Recently, cryptocurrencies have been all over the news because of their exceptional growth in value. As a result, many people started looking at digital assets as potentially lucrative investments. Thus, there is a large community of crypto enthusiasts today who do not plan on spending their tokens in the near future and hope to sell them when a good opportunity emerges. These individuals surely have a strategy, but by avoiding using their coins, they miss out on all the main advantages of cryptocurrencies. After all, the success of crypto can definitely be attributed to their features which are superior to those of fiat currencies.
- Cryptocurrencies are secure, anonymous and borderless alternatives to fiat currencies.
- Crypto transactions are cheap and fast and do not involve banks.
- Users who spend crypto can be certain that their funds will reach the desired recipient in a short period of time without any problems.
- Businesses can gain a competitive advantage by accepting cryptocurrencies and NOWPayments crypto payment processor can help any businesses to get a stake in the crypto economy.
Fiat money is great, but finding a way to store them securely can be a tall order. Managing large quantities of paper notes entails multiple issues, from installing a system to prevent burglaries to ensuring proper climate conditions. Of course, there is always an option of depositing money at a bank, but no financial institution can guarantee you that tomorrow it will not go bankrupt, and you will lose all of your funds.
Cryptocurrencies have a considerable advantage over fiat in terms of secure storage. Any crypto enthusiast can keep their funds in a non-custodial wallet which allows the user to hold their private key and thus possess full ownership of their coins. The private key protects the coin holder from any unauthorized access by a third party. There are also hardware wallets and even paper ones, so investors have a variety of ways of storing their money without losing any control.
Decentralization and the Absence of Banks
Blockchain technology was created to promote the idea of decentralization. Every user that participates in a blockchain keeps a copy of the ledger where every transaction made on the network is recorded. Subsequently, blockchain is transparent since everyone has access to the activity which takes place on it. In a traditional banking system, banks may conceal some information from their shareholders and clients. Yet, thanks to the blockchain, it becomes impossible.
Additionally, banks, as major holders of fiat currencies, exercise significant control over the funds deposited by their clients. They can freeze their customers' accounts over suspicious activity and block transactions. On a blockchain, there are no banks since all transactions are peer-to-peer. This means that users are not subject to any rules and regulations and are free to send their funds whenever and to whomever they please.
Anonymity and Security
To conduct transactions on a blockchain, users do not have to register and provide their personal information or disclose their identity. Blockchains are completely anonymous, and the level of privacy one desires to have also varies from one network to another. In the case of Ethereum and Dogecoin, every transaction is visible to anyone, but it is extremely difficult to track a person without knowing their crypto address. Nevertheless, if this is still not enough for someone to feel anonymous, there are currencies that rely on the principles of absolute secrecy. For instance, Verge utilizes Dual-Key Stealth Addressing, which lets the sending party generate a number of one-time destination addresses for the recipient.
Moreover, hacking a blockchain is extremely hard because of its decentralized nature and strong protocols which support the integrity of a network.
Low Transaction Fees and Fast Transfers
Perhaps the biggest advantage of cryptocurrencies is the price of on-chain transactions. Since there are no banks present on a blockchain, users avoid paying any additional expenses on top of the transferred sum in the form of monthly maintenance and excessive transaction charges. On a blockchain, all a user has to pay is a small transaction fee which is often absolutely negligible. For example, XRP’s transaction fee is 0.00001 XRP. This is particularly beneficial for businesses that can partially lower their prices and attract new clients by accepting cryptocurrencies which can save them a lot of money.
Cryptocurrencies are also unbeatable when it comes to the speed of transfers. It takes 0.14 seconds for Nano to confirm a transaction. Such swift transactions are hardly imaginable in a traditional banking setting where money can travel between accounts for several days.
Borderless Trade and Availability
Bank transfers also can get complicated if the sender and the recipient live in different countries and use services of two different financial institutions. In such cases, the period of time which passes before the money is sent and until it arrives can last for more than a week. It can be bearable for individual clients but absolutely intolerable for organizations and businesses. Blockchains do not see any borders, that is why a person сan send crypto from India to the US, and it will arrive in much less time, depending on particular crypto.
Cryptocurrencies are also available for purchase on numerous exchanges, and there is no problem for any person to purchase the desired sum as long as they have an Internet connection.
How to Take Advantage of Crypto Benefits
Pay with Crypto
As it was mentioned before, nowadays, many people view cryptocurrencies only as investments and thus hold them in their wallets and avoid spending them. Yet, paying with crypto can be a much more pleasurable experience. With the help of crypto, they can buy products at various vendors from different parts of the world and be certain that their payment will be processed in a short period of time. Additionally, they can stay completely anonymous, for instance, when obtaining a subscription from an adult-content website such as Pornhub. Crypto also grants its holders complete ownership, and one can be sure that no one will take their coins from them.
Perhaps, right now, businesses are potentially the biggest beneficiaries of the booming crypto market since the number of companies that accept crypto is still quite small. The crypto community, on the other hand, is giant; Bitcoin alone has a market capitalization of more than one trillion dollars. In other words, the demand for companies that welcome crypto investors is extremely high while the supply remains surprisingly low.
If you own a business and want to gain a competitive advantage, then you could accept crypto payments for that. For instance, you can use a simple tool of crypto invoices which will let you receive crypto from your clients in an effortless manner. There is also an opportunity to accept crypto but receive the sum in any type of currency you want, including dollars and euros. Non-profit organizations and bloggers can accept crypto donations by placing a widget on their web page. All of these and many other crypto payment options are available to NOWPayments clients.
Cryptocurrencies are the talk of the town, and many people want to capitalize on their success by investing in them. Yet, cryptocurrencies are also perfect means of transferring value and possess multiple benefits. They are anonymous and secure, no banks oversee them, and users can transfer crypto seamlessly in short periods of time and at small prices. Cryptocurrencies are extremely advantageous to businesses, and NOWPayments can help them start accepting crypto payments.