The Impact Of Cryptocurrency On The Global Economy

By Soko Directory Team / Published April 14, 2023 | 8:16 am




KEY POINTS

Around 1.7 billion people worldwide lack a bank account and face financial difficulties, often resorting to dangerous lending practices.


Bitcoin

KEY TAKEAWAYS


The number of employment opportunities in the blockchain industry has increased significantly, from just over 1,000 in 2016 to more than 4,000 in 2017.


Cryptocurrencies are virtual currencies that are decentralized and use cryptography to secure transactions. This means that they are not controlled by any government or central authority and are resistant to inflation. However, their exchange rate is highly volatile.

Cryptocurrencies have been a topic of discussion for a while now. They are gaining popularity as a financial asset that is easily accessible and convenient. Digital instruments have the potential to make capital and financial services more accessible, which can contribute to the economic growth of developing countries. Cryptocurrency in Kenya has gained more exposure in recent years as more traders realize the overwhelming advantages of these assets.

Why are cryptocurrencies gaining more popularity?

The traditional financial system can fail if the currency is manipulated, leading to a loss of value and discouraging investors. In times of high inflation, cryptocurrency like Bitcoin can be considered a safe investment. The Covid-19 pandemic caused a significant fall in asset prices, leading to a surge in the popularity of cryptocurrencies as investors searched for alternative assets to protect their wealth and purchasing power.

Investors are betting on cryptocurrency becoming a mainstream asset, with the value of Bitcoin surging eight times since March 2020. The limited supply of cryptocurrencies like Bitcoin has contributed to their increasing popularity among investors who prefer volatility over a one-sided market.

Job Markets

The emergence of cryptocurrency has led to the creation of an entire industry dedicated to overseeing cryptocurrency exchanges globally. Some individuals have become wealthy quickly by adopting cryptocurrency early, while others have established businesses that rely on cryptocurrency trading for their revenue.

The number of employment opportunities in the blockchain industry has increased significantly, from just over 1,000 in 2016 to more than 4,000 in 2017. The demand for software engineers has been the highest among all professions in the cryptocurrency industry. Despite fluctuations in the job market, interest in these professions has remained constant.

Currencies

Trust in U.S. banks has declined since the 1970s. In countries with unstable local currencies, cryptocurrency can provide a way out of the resulting economic hardship. This decentralized practice enables peer-to-peer transactions without government intervention.

Around 1.7 billion people worldwide lack a bank account and face financial difficulties, often resorting to dangerous lending practices. Many of them, however, own mobile phones. With cryptocurrency transactions available through mobile applications, it could become a viable option for them.

Cryptocurrency’s decentralization also provides an advantage by allowing citizens of countries with unstable currencies to trade with citizens of more economically stable countries, promoting a sense of economic fairness.

Transparency

Blockchain technology and cryptocurrency transactions are digitized and automatically tracked on an unchangeable ledger, making them immune to manipulation by individuals, organizations, or governments. This offers significant advantages, including greater power and autonomy for individuals and a reduced risk of fraud and corruption. In particular, these benefits can be especially valuable for people living in underdeveloped countries or those facing government oppression. Cryptocurrencies allow these individuals to participate in the global economy, which can help to boost their own economic prospects and overall well-being.

Challenging the USD

The USD has been the reserve currency of the global economy for many years, but Bitcoin and other cryptocurrencies are now challenging its dominance. Cryptocurrencies are increasingly being used in global transactions, causing the USD to lose ground. For many years, there have been attempts to reduce the USD’s influence and end its reign as the dominant currency, but none have been successful until now. Cryptocurrencies, especially Bitcoin, appear to be driving the process of de-dollarization, which has the potential to transform the global economy.

Crowdfunding

Crowdfunding has become popular for entrepreneurs and small business owners to raise funds for their projects. The emergence of cryptocurrencies and blockchain technology has made the process even simpler. Since 2017, Initial Coin Offerings (ICOs) have become the preferred crowdfunding method. Entrepreneurs no longer need to rely on business angels or venture capitalists to finance their ideas. Instead, they can use ICOs to raise funds from a broader audience, helping to boost their development process.

New Mode of Payment

Our generation has experienced a significant shift in payment methods compared to our parents and grandparents. Instead of relying on physical cash, we have become accustomed to using debit and credit cards. The financial system has seen many innovations over the years, and cryptocurrencies are the latest addition to the payment landscape. In fact, several countries have already started accepting cryptocurrencies as a form of payment. For instance, in Russia, people can use Bitcoin, Litecoin, and other Altcoins to buy plane tickets, pay for taxis, and purchase various other services.

Final Thoughts

Cryptocurrencies are having a significant impact on the global economy, and their popularity is increasing rapidly. They offer advantages such as transparency, decentralization, and the potential to make capital and financial services more accessible. Cryptocurrency has also led to the creation of a new industry that has generated many job opportunities. Furthermore, it provides a viable option for people without bank accounts or those living in countries with unstable currencies. With the potential to challenge the USD’s dominance and transform the global economy, cryptocurrencies are indeed a significant development in the financial landscape.




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

View other posts by Soko Directory Team


More Articles From This Author








Trending Stories










Other Related Articles










SOKO DIRECTORY & FINANCIAL GUIDE



ARCHIVES

2024
  • January 2024 (238)
  • February 2024 (227)
  • March 2024 (190)
  • April 2024 (73)
  • 2023
  • January 2023 (182)
  • February 2023 (203)
  • March 2023 (322)
  • April 2023 (298)
  • May 2023 (268)
  • June 2023 (214)
  • July 2023 (212)
  • August 2023 (257)
  • September 2023 (237)
  • October 2023 (266)
  • November 2023 (284)
  • December 2023 (176)
  • 2022
  • January 2022 (293)
  • February 2022 (329)
  • March 2022 (358)
  • April 2022 (292)
  • May 2022 (271)
  • June 2022 (232)
  • July 2022 (278)
  • August 2022 (253)
  • September 2022 (246)
  • October 2022 (196)
  • November 2022 (232)
  • December 2022 (167)
  • 2021
  • January 2021 (182)
  • February 2021 (227)
  • March 2021 (325)
  • April 2021 (259)
  • May 2021 (285)
  • June 2021 (272)
  • July 2021 (277)
  • August 2021 (232)
  • September 2021 (271)
  • October 2021 (305)
  • November 2021 (364)
  • December 2021 (249)
  • 2020
  • January 2020 (272)
  • February 2020 (310)
  • March 2020 (390)
  • April 2020 (321)
  • May 2020 (335)
  • June 2020 (327)
  • July 2020 (333)
  • August 2020 (276)
  • September 2020 (214)
  • October 2020 (233)
  • November 2020 (242)
  • December 2020 (187)
  • 2019
  • January 2019 (251)
  • February 2019 (215)
  • March 2019 (283)
  • April 2019 (254)
  • May 2019 (269)
  • June 2019 (249)
  • July 2019 (335)
  • August 2019 (293)
  • September 2019 (306)
  • October 2019 (313)
  • November 2019 (362)
  • December 2019 (318)
  • 2018
  • January 2018 (291)
  • February 2018 (213)
  • March 2018 (275)
  • April 2018 (223)
  • May 2018 (235)
  • June 2018 (176)
  • July 2018 (256)
  • August 2018 (247)
  • September 2018 (255)
  • October 2018 (282)
  • November 2018 (282)
  • December 2018 (184)
  • 2017
  • January 2017 (183)
  • February 2017 (194)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (205)
  • July 2017 (189)
  • August 2017 (195)
  • September 2017 (186)
  • October 2017 (235)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (164)
  • February 2016 (165)
  • March 2016 (189)
  • April 2016 (143)
  • May 2016 (245)
  • June 2016 (182)
  • July 2016 (271)
  • August 2016 (247)
  • September 2016 (233)
  • October 2016 (191)
  • November 2016 (243)
  • December 2016 (153)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (164)
  • April 2015 (107)
  • May 2015 (116)
  • June 2015 (119)
  • July 2015 (145)
  • August 2015 (157)
  • September 2015 (186)
  • October 2015 (169)
  • November 2015 (173)
  • December 2015 (205)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950