Cryptocurrencies have transformed over the last 5 years. We have seen Bitcoin move from a simple beautiful decentralised P2P medium of exchange to a giant complicated money grabbing control freak of a system.
However, the Cryptocurrency space overall has developed into an exciting and reliable industry which has proven its potential to further transform our everyday financial engagements in the near future.
Banks have had to play catch up and only recently been getting involved with Cryptocurrencies on a broader level. At least that’s what it seems in the open. A few years ago banks put majority of their focus and funds on searching for the best Blockchain but what they soon found out was that a Blockchain doesn’t need much attention as each and every Blockchain at its root is basically the same as the Bitcoin Blockchain that was first in existence. But getting the full understanding of this gigantic ledger is a whole new challenge for most.
Banks were left behind with regards to the assets these different Blockchains offer. I believe banks and other financial institutions are only now getting involved in buying Cryptocurrencies through direct and indirect partnerships with exchanges while conveniently facilitating crypto to fiat or fiat to crypto conversions. Many banks have already had a taste of how much profit the crypto industry can generate hence they are becoming more lenient regarding certain aspects of the industry as they see it grow.
Having said that, as we have already witnessed, there are many other larger banks around the globe that have and will continue to place restrictions on the Cryptocurrency ecosystem before they get fully on board. It is important to know that when banks get involved with something, they usually convince all parties to sign up to the same rules and regulations as they follow. Simply because banks are the entity with the biggest power for issuing and purchasing fiat currencies and as you can imagine having this advantage can encourage most people to obey the same rules. Of course this in turn changes the dynamics and can definitely affect the trajectory of the crypto economy. This could even possibly mean “goodbye decentralisation” if we the public, don’t control and take responsibility of this newly found freedom.
In the next 5 years some banks will accept, handle, process and clear Cryptocurrencies, digital assets and manage crypto funds on a much larger scale. There will be some compromise in the relationship between legacy finance and digital finance but with the help of financial technologies I believe digital finance will dominate.
In about 5 years much of the global cash will be removed and replaced by digital and/or crypto currencies. Dedicated crypto banks will emerge and many global payment systems will be reformed. On more individual levels, cashless payments, borderless digital transactions on Micro and possibly Nano scale will be part of our everyday life. We will transact different digital assets, which will include decentralised open source Cryptocurrencies, private monies as well as national digital currencies endorsed by governments.
To talk about the impact of Cryptocurrencies on people’s lives in general be it economically, socially or personally is a very complex topic as it involves so many different levels of change within our selves and the communities we belong to. But what is certain is that the impact will be very positive and definitely outweighs the complexities after we have come to terms with some necessary changes.
The most important changes that we all need to make is believing, accepting, understanding and trusting our self with our own money and the decentralised financial systems that we will operate in. This is something we have not been able to do for hundreds of years.
This is encouraging for a number of reasons, for example having the ability to be in full control of your bank accounts, to be in charge of your own finances, have access to faster, safer, cheaper and more transparent financial system all together. Surely this will have great impact on people’s lives and their financial situation wherever they are in the world.
Unfortunately the topic of money has been vague through out history and in my opinion it has been made to sound much more complicated then it really is. The systems that were running our finances and economies have not proven to be beneficial for everyone and they have made us believe that our personal money is safer with some one else then in our own hands.
Now with digital currencies everyone can take charge and hold them selves responsible for their hard earned money instead of expecting banks to be the custodians of such valuable assets.
In fact, some will go as far as saying that people can be their own bank. Just picture the impact of this and the benefits it would bring to people around the world.
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