Page 46 - Payout Magazine Online Volume 8.8

bitcoin:

Is It Challenging

The Financial

World Order?

ot since the burst of the dot-com bubble While investors build up their cryptocurrency The antiquated global financial system is
nhas the world’s financial stage been collections in digital wallets and watch the daily suffering from information overload as banks
home to so much drama as has been stirred trends in the hope of scoring a big payday, it’s attempt to fix an aging paper-based system
up by the rise of cryptocurrency, with Bitcoin the technology behind Bitcoin that is quietly with digital band-aids. Banks are centralized
blazing the trail. Cryptocurrency promises a leading the revolution, as it has the potential by nature, which not only makes them highly
new world order of finance, with the ability to to upend the world of finance like no other valuable targets for a crime but also inherently
trade ones and zeros stored on a computer for technology before it. difficult to change. However, blockchain could
physical goods and services, while keeping all be the technology to finally bring the world’s
transactions secure and untraceable by the Hidden beneath every Bitcoin exchange is a financial system firmly into the 21st century.
world’s regulatory bodies. technology known as blockchain, a distributed
ledger, time-stamped database running on It’s not just financial industries jumping
As is so often the case with new trends and millions of computers spread across the globe. on board with blockchain, as they attempt
technologies, the failure of cryptocurrencies to Blockchain technology has the potential to to streamline their systems and create new
live up to the hype dominates the news cycle; store information about anything of value revenue streams while also reducing their
however, cryptocurrencies are not without including money, titles, equities, contracts, operating costs. Entire countries are also
their problems. For instance, the cost of a bonds, and deeds; basically, the full gamut of looking towards blockchain for implementing
Bitcoin exchange alone means you could be asset types. national cryptocurrency systems designed
paying four times more for your morning coffee to supplement their fiat currency at first, with
and waiting up to an hour for the transaction The current banking system has several the possibility of replacing them entirely in the
to finalize. weaknesses which add up to costs and future.
delays, and a high potential for fraud and
With such an inefficient and expensive crime. Over the course of a year, almost half Money has always evolved according to the
payment process, cryptocurrency has taken of the world’s financial institutions such as needs of human societies. It has grown from
on a financial role which has more in common the stock exchanges, payment gateways, and trading crops and livestock to the much more
with gold bars hoarded away in safes, than it money transfer institutions fall victim to crime. manageable paper and plastic notes we carry
does with the coins and notes in your wallet. In response, regulatory costs keep spiraling in a physical wallet or purse. Today’s world
However, cryptocurrency is still a babe in the upwards and eating away at the nest egg of sees most financial transfers happen as digital
woods when stacked up against the centuries- individual consumers, who will always end transactions zipping back and forth through
old banking system, but wrinkles are sure to be up footing the bill for a financial institutions modems and servers across a vast global
ironed out as the technology matures. inadequacy. network infrastructure.

46 PayOutMagazine