Informative Essay on Cryptocurrency

Informative Essay on Cryptocurrency

Whenever you are doing transactions online or in-store, are you tired of forgetting your credit card somewhere, or being asked to provide your Zip Code or three-digit secure code at the back of your credit card, well say hello to easy, secure, and worldwide transactional means called cryptocurrency that avoid all this. The technologies of cryptocurrency have a major capacity and potential in changing how we do transactions drastically. Even though, the word cryptocurrency start to come to light recently, the history goes back all the way to 1983, when the American cryptographer “David Chaum” introduced and conceived an anonymous “electronic money” called ecash, which he later also implemented “Digicash”. But it was after the first decentralized cryptocurrency, bitcoin, was created in 2009, that cryptocurrency became an internet buzzword and was getting news & media coverage and became well known to most people.

There are many different types of cryptocurrency including Bitcoin, Litecoin, Namecoin, Peercoin, Dogecoin, Gridcoin, Primecoin, Ripple, Nxt, Auroracoin, Dash, NEO, MazaCoin, Monero, NEM, PotCoin, Bitcoin, Verge, Stellar, Vertcoin, Ether, Ethereum Classic, Tether, Zcash, Bitcoin Cash, and EOS.IO.

This is a clear indication that cryptocurrency started to get attention beginning of 2009 and it has been growing & expanding significantly. The majority of its customers feel more freedom, flexibility, ease of access, and enhanced security compared to the traditional banking system. Many cryptocurrency users are located in the United States, Japan, Switzerland, Malta, Estonia, the UK, France, Italy, Germany, and Canada. As the number of cryptocurrency customers grows, the number of companies accepting digital currency or cryptocurrency has also grown significantly including, Overstock.com, EGifter, Newegg, Microsoft, Expedia, PayPal, Shopify, Virgin Galactic, Dish Network, and Wikipedia. The majority of these businesses are accommodating cryptocurrency as part of their online e-commerce transaction. While both Cryptocurrency and traditional banks provide means for customers a way to do transactions online, Cryptocurrency compared to traditional banks provides more flexibility and easy access.

As stated above, cryptocurrency provides more freedom and limited regulation compared to the traditional banking system. “Since cryptocurrency is not governed by exchange and interest rates, transactions are not affected by additional fees. This makes cryptocurrency a primed means to facilitate global transaction without dealing with traditional banking system red taps”. A lower transaction fee is a huge benefit for companies and individuals who deal with international trading, import, and export using cryptocurrency. Also, compared to traditional banking worldwide transaction fees are very minimal. Cryptocurrency comes with great advantages when it comes to anonymity and privacy. Speed is another core feature of cryptocurrency, it operates on a decentralized financial system that is stored via blockchain.

Easy access to financial statements and to perform transactions is key to attracting and winning new customers in this technological era. Cryptocurrency is designed in a way to fulfill this need by allowing its customers to easily access it using handheld devices such as smartphones, tablets, laptops, iPad, and other portable devices. It is believed that there are almost 5 billion people all around the world who have mobile phones and 2.2 billion individuals with access to the Internet, thus is it very critical to be able to reach each customer via mobile phone. In contrast, the traditional banking system has not reached that level yet and most of the time, customers have to carry a banking debit or credit card in order to either access their financial statement or perform a transaction. Cryptocurrencies are accessed on a decentralized network and anyone can earn them, unlike the traditional banking system, one must have bank either a checking or saving account in order to either receive or pay for any good or service.

It is well known that major banks have been a victim of hacking that resulted in the exposure of millions of customers' financial and personal sensitive information. As security is the core component of any financial system, the traditional banking system has to deliver well-proven means or system that protects customers' data from any unauthorized access by any third party. Although, some banks are putting in place further precautionary measures while others are confident of the security of their systems and continue to make all card transactions fully available to their customers. However, as most banking systems are built on outdated technologies it has become increasingly difficult to keep up with the latest sophisticated attacks by hackers targeting customers financial data, and the