Cryptocurrencies are likely to be one of the biggest and most lasting innovations to have come in the last decade or so.
Even though most people have only become aware of the existence of cryptocurrencies in the last 12 months, due to Bitcoin’s rise from $5,000 to $45,000, cryptocurrencies have been around for quite some time, with Bitcoin being created all the way back in 2009, for example.
Cryptocurrencies had largely been considered a niche area, with very few people in mainstream industries showing any interest. However, this has all changed in 2020, especially due to Bitcoin’s rally, and many more people are now considering crypto as an investment option. This has also led to more research and data being published on blockchain, which is the underlying technology for cryptocurrencies, and the various benefits and uses it can have.
In this regard, Ethereum is the leader, with the Ether blockchain being used for supporting transactions and other applications, while Ethereum is the second-largest crypto in the world after Bitcoin in terms of market capitalization. There are many who believe that the true impact of cryptocurrencies will be seen through the adoption of blockchain, as this technology has the potential to transform various industries and sectors all over the world.
Blockchain is basically a decentralized network, where data is stored on a distributed ledger, and so it is not stored in one central location. This makes it easy for users on the network to validate and confirm transactions, without having to rely on a central institution. Blockchain allows financial transactions to take place, for example, without the need for a bank, while the records that are stored on the network can be viewed by any entity that is on it, making it extremely transparent, and therefore reliable.
Transaction fees are also lower as a result, which is why such networks have found popularity in terms of supporting financial transactions. Users are also anonymous on blockchain networks, while transactions are virtually fraud-proof, both of which have proved to be very attractive features as well. All of these features show why blockchain networks are being adopted by more and more businesses, and we can expect to see this trend continue as cryptocurrencies continue to become a part of mainstream finance.
Blockchain is also being used for much larger purposes, such as supporting public sector and multinational operations. The United Nations, for example, is working on a project to use blockchain networks to create secure voting platforms, while the United Arab Emirates is testing the use of blockchain to improve the operations of its central bank. Blockchain is being used to improve the efficiency of shipping companies, as it can provide end-to-end tracking of goods and services on a decentralized platform. These are just a few examples of how this technology is already changing the way several entities operate, and we can expect to see more of this as cryptocurrencies become more popular and therefore more people learn about the advantages that blockchain provides.