The question which is remained in the minds of the cryptocurrency investors for a long period of time is whether money should be only authenticated by the banks or whether independent sources of wealth can also be considered.
Even if Bitcoin does not match fiat currency in terms of a number of transactions but still, it has made normal people rethink the concept of money.
Sooner than later, central banks all over the country will be forced to decentralize the currency which they have complete control over. This will ensure that money is controlled by the people rather than the central banks. Only in this way, the central banks will be able to remain relevant over a longer period of time. The best thing about decentralized money will be that it will be a competitor. It will constantly be compared with the other digital currencies which will foster more trade and commerce.
With the help of smart contracts, the volatility can be easily decreased. As a result, international trade will not be impacted at all due to the digital nature of money.
Banks would be out of the equation:
The problem with the current financial system is that banks have a large control over it. The decentralization will ensure that banks do not have a large control over the money. Also, compliance will not be an issue as well. This will mean that individuals will be able to use money in the digital form more easily.
Also, there will be no political risk like currently is present due to the control of the financial system in banks over the money in circulation. This will ensure that the financial system also becomes more stable. When the financial system becomes more stable, events like 2008 will be avoided as well. This will ensure that the entire financial systems become more trustworthy.
This, however, cannot happen overnight. It will be achieved in a phased manner. Only when it is achieved gradually, the changes can be incorporated by the corporations as well as the small business owners. Up until that time, it will be necessary for the central banks to incorporate these changes over a period of time. Only when that happens, it will be easier to make the Fiat currencies more relevant. This will also arrest the increasing influence of cryptocurrencies to a certain extent since the Fiat currencies will also be present in the digital form.
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