The blockchain technology and cryptocurrencies are rapidly changing the way people carry out financial transactions all over the world. Various industry experts are hoping that crypto banking will soon become an integral part of the mainstream financial industry because of the massive advantages offered by it.
Many big and small countries are also supporting the blockchain technology and cryptocurrencies in their own unique ways. One of the recent ones to join the trend is Isle of Man which opened a dedicated Blockchain Office and Sandbox some time ago. Let’s now tell you about some important ways in which cryptocurrencies are impacting the financial transactions at the global level.
Doing away with the banking system’s imperfections
The conventional way of conducting financial transactions has become vulnerable to hacking attempts and all kinds of compliance and governance-related issues over a period of time. Cryptocurrencies are playing a key role in doing away with the imperfections of the traditional banking system. To give you an example, crypto banks are not vulnerable to the same kind of data breaches as traditional banks are. Furthermore, cryptocurrency transactions are secure and anonymous in nature. In addition, unlike the paper currency, cryptocurrency cannot be counterfeited.
Elimination of the middlemen
In the conventional banking system, the money is deposited into a bank and the users are allowed to only make transactions which are sanctioned by these banking establishments. However, in case of cryptocurrencies, as the entire system is decentralised, the transactions can be carried out independently and securely without the need of any middlemen. No one holds onto your money. Rather your money is stored in the cloud through the blockchain technology. This is also the reason why the conventional banking industry is afraid of blockchain technology as it can possibly result in the former’s collapse. Many are wondering if the future of banking is all about bitcoin and blockchain?
Lowering the transaction cost
The transaction is carried out through cryptocurrencies are much cheaper compared to the ones done through traditional money transfers. To give you an example, if you pay $ 1000 through your credit card to a vendor, you will incur some minor additional charges too. These charges are because of the other entities involved in the process. However, in case of cryptocurrencies, you pay exactly what you need to, as there are no other entities involved.
One of the biggest changes brought about by cryptocurrencies is how convenient and quick they have made the financial transactions. There is no need of carrying wads of cash in your pockets or multiple credit cards in your wallet. Cryptocurrencies do away with these troubles and are also not prone to loss, theft and other similar mishaps. The blockchain technology enables you to store your cryptocurrencies in electronic wallets that can be firmly safeguarded with the help of secure passwords. Although it is still possible for you to lose your crypto cash, you’d need to commit many silly mistakes to be able to do that.