has been seen as a problem solver for some of the problems that are faced in the traditional financial market. Being money that runs through the internet, it is a peer-to-peer transaction with no intermediaries involved, and therefore the cost incurred is very little and at times there is no cost incurred. Adoption of the digital currency market can help pull people from their poverty levels because it allows people in developing countries to purchase currency at no fee. Cryptocurrency is also efficient: no time is consumed for an investor to make or receive any payment.
Cryptocurrency is seen as an investment tool as well as a way to ensure that transactions are discernible. Its transactions are recorded on a digital ledger, and this helps ensure that no corruption is involved and any human error that may occur is not made. Bitcoin exists in exact logarithms and is not susceptible to corruption.In a case where the government prints more money, the value of money depreciates, and goods are sold at a high cost. There has been a problem when it comes to the limitations of owning an account by people in Africa, but with crypto, it becomes easy for them to send back money to Africa.
In conclusion, the continued adoption of cryptocurrency has enabled the solution of different problems encountered by investors in the traditional financial market. It has ensured transparency, efficiency and has also reduced the time that is consumed with physical currency transactions. Being unduplicable is seen as a security measure in the digital currency market.
