How Bitcoin Could Change the Financial World
A growing number of individuals are aware of Bitcoin. However, the majority are clueless about what it is and its impacts. Yet, Bitcoin and cryptocurrencies, in general, are now part of the mainstream financial system. To start trading in Bitcoin, you can join a trading app like this app (biticodes) that will guide you when buying and selling it online. And you don’t have to be an experienced trader to use the app.
What does this mean for the financial system?
Before answering the question, let’s explain what Bitcoin is. In simple terms, Bitcoin is an electronic, virtual, or digital currency that uses blockchain technology. Blockchain technology allows for decentralized peer-to-peer systems. Such a system, like Bitcoin, is unregulated because no government manages it.
Bitcoin has become popular alongside other cryptocurrencies because of its unregulated and transparent nature. Anyone can use Bitcoin, even those that cannot access conventional financial services like opening bank accounts. Bitcoin is also an investment asset that people can trade like other assets such as CFDs, stock, and gold.
Boosting Financial Inclusion
Bitcoin will boost financial inclusion, especially in countries where many people and businesses cannot access financial services. In most developing countries, financial inclusion remains low for various reasons, including high illiteracy rates. And this means that a significant proportion of the population can’t join the existing financial system.
Bitcoin will ensure that even those the existing financial system does not cover can access financial services. Unlike the centralized financial system, Bitcoin does not have numerous user requirements. Anyone can use Bitcoin as long as they can open a Bitcoin wallet. From an economic perspective, more people and small businesses can access loans, own Bitcoin, and even transfer Bitcoin.
Eliminating Intermediaries
The blockchain technology that supports Bitcoin has a unique feature. It is a distributed global ledger. Millions of users are on the register and can see and track all transactions on the blockchain network. There is no centralized control or management, and many users on the blockchain network share the database.
Governments control and manage the system through central and commercial banks in the conventional financial system. These intermediaries cause transactions to be slower and costlier. For example, if you want to send money to your family abroad, you must wait for days and pay a significant fee.
Blockchain eliminates all the intermediaries and makes transactions faster, cheaper, and safer. For example, if you send Bitcoin to your employees abroad, the Bitcoin will arrive instantly and at a dramatically lower cost. You don’t have intermediaries to validate transactions because blockchain technology automatically validates them.
Reduce the Power of Big Financial Institutions
Bitcoin can also change the financial world by reducing the power of big banks and financial entities. Big banks, credit card companies, and other powerful institutions currently control the financial system. They can use their power to interfere with the free and democratic economic system.
Bitcoin eliminates the concentration of power and influence on one or a few entities. Since they will have no place in cryptocurrency, big banks and financial institutions could die. They thrive on exerting powerful influence, and since Bitcoin eliminates this, they will have no impetus to continue operating. But the world will wait to see how this goes.
Conclusion
Bitcoin and other cryptocurrencies have become mainstream and are disrupting the financial world slowly. Despite numerous efforts to ban and regulate Bitcoin, the cryptocurrency wave has thrived. As we advance, as Bitcoin continues to grow in terms of use and impact, we are likely to witness more unexpected disruptions in the financial world.
