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2020 Global Challenges for Cryptocurrency

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2020 Global Challenges for Cryptocurrency

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Blockchain, Bitcoin, and Cryptocurrency are some of the terms that you must have heard at some point in your life. Especially in the past decade or so, cryptocurrency became the talk of the global economic forums. As many authorities began to question the future of monetary assets, money, and similar resources, cryptocurrency was among the more controversial topics.

In 2019, right before Blockchain could have seen a public acceptance phase, the revolution came to an abrupt halt. According to the Gartner Group, it was called ‘Blockchain fatigue.’ Other experts also jumped on the bandwagon that the fire of Blockchain technology and virtual currency, in general, has fizzled out. People thought maybe it was a phase after all that overstayed its welcome.

Pragmatically, the perspective is incorrect. According to recent statistics, the crypto market has an estimated total market capitalization of over $155 billion as of 15th March 2020. Considering these numbers and based on many financial institutions, powers might tend to disapprove of cryptocurrency, but they are in favor of Blockchain technology. The disruptive nature of decentralized currencies such as Bitcoin and others has led to a corresponding halt to its progress.

Let’s find out what more challenges do cryptocurrency has to face as the year 2020 goes by.

Challenges Hindering Cryptocurrency Growth and Acceptance Worldwide

The following are the challenges hindering cryptocurrency growth and acceptance on a global scale.

1.  Boom Phase for Blockchain

There is no doubt about the fact that where cryptocurrency is facing the challenge of surviving and being accepted by the masses, Blockchain technology has already surpassed it. The masses have widely accepted it, and big names of global trade specialists are now moving towards Blockchain.

The likes of Trade Lens by IBM and Maersk’s joint Blockchain investment in the shipping industry have welcomed the first-ever initiative taken. Many such mind-blowing initiatives are underway that involve Blockchain apart from the cryptocurrency domain. The challenge for crypto-enthusiasts here is that once the Blockchain technology takes off without crypto, it will be the end to it.

2.  Bad Imagery

Cryptocurrency, even after having gone through a boom phase, still has a PR problem. The terms associated are enough to conjure up images of cringe advertisements, low-quality campaigns, bad actors, get rich quick schemes, and criminals alike. For many people, cryptocurrency spells out new technology for age-old scams and frauds, which they don’t want any.

It may seem like a petty issue, given the magnitude that is a cryptocurrency and the Blockchain industry. However, this issue has hindered crypto for years since its inception and will continue to do so if no knowledgeable individuals came forward in favor of it.

3.  Blockchain vs. Authorities and Officials

US constitution is known worldwide for its protection right given to the democratic entity that the country is. Freedom of speech, access to information, and the right to form an opinion is protected by the officials to be open. However, on the flip side, when it comes to assets and financial resources, our system laws, governments, and authorities are designed to keep it limited amongst the powerful.

It is evident why crypto and Blockchain has taken over a decade to adjust in an economy where it had to tackle issue arising from the core of how our economy and society operates.

a. Lack Of Legislation

Digital currencies are decentralized virtual entities. They are purely digital products, and our authorities are not geared to handle this advanced technology. That is why the lack of legislation regulating these digital currencies and providing any sort of user protection has become a huge challenge.

The essential step that needs to be taken to reduce the risk involves educating and informing people about keeping their personal data safe. There is still a gaping void where insurance and dedicated legislation needs to be placed. But until that happens, awareness to safely exercise crypto is crucial.

b. Legal Obstacles

In addition to lack of legislation, the other big obstacle that stands in the way of cryptocurrency holders like Bitcoin traders and users is the challenge to spend their holdings. The untraceable nature of Bitcoin and its bad imagery as a mode of finance for mega criminal activities like terrorist attacks and the drug trade has made it quite scandalous in some countries.

Cryptocurrency is going through a period of abrupt halt where nothing much seems to be happening around the technology. Therefore, one can’t say for sure that what the future holds unless wide acceptability affects these legal obstacles standing in the way of crypto-trading.

4.  The Technology Is Still Immature

Cryptocurrency faces implementation obstacles beyond the lack of regulation and inactive obligations. The technology is an emerging one and is still immature in a system where other options are widely scalable and accepted over it.

One might think how a technology that has been out there for over a decade now can be new and emerging. The reason is that not much has been done to expand it.

a. Interoperability

Interoperability or the ability of computer system software to exchange and utilize information is a challenge faced by Blockchain. The technology has been divided to make multiple uses of it in different industrial domains, separate form cryptocurrency.

The technology needs to be made interoperable for the internet dedicated to Blockchain and crypto exchange. Until then, as long as people continue to go by illegal and wrong means of mining it, the technology is a threat to the economic system that opens its gates to accept virtual currencies.

b. Usability

This point cannot be emphasized enough how difficult it is to buy and sell crypto. We are way in the year 2020, and it is still as difficult as it was back in the day when Bitcoin was first launched. The mere participation in the crypto world requires a nerve-wracking validation that general people find unappealing.

The security procedures are so complex that they have become hurdles in crypto adoption as a mode of exchange. Most students look for personal statement help UK who have a high interest in cryptocurrency markets but unable to compose a compelling profile.

It is still a significant challenge for the industry to create user-friendly processes for buying, selling, storing, and using cryptocurrency securely without being called out for it.

c. Scalability

The generally acceptable country-wise currency exchange and even the banking transactions in different currencies have been made scalable and adaptable to the different rates. Cryptocurrency has years of effort to go until it finally reaches a scalability level that Dollar, Yen, Pounds, or Rupee have gotten to.

While interoperability may be a huge step forward to achieve that, that itself is a challenge to mitigate first, the system is so slow, and many dominant platforms for smart contractual applications are still under development. The processes face numerous delays and would require many scalable solutions to counter this issue of exchange.

d. Data Rights

Data has reached a level of becoming a digital asset at this point. Digital mafia considers data the real deal and a key to all things penetrable for the immense value it can hold for individuals and organizations. That is why one of the biggest lose loop in cryptocurrency is and will always be data rights and privacy.

The solution here is not just government protection of privacy and data for cryptocurrency traders. A dedicated system is required where such identities can capture and control their own data. And where there is a long way to go for an efficient framework, many initiatives have been taken and underway.

e. Security

Blockchain might be immature, but it is so far advanced that it is more secure than a traditional computer system.

However, many financial breaches, data leaks, and huge losses due to the system vulnerabilities have made it challenging for people to be satisfied with their transactions. At one point in time, $250 million were lost in a single transaction through QuadrigaCX exchange due to its deadly centralized business model.

In addition to it being not secure enough, these pieces of news make rounds globally. People have lost faith in cryptocurrency over time.

2.  Difficulties Of Bitcoin Transactions

In 2013, a crypto-enthusiast made a luxury car dealership in Costa Mesa, CA, for a Tesla Model S and paid for it in Bitcoin. Just under 92 bitcoins that were worth over $100,000 at that time, the deal was sealed and legally conceived. Considering this transaction and comparing it with the real-time value of crypto right now, the setback and skepticism surrounding Bitcoin have not done much harm to the growing estimation of it.

However, one cannot move past the real-time losses that have occurred given the Bitcoin transactions over the years. Spending Bitcoin is still a huge deal than hoarding it.

a. Countries Banning Bitcoin

Countries like Vietnam, Bangladesh, Bolivia, and Ecuador have prohibited crypto transactions. The state bank has outlawed it and declared cryptocurrency an illegal form of payment with a heavy fine due to violators. And even where it is legal, there are countless logistical issues.

Even in the United States, the Securities and Exchange Commission is having an ongoing debate if it prefers new regulations for the cryptocurrency market. If major countries with relevant economic forums stand against Bitcoin, it will become increasingly difficult for the crypto-type to gain acceptance from the masses as people continue to engage in it illegally.

b. Conversion Issues

Conversion remains a huge hurdle for Bitcoin vendors. As Bitcoin is not a fiat currency and is only limited to monetary value when converted to a cash equivalent, not many vendors go for its conversions for other cryptocurrency types. They are more willing to look for a payment method that delivers in Dollars or any other local currency. So that any exchange made for goods and products is made on consumer rates.

Such an implementation system is difficult even if bigger brands are willing to make it possible. No matter if a business sells cars or academic writing services, there is a lack of appropriate regulations to facilitate this type of exchange.

c. People Losing Money

Though Bitcoin regulatory protocol was not affected and not a single Bitcoin disappeared or got lost, people lost loads of money. The downfall and cases of transactional breakdowns are the major reason why cryptocurrency came to an unannounced halt in the first place.

There is a serious need to regulate and change the trading and mining protocols in Bitcoin and other cryptocurrencies. Only then can I expect the general public to safely indulge in Bitcoin mining and trading without feeling it to be illegal or a complete daredevil gambling moves on their part.

d. Volatility Of Prices

The volatility of prices also hangs in the balance of the potential of Bitcoin and cryptocurrency in general. Even though Bitcoin has gained significant community following over the years, there have been disputes among the community member for deciding the path it should take.

The compact user base has made the currency increasingly volatile. The stability expected concerning a centralized authority system to regulate it will increase once people start to accept it. The doubts about Bitcoin’s usage and the resistance by major countries to integrate the system and legalize it will continue to deteriorate the prices further.

Conclusion – The Stakes Are High

All in all, the results of no action being taken by major industrial giants, businesses, and government authorities have never been so altering ever since all these years of crypto trading and mining as it is now. The year 2020 is going to shape the cryptocurrency industry either for better or for worse.

Crypto networks like Bitcoin, corporations like Facebook, and nations like China implementing digital currency by the end of this year will be taking a step towards stumping Dollar as the record currency. It will, in turn, lead to the US Federal Reserve pushing ahead of the digital counterpart.

There is no denying that the stakes are high, and just like everything else, the future is unpredictable for cryptocurrency too.

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Claudia Jeffrey is currently working as a Junior Finance advisor at Crowd Writer, an excellent platform to get assignment help UK. She is a self-proclaimed crypto-influencer. She has gained significant expertise and knowledge in this regard over the years and likes to share it with an interested audience.

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How to Create an Enduring Workflow for AR

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Please note: Vocabulary in the payment automation world varies. While customers (i.e., clients, buyers) and their suppliers (i.e., vendors, beneficiaries, sellers) are both considered customers to payment automation companies like Nvoicepay, this article will use the terms “customer” and “supplier” to distinguish between them.

Imagine having to switch out old railroad tracks while a rusted steam engine thunders across. Adopting modern electronic payments runs about as smoothly for banks.

When you think about how old banks are in the U.S., it’s an understandable plight. They’ve been running on the same tracks since the first bank’s founding. Additional features, like wire payments and credit cards, were added over time as a complement to the old system. But the rise of nimbler financial technology (fintech) companies has lit a fire under them. Now they face the challenge of converting their processes to electronic means without disturbing their clients’ day-to-day business.

In a way, fintechs have it easy. Their very nature makes competing against banks a breeze, primarily because banks were built to last, and fintechs were built to adapt. They can easily shift gears to meet demand and immediate needs. Meanwhile, banks are frequently caught up in bureaucratic processes that make it virtually impossible to react quickly to problems.

Financial and fintech industries feel the contrast most often when tackling payment security—specifically when it comes to cards. Even though check payments incur 25% more fraud instances than card payments, according to the 2019 AFP Payment Fraud and Control Survey, many companies hesitate to make the switch to more electronic means.

Kim Lockett—the Director of Supplier Services at Nvoicepay, a FLEETCOR company—offers a glimpse into why companies are hesitating to shift gears: “Fraud is not a new issue to companies,” she states. “But what we’ve learned is that fear of change overrides the fear of potential fraud loss, even among companies who have already incurred those losses.”

With almost 30 years of experience in payments and financial services, Lockett possesses a holistic perspective on supplier expectations for seamlessly receiving payments, with payment fraud protection listed as one of the highest priorities. She’s heard all the horror stories, from a small business whose checks were stolen out of their mailbox and cashed, to a company whose employee tried to use business deposit information to clear her personal checks.

That’s not to say that errors and fraud don’t occur for card payments as well. But they occur significantly less and are much easier and faster to resolve than check, ACH, and wire payment issues.

What’s the Holdup?

In the last decade, fintech companies have improved the tracks on which many accounts receivable (AR) teams function. From providing lower processing costs for card payments to offering user-friendly portals for reliable payment retrieval, fintechs transform painful AR workflows into a functional process.

Meanwhile, banks have just begun to offer pseudo-solutions that appear to be tech-friendly but still run on old tracks. An excellent example of this is lockbox technology, where banks mitigate the processing of check payments and their data for their larger customers by taking on the work themselves. This sort of offering likely extended the life of check payments. Still, it didn’t eradicate the underlying problem: that even though work has been lifted directly from their customer’s shoulders, someone at the bank still has to process checks and submit data for manual reconciliation. The process is hardly automated, and the advent of payment processing technology has all but made the entire process impractical.

Embracing the Future

Of course, the best way to avoid check issues is to avoid checks. These days, electronic payment methods offer higher levels of security. But if electronic options like virtual card numbers are such a fantastic option, why are so many companies avoiding them?

Lockett states: “In general, I think companies are afraid of handling credit card numbers because they feel there is risk involved.”

It’s not the dangers of check payments, but misconceptions about electronic payments that cause companies to refrain from accepting them. Many AR teams rationalize that they’d rather respond to the inevitable check fraud cases they understand than walk unprepared into the relatively unknown territory of card fraud.

When checks are stolen and cashed, there’s very little that can be done. At the end of the day, someone will be out that money. Other electronic payment types like ACH and wire are significantly safer, but can still experience fraud, especially internal instances, such as when a company’s employee submits their personal bank account information to receive company payments. Whether these issues are reversible is dependent on each unique scenario.

Card payments, particularly the virtual card numbers provided by fintech companies, are typically protected by two-factor authentication. Whether this means that AR is supplied with a login to access secure details or a portion of a card number, the information is much more difficult for bad actors to access, securing the payment process and reducing the risk of fraud.

In the end, not every company will have the capacity to accept card payments, so leaving alternate options open like check and ACH truly boils down to how much individual payment providers value customer service.

Taking Suppliers Along for the Automation Journey

In many cases, banks have rushed to cater to customer’s needs, leaving suppliers in the dust when it comes to follow-through on electronic payments. Despite these efforts to change, most larger banks still follow their old tracks, and their customers and suppliers experience the same lack of customer service they always did.

With over 10 years of support development behind them, fintechs have expanded their offerings to suppliers, catering to their specific needs, whether they require something as simple as customizable file formats or a more significant request like payment aggregation. Fintechs that follow through with supplier support are truly delivering on their promise of offering an end-to-end solution. They are building tracks that support the advanced bullet trains that companies have become.

“Ten years ago, companies were reluctant to add virtual card payments to their list of accepted payment types,” says Lockett. “Education, experience, and word-of-mouth have established virtual card payments as a mainstream and relevant way to conduct business.”

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Alyssa Callahan is the Content Strategist at Nvoicepay, a FLEETCOR company. She has five years of experience in the B2B payment industry, specializing in cross-border B2B payment processes.

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Cryptocurrency’s Necessary and Inevitable Evolution

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Cryptocurrency is at the precipice of ushering in the next era of finance. However, in order to be regarded as a commodity, traded and managed in the same way we now do with precious metals, equities, and derivatives, cryptocurrencies must become subject to similar rules, regulations, and trust mechanisms that apply to traditional assets. Such assurances are necessary for cryptocurrencies to achieve their full potential. Banks and financial institutions, as well as other industries, require security at scale and other layers of assurance, like insurance and chain of custody tracking. Adopting the means to develop a high level of trust is an absolute necessity for implementing cryptocurrency in a meaningful way. The question is, how do we get there?

Traditional asset management firms act as fiduciaries on behalf of their partners, subject to rules that ensure the safekeeping and custody of the assets they hold on behalf of their clients. Becoming a fiduciary in the world of cryptocurrency is a complex process, requiring a combination of specialized software and hardware, physical security, as well as clear policies and processes that ensure safe custody of assets. It also requires establishing the means to adopt the regulatory underpinnings for strictly digital assets, and that affords customers the kind of transparency and assurances—track record, management team, balance sheet—that ensure custodial trust is essential.

However, that does not exist in traditional cryptocurrency exchanges where the roles of broker-dealer, clearinghouse, bank and custodian are all handled by a single organization, usually an exchange. That’s too risky for large scale financial operations.

Here are a few elements that should be adopted to mitigate that level of risk and provide acceptable assurances for institutional and large-scale industrial adoption:

Adopt the SOC 2 digital security framework. SOC 2 is a set of rules developed by the American Institute of CPAs to establish a certifiable process of strict, auditable controls for building confidence, and ensuring trust and integrity, in service organizations dealing with digital assets.

Require that institutions act as fiduciaries. Fiduciaries are required to act in the best interests of their clients and must abide by a number of rules and adopt safeguards meant to establish and ensure trust. Fiduciary rules protect the client in the event of wrongdoing, error, or as a backstop to a catastrophic event such as being hacked. Safeguards associated with fiduciaries include insurance, funds in escrow, capital in reserve, security and other procedural checks, and no commingling of client coins.

State-of-the-art security. Digital assets have proven difficult to secure. Trust and security for institutional management of cryptocurrencies require the strictest, strongest technology and processes available, including multi-signature access using private keys, as well as a combination of both online (“hot”) and offline (“cold”) storage of assets to minimize risk.

If we start with these three things, we can accelerate the process of establishing necessary trust in cryptocurrencies. Even though it is counter-intuitive to the prevailing ethic, the benefits of using cryptocurrency in today’s global marketplace demand that at least the leading forms of cryptocurrency, like Bitcoin and Ethereum, adopt rules and even submit to regulations on par with those dictating the operation of traditional financial exchanges. This high level of trust would allow organizations to take advantage of the cryptocurrency’s “frictionless” ease of use and access while providing assurance of the asset’s security.

This type of evolution has happened again and again in financial services. Over the last half-century, security in financial services has evolved from an approach focused on building imposing physical controls, to one emphasizing digital trust. Over that time, we’ve observed those changes in the construction of financial institutions. At one time banks were imposing fortresses built of granite blocks and steel bars, outfitted with armed guards, and intended to send the clear message that your wealth was safe inside. Then, after currency was taken off the gold standard and protected with insurance policies, banks became open, airy, and inviting facilities that emphasized convenience.

Today, a bank may be nothing more than an intermediary operating from a web site or smartphone application. As long as the client is content that their money is secure, there is little concern for the format. That is because security has fully transitioned from the physical to the digital and, while there remains something of the past in our concept of cash and currency, the shift is complete. Cryptocurrency is the natural, next-step in the industry’s evolution.

People have become used to the idea that money doesn’t have to be a tangible representation of wealth, and that the ease of access that comes when wealth is digitized is a part of the value of an individual’s or organization’s finances. Today, more than a decade after Bitcoin’s advent, cryptocurrency represents the next phase of finance, but to get there means taking these important steps and adopting meaningful controls in order to satisfy the demands of traditionally staid industries like financial services. The good news is that, while the market recognizes that the mainstreaming of cryptocurrency is an inevitability, we have the model for making it work. We can—and must—do so for the benefit of the global economy.

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Nick Carmi is the Head of Financial Services at BitGo

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Commerce, Currency, and Credit —and What’s Next

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The notions of commerce, currency, and credit are nothing new. For centuries, we’ve found ways to barter, borrow, and repay one another through the exchange of goods, services, or credit. Exchange aside, every form of currency has an assigned value agreed upon by the individuals or organizations participating in the transaction.

Need a house or a plot of land? Everything had a price. Back then, we offered what we had…like goats, cows, or crops. In modern times and with the development of currency, we have turned to coins, paper, plastic, and other forms of credit to define the values of our exchanges.

If we begin to think about the evolution of commerce in the context of innovation, we simultaneously begin to wonder, ‘What’s next?’

As the COO of a fast-moving fintech company, I look to innovation to answer this fundamental question. It will always be top-of-mind for me, in order to ensure that our business is at the forefront of innovation when it comes to contemplating the many ways Americans — particularly those in the small business community — think about and gain access to commerce, currency, and credit.

Today, small businesses are faced with an unfavorable choice when considering taking on additional capital: curb their instinct to innovate and grow, or encumber themselves with debt. While the growth of small businesses will help our economy thrive, we can’t increase our ability to provide funding to small businesses by maintaining the status quo. So how do we inject businesses with funds, without ultimately harming that growth and innovation?  I suggest several ways: decrease our industry’s approval time and simplify the process; provide customized offers and understand the uniqueness of each business through the implementation of artificial intelligence and advanced technology, and restore the innate integrity and trust from the nascent days of commerce.

Here are three topline factors that will drive commerce, currency, and credit — and what’s next:

Convenience

If we look at the transition in the consumer payments industry as a leading indicator, we think about the emergence of fast-pay apps like Zelle, Venmo, or Apple Pay, one thing is clear: convenience is king. Even if it costs the consumer a dollar or two, it beats the basic, but now outdated steps of writing a check, (purchasing and) putting a stamp on the envelope, putting it in the mail, and making sure the mail person gets it on time. Certainly, checks have a role to play in the exchange of money — and perhaps always will — but fast cash apps represent the shift.

If we examine the ways that small businesses have historically gained access to capital, what were once nothing more than hard-copy applications followed up by mountains of paperwork issued by traditional banks that required waiting weeks or even months to hear of an approval, is rapidly evolving into what is now a full-fledged industry dedicated to providing capital in mere days or even hours  —with companies in industries ranging from online retailers to credit card processors, and more, working to deliver working capital in the near speed it takes to complete an ATM transaction. Just as odd as dropping a goat off today to pay for a good or service would seem, so too will be the long timeframe to secure small business capital via a long arduous process.  We are quickly moving to a couple of button clicks on your cell phone and capital will be delivered into your business account.

Channels

When discussing my philosophy about our business, three words colleagues often hear me use are “channel of choice.” They refer to finding our customers by identifying who they are, where they are, and what is their preferred method of communication; and of course, delivering superior user experience.

Which “channel of choice” will appeal to the busy mom-and-pop shop owner who calls us from her landline in search of new ways to gain access to capital for a new storefront facade; or to the construction company that does most of its business and banking online and prefers to be reached via the web; or, to the 20-something app developer who likes to do his business with a simple click on his phone?

Our success is contingent upon creating an appropriate environment and successful strategy for each of our customers, all of whom have varying degrees of means and preferences to interact with us.  While mobile interactions will continue the trend to dominate in preference, there will likely always be a need to handle interactions with just a simple phone call.  And delivering an intentional experience with all of those channels in mind will become the new normal

Caution

Over the past few years, the vulnerability of data, privacy, and information security systems has been exposed. As we move into a more digital environment where every piece of data is at your finger times, it’s incumbent upon us in the alternative financial services industry to evaluate the ways we protect the vast information we hold in similar ways customers expected traditional banks to hold and secure their deposits. The phrase “data is the new currency” is quickly becoming reality and expectations of security from those who provide us that information will be just as high as dropping of a deposit to your local bank. As mountains of information continue to become available, it will become a focus for all to consider how we store that information just as a bank locks up its currency in a vault.

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Herk Christie is the Chief Operating Officer of Expansion Capital Group, a business dedicated to serving American small businesses, by providing access to capital and other resources, so they can grow and achieve their definition of success. Since its inception, ECG has provided approximately $400 million in capital to over 12,000 small businesses nationwide.

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What is Cryptocurrency? Is It Accepted Globally?

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Money is an ancient technology and is almost as old as language itself. Back in the day, before the introduction of money, all transactions were done with the barter system as products and services were not quite complex. For instance, a farmer who grew vegetables could exchange a reasonable quantity of it with wool from a Shepard. With the introduction of precious metal coins as currency, the barter system eventually faded out, and so did precious metal coins with the adoption of paper currency notes. With the advent of new technology, the older systems phase out giving way for new ones.

Cryptocurrency is a digital asset that is based on a network that uses strong cryptographic encryption techniques for carrying out secure financial transactions and is distributed across a large number of computers. Most cryptocurrencies employ decentralized networks based on blockchain technology which means every new block generated must be verified by each node before being confirmed. Simply put, a cryptocurrency is a virtual currency that is secured by nearly impossible to counterfeit cryptography.

Besides being the most secure way to conduct a transaction, it also happens to attract the lowest transaction costs, the prime reason for which is its decentralized system. Unlike conventional centralized systems used by banks, cryptocurrencies make use of each of the nodes to confirm the transaction. The conventional system can also be referred to as master-slave architecture in which the bank is the center of power, hence the master and all users are slaves whereas, in decentralized cryptocurrencies, each node is equipped with equal access to all financial services.

We humans are not exactly fond of change though. Despite the benefits of using a newer system, mass adoption takes a while. Did you know that until 1933, each dollar could be redeemed in gold? Did you know all Americans were required to turn in their gold on or before May 1, 1933, to the Federal Reserve in return for $20.67 of paper money per troy ounce? Yes, it was made illegal to own and trade gold by Executive Order 6102 by President Franklin D. Roosevelt whereas the gold standard was suspended in Britain on September 21, 1931. Many speculate that a similar blow from the government could happen anytime in the future since fiat currencies that are controlled by the government. Cryptocurrencies are global and will not be affected by decisions made by the government of one country or the other.

Currently, there are several thousand cryptocurrencies, Bitcoin, Litecoin, and Ethereum are the most popular ones. Check out this infographic by Total Processing to learn more about other advantages of cryptocurrencies.

Click here for a full-size image.

 

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This infographic originally appeared on TotalProcessing.com. Republished with permission.

Archives, Global Trade Daily, Special Reports

Will Facebook’s Libra Help Bring Cryptocurrency To The Masses?

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When Facebook announced plans for a stablecoin called Libra, the reaction from the cryptocurrency world ranged somewhere between skeptical and cautiously optimistic.

But, regardless of any specific merits of Facebook’s version of a digital coin, the social-media giant’s move could help speed the adoption of cryptocurrency to a larger audience, says Kirill Bensonoff (www.kirillbensonoff.com), a serial entrepreneur and an expert in blockchain.

“The biggest issue now is that most people are not familiar with crypto; they think it’s difficult to use, and they may not trust it,” Bensonoff says. “Facebook will put a digital wallet on many phones and computers, and sending payments with crypto will become commonplace.”

Facebook’s Libra is proposed as a stablecoin, which is a form of cryptocurrency. Using Libra, people would be able to buy things or send money to others while paying, at most, minor fees. Unlike other cryptocurrencies such as Bitcoin, the value of stablecoins is tied to an asset such as gold, the U.S. dollar, the Euro or other currencies.

Facebook won’t have complete control of Libra. It’s just part of a bigger group of partners that’s creating the stablecoin.

What might all this mean for the future of cryptocurrencies – and for the average person who still knows little about them? Bensonoff says a few things worth knowing about Libra in particular and stablecoins in general include:

-Bringing stability to cryptocurrency. As the name implies, the idea of stablecoins is to bring more stability – and more peace of mind for wary investors – to the world of cryptocurrency. “I don’t think Facebook will bring stability immediately,” Bensonoff says. “I believe it’s going to take a lot more in terms of mass adoption, but Libra could be a step in the right direction.”

-The SEC’s view. Regulators at the Securities and Exchange Commission have been eyeing stablecoins with the possibility that some of them could be classified as securities. “That could put stablecoins in the same category as stocks, subject to the registration, disclosures, and accreditation of investors that demands,” Bensonoff says.

-Will Libra replace PayPal? Maybe not, considering that PayPay is one of the founding members of Libra, Bensonoff says. “I think they will have some influence on the direction,” he says. “However, crypto in general is a threat to all existing payment processors, including PayPal. I believe PayPal is smart and will adopt and accept crypto payments, and they will figure out a way to monetize it. The downside for them is they won’t be able to charge nearly as much as they do now.”

“I believe Libra is going to have a positive impact in terms of awareness, adoption and interest in cryptocurrency from both businesses and consumers,” Bensonoff says. “But at the same time, with that could come more regulatory scrutiny.”

About Kirill Bensonoff

Kirill Bensonoff (www.kirillbensonoff.com) has over 20 years experience in entrepreneurship, technology and innovation as a founder, advisor and investor in over 30 companies. He’s the CEO of OpenLTV, which gives investors across the world access to passive income, collateralized by real estate, powered by blockchain. In the information technology and cloud services space, Kirill founded U.S. Web Hosting while still in college, was co-founder of ComputerSupport.com in 2006, and launched Unigma in 2015. All three companies had a successful exit.

As an innovator in the blockchain and DLT space, Kirill launched the crypto startup Caviar in 2017 and has worked to build the blockchain community in Boston by hosting the Boston Blockchain, Fintech and Innovation Meetup. He is also the producer and host of The Exchange with KB podcast and leads the Blockchain + AI Rising Angel.co syndicate. Kirill earned a B.S. degree from Connecticut State University, is a graduate of the EO Entrepreneurial Masters at MIT, and holds a number of technical certifications. He has been published or quoted in Inc., Hacker Noon, The Street, Forbes, Huffington Post, Bitcoin Magazine and Cointelegraph and many others.

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What is Cryptocurrency and How Is Its Global Acceptance

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Cryptocurrency in layman terms can be described as a virtual currency that is not controlled by a centralized system. To further elaborate, the crypto in cryptocurrency comes from the word cryptography, which was a practice used during second world war to communicate securely with the use of hard to crack codes that represent critical information. One of the most popular cryptocurrencies is bitcoin which is based on blockchain technology and many other cryptocurrencies are based on the same principle.

Resistance is often the first reaction of masses towards new technology and you will be surprised to learn that electricity, automobiles, and the internet were initially made fun of. Whether it is electrification being called a fad over gas-powered lighting and heating solutions, automobile use disregarded as dangerous over the use of horses, or the scare that internet will be used by criminals, the prime reason for this behavior is the feeling of comfort with the existing system.

There is a lot of confusion around cryptocurrency as there is a lot of skepticism around it. Most people do not understand how it functions and hence they oppose it. Cryptocurrencies are also being blocked by certain countries and centralized banks as they are impossible to monitor and control. Since the transfer of funds can be made anonymously, its use for illegal transactions is seen as a threat.

The positive uses and prospects for the future that cryptocurrency holds outrun the fear and skepticism around it. Value of 1 Bitcoin was less than a cent when it started in the year 2008 and 2009 when the first Bitcoin block appeared. Its value peaked at a little less than $20,000 in December 2015 and 1 Bitcoin is currently valued at approximately $10,000. Want to learn more about cryptocurrency, Bitcoin, and stats on its global acceptance? Check out this infographic from Total Processing to learn about other cryptocurrencies such as Litecoin, Ethereum, and a new one which is yet to be announced from the house of Facebook.

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