How Cryptocurrency Changed the Way We Use Money

Before cryptocurrency came about in 2009, the world was a vastly different place. The way we used money then compared to now is astonishing. In 2009, money was physical, it was paper, it was in your wallet. However, cryptocurrency entered making money digital, transferable, and online. This has led to major innovation in both the crypto and non-crypto financial space. Today, even our traditional banks have online banking systems making money more digital than ever before!

In this article we are going to look through some of the key fundamentals and technologies in the crypto industry as well as how things are expected to change in the future. 

Learn About Stable Coins

A stable coin is a cryptocurrency whose market value is linked to the value of another asset or a basket of assets. Traditional cryptocurrencies have a floating exchange rate in which their price is permitted to vary; stable coins, on the other hand, have a set exchange rate in which a central authority guarantees their price. Tether is the most widely used stable coin, with the Tether Corporation claiming to have pegged it to the US dollar at a ratio of 1:1. This means that, every tether will be 1 dollar. You may be wondering what the point of learning how to spend your cryptocurrency is if it has the same value as a single dollar.

Buying or selling cryptocurrencies with traditional money, particularly in substantial amounts, might result in significant compliance fees. Frequent crypto traders can avoid incurring these expenses by keeping Tethers instead of US currency. Facebook’s Libra, now called Diem, is another well-known stable coin. This is a concept for a virtual currency that would be tied to a basket of major currencies and controlled by a conglomerate of companies led by Facebook. This new currency will become Meta’s primary form of money in the Metaverse. Partly in reaction to the perceived danger presented by private currencies, central banks throughout the globe have begun to investigate how these technologies may be used to construct state-controlled digital currencies.


In 2022, the future of cryptocurrencies may not even be what we know now. The possibility of central banks releasing their cryptocurrencies, known as central bank digital currencies (CBDCs), has sparked a lot of interest. Many people, particularly in government, believe that this tick the boxes of being regulated and controlled, but they overlook the benefits of the new digital age. The Bank of England recognizes that if governance can be acquired and standardized, the doors to these digital currencies can truly open. Only a few CBDC projects have been tried thus far, but many more are in the works. In the early 2000s, advances in the debit card system rendered Finland’s “Avant” digital money obsolete. Uruguay has issued “e-Pesos” as part of a successful trial of the CBDC idea and is presently deciding whether to expand the experiment. The People’s Bank of China’s “digital cash” and “electronic payments” project, which is designed to partially replace physical currency and has been trialled in numerous locations, is the largest initiative in development.

A central bank digital currency (CBDC) is a type of electronic money that is issued by a central bank. What is the benefit of a CBDC when existing national currencies may be exchanged electronically? This varies from proposal to proposal; it might be to provide the public access to central bank financing or to assist the transition to a more efficient payment system. A more ominous scenario is that a CBDC would allow an authoritarian government to use a blockchain to record all transactions for law enforcement purposes. While a successful CBDC would result in economic benefits from a more efficient payment system, a bungled deployment might put financial stability at risk. As a result, central banks throughout the world are treading carefully.

Bitcoin & Blockchain

It is a decentralized virtual currency, or cryptocurrency, described as “a peer-to-peer version of electronic cash that is available for use for online payments to be transmitted directly from one party to another without passing through a banking institution” by its unknown inventor. When you own Bitcoin, you own the key (or password) to a wallet “address” (or account) that contains the virtual currency. By producing a transaction, which is subsequently recorded on an immutable public “block,” Bitcoin may be transmitted from one address to another. These blocks are then linked together to form a “blockchain,” which is a publicly accessible record of all Bitcoin transactions in the past. Think of this record as something like a vast digital ledger.

Will Crypto Pass Fiat?

If cryptocurrencies ever overtake fiat currencies, it will be a watershed moment. One major point is that owing to their decentralized and uncontrolled nature, cryptocurrencies cannot be manipulated as easily as fiat currency. Aside from the fact that cryptocurrencies may be a better fit for a universal basic income than fiat currencies, in reality, some programs have already tried using cryptocurrency to provide a universal basic income. Without the need for a bank in the middle taking their share of fees for completing payments, this might save corporations money while also benefiting consumers. 

According to its advocates, Bitcoin has two benefits over traditional currencies. According to its advocates, Bitcoin has two benefits over traditional currencies. The first is that its supply is restricted, making it difficult for a central authority to devalue it by issuing it in substantial amounts. As a result, it is far less prone to hyperinflationary crises like those seen in Weimar Germany, Zimbabwe, or Venezuela. The second ostensible benefit of Bitcoin is that all transactions are permanent and irreversible. When you store money in a bank account, the bank might seize the funds for various official reasons and following legal regulations. This is impossible with Bitcoin since the database that records transactions cannot be altered by any central authority. As a result, Bitcoin is sometimes referred to as “trustless” due to the lack of an intermediary like a bank. 

If cryptocurrencies outweigh cash in terms of usage, conventional currencies will lose value without recourse and change. If cryptocurrencies effectively fully replace currencies, a newer technology model will be necessary to allow the world to change. Established banking institutions would certainly have to hustle and make massive changes to adapt. 

The Future of Fiat Currencies

The idea of cryptocurrencies receives a lot of attention in the research by Deutsche Bank on the future of finance in the next decade. They point out that this business has historically been viewed as an addition to the global money supply rather than a replacement, but that might change depending on the future of cash and cards. So, while cash will be in a fragile position for the next ten years, which will help cryptocurrencies, there are still certain critical concerns that must be addressed if cryptocurrency is to succeed in replacing the current financial system. They must first establish themselves as legitimate in the eyes of governments and authorities. This entails maintaining pricing stability and providing benefits to both businesses and customers. 

They must also enable worldwide payment market access. To accomplish this, partnerships with major stakeholders are required, including mobile apps like Apple Pay and Google Pay, card companies like Visa and Mastercard, and shops like Amazon and Walmart. They also will have to show the greater population how to pay with Bitcoin in the EU and other regions.  Of course, some of this is already in the works, with Walmart and other forward-thinking businesses, for example, showing interest in blockchain technology. This is for its supply chains, and while it isn’t directly tied to Bitcoin, it is a steppingstone for the next ten years.

If these obstacles are removed, the future of fiat currency is jeopardized. However, additional difficulties would emerge. For starters, it will necessitate relying on power usage to maintain a stable financial system. To ensure a successful transition to a digital platform, the financial system must be prepared to withstand any type of power outage or cyberattack. Governments may find that they need to keep backups of people’s data in different nations more frequently. Estonia, for example, chose Luxembourg to house a complete backup of government data, including health, demographic, and company registers, as well as a data embassy.

2022 Regulations and Changes

In recent years, institutional players such as the European Investment Bank (EIB) have taken positions on cryptocurrency. In April, the European Investment Bank (EIB) issued a 100-million-euro Ethereum-based digital bond. Goldman Sachs and Société Générale were all part of the sale. Institutional adoption has been recognized as a tipping point for mainstream crypto acceptance, and it looks that we are approaching that moment. 

The increased availability of points of sale that accept Bitcoin as payment, as well as institutional investment in the industry, will almost certainly lead to widespread use of Bitcoin as a method of payment in 2022. After cryptocurrencies, decentralized finance (DeFi) is often seen as the next frontier in fintech. DeFi enables the establishment of decentralized systems that make use of distributed ledger technology to enable peer-to-peer lending, new financial assets like stable currencies, and even new corporate governance models. Regulators, however, appear to be paying greater attention. The European Council expressed its view on the Markets in Crypto Assets (MiCA) framework in November, which will bring more legal clarity to crypto-assets and DeFi. Lack of regulation is a key impediment to crypto adoption in the mainstream. Increased government control, along with numerous nations’ consideration of digital versions of their national currencies, is expected to result in a surge in regulatory action in 2022.

Finally, do not fear missing out.

According to research on the behaviour of retail investors, some are particularly vulnerable to the “fear of missing out.” As a result, it may be tough to turn down a tip on the next hot crypto opportunity from your beautician or your best friend’s nephew. If they wish to invest wisely, crypto investors should educate themselves on the technology as well as the fundamentals of financial markets. Remember, risk management is everything and if something seems too good to be true, it probably is.