Cryptocurrency to be the Guaranteed Gold Rush of 21st Century

The introduction of cryptocurrency gave rise to Bitcoin (BTC)and other digital currencies. The 2008 financial crisis mandated a necessity that should create a more secured financial payment system. A currency that is cryptographically secured, which is based on peer-peer electronic payment system, and that is open. A financial payment system that has resistance to governments interference not necessarily regulations. The financial crash of 2008 reverberated globally making the U.S stock market to crash and it lost $7.4Billion in a single day. The global economy got diminished by $2Trillion. Cryptocurrency rode on the power of blockchain technology. The first cryptocurrency which is Bitcoin began trading July 2010 at a value of $0.0008, and it rose to $0.08 by 31^st of July 2010. It was flat for 3years until it spiked to $250, April 2013.

The new currency requires a measurement system using units called millibitcoins (mBTC), according to Satoshi Nakamoto. By Dec 2013 a Bitcoin was trading for $1,164, between 2014 and 2015 it troughed to $245 by October 2015. 2020 brought a growth dimension to cryptocurrency market; it grew to an exponential rate of 15,000% due to Covid-19 pandemic. 2021 cemented the dominance of cryptocurrency to the peak of 45,000% rate led by Bitcoin (BTC). Gold, the nearest asset to Bitcoin (BTC) has grown to the peak of 642% at the price value of ($2,060). The electronic payment system which cryptocurrency brought is based on cryptographic proof instead of trust allowing two parties to transact with each other without the need of a trusted third party which could be government backed institutions.

The blockchain model is a list of data records that works as a decentralized digital ledger. The data is organized into blocks, which are chronologically patterned and protected by cryptography. The first cryptocurrency mined by Satoshi Nakamoto was used to record a cryptocurrency transaction. The oldest, safest, and largest blockchain network is Bitcoin which was designed with a careful and thorough mixture of cryptography and game theory. Cryptocurrency birthed a digital mint that checks every transaction for fraud and double spending. After the success of Bitcoin (BTC), came the open source cyptocurrency movement called Decentralized Finance (DeFi).  DeFi brought an open-source, unrestrained, and accountable financial service ecosystem that is permissible to anybody without any control. The users shall enjoy unfettered autonomy through peer-to-peer (P2P) and decentralized applications (dapps). The central advantage of DeFi is the simple approach to financial services, mainly for users who are secluded from the authorized financial system.

The wealth cryptocurrency brought came with high volatility and risks making central authorities to doubt its financial efficacy. Major of the fears of cryptocurrency is 51% attack which occurred Jan 8, 2019 to Ethereum classics when researchers from crypto exchange Gate.io announced an established case of the crypto assets by publishing the result of their detections. All assets that have returns carry with them certain risks which are not peculiar to cryptocurrency. Financial experts and leading economists have not hidden their displeasure to the boom of cryptocurrency giving instancing of previous financial havocs that happened in the past. This indication is worth contextualizing but the financial mishap that happened in the past occurred due to lack of financial transparency. Transparency and accountability is the cornerstone of cryptocurrency.

 Major financial institutions have started supporting crypto assets like Fidelity Investments, JP Morgan, and PayPal. Regardless of the skepticism around crypto assets the growth has been remarkable and rewarding for investors. The increased fame of crypto assets came from the flaws of central financial institutions. Investors sought for particular financial assets that carry little central control with strong people’s regulation. A regulation that is determined by people and transparent. The driver of crypto assets success is transparency. The financial innovation cryptocurrency brought is central and open to people’s participation regardless of your income status. The crypto assets movements would have its setbacks but it should be supported by global financial institutions. The financial service the DeFi creation is bringing is all inclusive and accommodating to all players in the economy. The role of the government is not regulation and monitoring but to serve as a financial umpire to penalize any persons that wants to engage in sharp practices. The global economy has witnessed much financial turbulence and concerns are appreciated but must not stifle financial innovation and creativity.

The future for cryptocurrency is promising because more platforms shall start accepting it. The demand for foreign exchange shall diminish. The digital assets shall soon become the standard by governments. More government shall replace their foreign reserves to crypto assets. The grip of World Bank and IMF shall be reduced and fizzle away. The emergence of crypto assets as people’s currency shall dominate the global financial market.