Money is the most used medium of exchange (MOE). It’s interesting to learn that 50% of all transactions across the globe involve money. But what’s not being talked about a lot is the fact that governments are responsible for deriving, considering, and instituting this money. Also referred to as fiat, paper notes are viewed by the public as a given, an inevitable part of daily life, and self-evident. But cryptocurrency now challenges these very notions, particularly Bitcoin. Serving as a peer-to-peer electronic payment system, Bitcoin is geared up to address the many downsides that come with using government money.
How the Government Controls Money
If you’re new to cryptocurrency, there’s a good chance that you’re also new to thinking about the role the government plays in circulating money and how much value it holds. It’s thrilling for investors to think of how they can convert cash into digital coins which have the potential to increase in value over time. These digital coins can be had either in full or infractions, and despite the wild swings in prices, the earning potential can prove to be much higher than traditional investment vehicles.
It’s important to note that Bitcoin is anything but a get-rich-quick scheme. Despite what many people would have you believe, investing in cryptocurrency can damage your financial health if you’re not careful. This applies to new cryptocurrencies that seem to vanish into thin air after its Initial Coin Offering (ICO). Wise crypto investors do their research, perform technical analysis, and leverage powerful trading platforms such as Bitcoin Loophole to increase the odds of earning in the cryptocurrency market.
The extreme volatility in the market, however, continues to prevent many people from investing their money in crypto. But once you realize that fiat loses value over time, it’s easy to see why you should consider cryptocurrency as a digital store of value for the long-term. You don’t have to hold a degree in economics to understand that something you purchased just a few months ago now costs more. Inflation is to blame, and it hurts the poor and the middle class more evidently than the rich.
Instead of throwing your hands up and accepting that inflation is something you just must live with for the rest of your life, you must realize that the continuous increase in the value of goods and services means you have to work harder just to afford them. Without any increase in income, you’re getting less bang for your buck. This is what happens every year.
But you can’t talk about inflation without talking about the government’s role in it. The government has the sole authority to prosecute, mint, print, and circulate money. That’s not a good thing, considering that something as important as money is being controlled by a single institution. Despite fiat being a universal MOE, it’s clear that it comes with many downsides. With the control politicians have over money, it’s hard to fully trust them for every single transaction you make with those coins and paper notes.
Cryptocurrency to the Rescue
By now, you should have a better understanding of why people shouldn’t feel satisfied with fiat. It’s high time to look at cryptocurrency and how it proves to be the alternative MOE we’ve all been waiting for. Contrary to government money, Bitcoin is permissionless, censorship-resistant, and fully peer-to-peer. There’s no need to worry about banks or any third-party meddling in all your transactions since no central body exists to regulate the market.
But what about inflation? You should know that the inflation rate of Bitcoin is capped at 21 million coins. This means that as more people adopt Bitcoin over time, its relative value increases as well. Bitcoin can be used to trade with other people from all corners of the globe, and no middle persons will interfere with the process.
What’s most interesting is that cryptocurrency trading is open source and transparent. All transactions are added to the “chain” for confirmation purposes, but you remain completely anonymous. This is a huge plus in favor of cryptocurrency since it presents an opportunity to reduce the risk of digital fraud.
While it’s relatively new, Bitcoin has already rewarded early adopters not just in terms of Bitcoin’s value increasing tremendously since its inception, but also in terms of changing the way people think about money. Investors who choose to hold on to their digital coins may see an amazing growth in their wealth in the future, all while teaching the importance of setting cryptocurrencies aside instead of splurging all the cash they have at their disposal.
The reasons to invest in Bitcoin go beyond using it as an MOE or a long-term store of value. More importantly, it allows you to gain full control over your money.
