In the year 2010, the month of May to be precise, the first transaction with Cryptocurrency occurred. Someone purchased two boxes of pizza for around 10,000 Bitcoins.
This is crazy because that same amount of the Cryptocurrency was worth over $600 Million in April 2021.
Now, the Crypto craze has increased in intensity and usability. There are about 10,500 different Cryptocurrencies with relative value to fiat currency and many merchants now use it for transactions and even for storage of value.
Cryptocurrency meets the specifications of what money should be: it serves as a means of exchange, a store of value and a unit of account. Aside from these, it has also checked issues involved with transacting with normal physical cash. It reduces the need for a third party during transactions and ensures accuracy. Cryptocurrency is not controlled or supplied by central banks, unlike the normal fiat cash we use for transactions mostly.
Well, the fact that Crypto goes beyond the borders of regulations has both good and bad implications. Many countries with devalued fiat use this to business transactions and even savings. Even the Ukrainians have turned to Cryptocurrency because of the Russian military operations in the country.
The use of normal physical cash might be replaced totally by some other stuff but Cryptocurrency posses some problems that is mostly overlooked.
For the now, Cryptocurrency tokens are volatile or unstable. And they rise and fall in value. So its risky to invest in Crypto. Imagine investing in a token when the value stands at $25 and latter getting less than a fourth of that amount due to market shakes. Cryptocurrency has not proven to be a long term investment thing.
Lack of regulations in Cryptocurrency and the anonymity involved has led to scams, money laundering and bankruptcy. Many people think that crypto wallets can’t be hacked but that’s not true.
The most important issue is the energy consumption problems involved with Cryptocurrency use. Bitcoin alone consumes more energy than Argentina, a country with more than 45 Million people. (150 terrawatts-hrs). This creates both economic and environmental problems. Some countries like China, Russia and some E.U countries have sought to stopping the use of Cryptocurrency due to environmental concerns.
We all know that the world’s biggest problem is energy crisis. One reason why a lot of new inventions are not in vogue today is lack of sustainable energy. Some scientists believe that human extinction is connected to energy problems.
New research are being made to reduce the risks involved with Cryptocurrency use, new eco friendly tokens are now being circulated. Well let’s keep our hands crossed to see what the future holds.
