You've undoubtedly heard of the recent bitcoin boom that almost overnight brought cryptocurrency into the spotlight. With investments in cryptocurrencies soaring, it’s no surprise that it has spiked the interest of many.
What is a cryptocurrency?
Cryptocurrency is a virtual currency which conducts transactions with the exchange of digital information. Bitcoin was a centralised cryptocurrency which was a first of its kind. This caused many others like Ethereum, ripple, etc. to follow suit and take a piece of the action. With bitcoin's tremendous success and its continuing momentum, there has never been a riper time to invest in digital cash.
Are you intrigued yet? Are you considering dipping your toes into the realm of digital cash and testing the waters? If you are, here are seven reasons to convince you to leap.
A natural inhibition for many exploring cryptocurrencies is the security that it offers. Many assume that since it is done on a digital platform, it would be prone to hacking. If you were fearful about this too, there is no need to worry.
Did You Know? Digital currencies use cryptography to make the transactions and the digital information secure. So, you don't have to be worried about counterfeits. It is complicated, if not impossible, to make a forgery of digital currency; hence, your fortune remains yours! Encrypted records of ownership allow for legitimate and accurate record-keeping.
Digital transactions are encrypted using blockchain technology. This ensures that the exact amount that you want to send is transferred from your digital wallet, leaving no room for third-party intervention. The smart contracts used to secure the transactions also protect the currency from being hacked.
Did You Know? Each time you make a transaction, the blockchain technology confirms the ownership of the digital currency to make sure that the person owning them is the one spending them.
The transactions can be made instantly using your mobile wallets on your smartphone, from just about anywhere in the world. Gone are the days when paperwork and waiting period for transactions was the norm. Paperless transactions and investments have already become the trend, and it is only a matter of time when digital cash takes over. The trend of digital payments and digital cash is right in tune with our need to get everything done by using the tip of our fingers.
Did You Know? Over 30% millennials are considering investing in cryptocurrency?
You may have heard that there are only a certain number of specific cryptocurrency. In the case of bitcoins that number is 21 million. The rising value, paired with the limited supply, is pushing the value of bitcoin even higher. The gap in the demand and supply is adding more fuel to this fire. A similar trend is picking up for all the other cryptocurrencies, making them an expanding gold mine. Investing in digital cash can give you a very comfortable financial cushion to fall on in the future.
Did You Know? A single bitcoin will be worth ten times its current value, ten years from now!
You must have noticed a majority of individuals making a shift to digital transactions and other digital modes of payments. This is probably because the costs for transactions are quite low compared to typical transactions. Also, online exchange platforms for cryptocurrencies offer free transactions adding icing to the cake.
Did You Know? As there is no third party involved in the cryptocurrency transactions, and because the government cannot impact them or regulate them, there is no viable taxation system that can be used. This means that you may, after all, be able to avoid hefty taxes!
The rising popularity of cryptocurrencies has brought in more options of paperless payments to you. The Indian government has introduced the UPI (United Payments Interface), which aims at linking all your bank accounts into one mobile app to provide you with seamless banking experience.
Kotak 811 is another futuristic digital banking ecosystem, which allows you to have your bank in your pocket, with a zero-balance account. Cashless has moved beyond cards and manifested as virtual debit cards that can be used right from your phones with this app.
Did You Know? You can use the scan and pay option for Kotak 811 account to make payments. Time to ditch that wallet after all!
Many countries are considering the possibility of providing legal tender to cryptocurrencies. If this comes to pass, there is no stopping the reach of digital currency.
Cryptocurrency’s Impact in the Country
Although India recently announced that cryptocurrencies like bitcoin are not legal tender, the digital impact is India cannot be overlooked.
The demonetization drive in India, when Prime Minister Narendra Modi pulled back specific currency notes from circulation, also served as a move to help Indians switch to digital payment methods. This also drove many Indians to make a shift to cryptocurrency in a bid to secure their funds. This saw a spike in the trading volume of cryptocurrency like never and established the real possibility of its widespread use in India.
Did You Know? India's very own cryptocurrency called Laxmicoin has been awaiting approval from the government to launch in the country.
A committee is currently examining the pros and cons of trading on digital platforms so that you can hope for India's definite stand on the matter soon enough.
The benefits of cryptocurrency may easily outweigh the possible fears that it comes with owing to the reasons mentioned above. Digital cash may be a relatively unexplored area by many, but it hasn’t limited its reach or its popularity with the ones who’ve been following it for a long time now.
The use of blockchain technology and the overall security that the process offers undoubtedly makes it interesting enough for everyone to take a bite of the excitement around it. If you have been considering it yourself, there is no better time to get savings into the right channel of investment.