The Future of Cryptocurrencies: what are the challenges and advantages

Charlie Taylor

Nowadays, we have some very important tools to optimize the cryptocurrency ecosystem. In this article, I seek to clarify possibilities. So I decided to talk more about the future of cryptocurrencies and their main challenges.

The evolution of money

We can go back a little bit in time, in the mid 70's or 80's, at a time when many believed that the creation of digital currencies was unreal, others said that it was impossible for money to evolve to the point that we witnessed that something digital could have more value than a physical paper currency note. Clearly, we can see in the century that we live in the evolution of money and digital currencies that began effectively after the creation of Bitcoin (in 2009), and since then its adoption has been substantial, and consequently, it has driven the first steps of the creation of Central Bank Digital Currencies (CBDC's), such as the digital yuan and stablecoins. Thus, I intend to clarify the main challenges about the future of cryptocurrencies and to clarify why the digitization of money is almost inevitable. In this way, we will discuss several issues and taboos that may be impediments to disruptive technologies being adopted massively, political and socio-cultural challenges and changes that can be positive or negative in certain circumstances.

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Will the money be fully digital soon?

Obviously, we cannot say whether our money will be fully digital in a very short time, but we can see that large banks, institutional investors and governments are studying the technology of cryptocurrencies in detail. In this way, we have identified a huge market interest in accumulating more Bitcoin fractions and companies from various segments experience a practical application of blockchain technology in business. Thus, scholars and enthusiasts of technology and cryptocurrencies are emerging all over the world, statistics warn us that the fundamentals are increasingly solid and positive opportunities in the long term. For example, we can conclude that the cryptocurrency Bitcoin enabled earnings 12 times greater than JPMorgan in a two-year period (Bitcoin generates a return of + 81% and JPMorgan of + 6.3%, according to data from Statista). Consequently, cryptocurrencies become a positive attraction for developing countries and those with economic problems like Brazil, Venezuela, Argentina, Sudan, Angola and Zambia for example. After all, they enable financial returns for their buyers and increase the purchasing power of people who can use decentralized, global money. Thus, we can clearly come to the conclusion of the great interest in digital payment technologies, opportunities for growth and popularity of cryptocurrencies around the world. In China, for example, digital payments are a reality, the acceptance of the population in the face of disruptive technologies has increased exponentially. Anyway, we see that the use of payment applications and the advancement of digital currencies (centralized and decentralized) allows us to visualize the future of increasingly digital money. After all, even if some countries do not yet have clear regulations on the use of cryptocurrencies and digital assets, we see a very promising future for payment methods based on technology, disruption and the demand for more sophisticated levels of privacy and information security . We understand that the evolution of studies on the future of money is constantly on the rise, but we still cannot say how long our money will be completely digital. Through some information, data from the finance / payments market we know that we are heading towards a true revolution in the global monetary system that remains silent and agile.

The dilemma, fear and misinformation

Currently, we can see that the internet is made up of several good and bad content. Thus, erroneous information is transmitted by criminal companies about bitcoin or other crypto. The misinformation ignores the concept of blockchain technology, its reliability and the decentralization of the main cryptography, therefore, they are not controlled by any company or state agent. There are many serious companies, regulated and operating according to the legislation of each country. Unfortunately, companies that promise exorbitant returns and use persuasive devices to steal customers' cryptography end up causing people fear about the technology and how it should really be used, top good personal security practices and emotional intelligence to deal with volatility . Therefore, knowledge about how it works, how to use it, how to store, transfer or pay with cryptocurrencies needs to be transparent and in a simple way. After all, wisdom and responsibility towards finances and better conditions of prosperity begin with the application of rational and individual information.

What is the difference between centralized and decentralized cryptocurrencies?

Digital currencies, tokens or digital payment systems serve the purpose of a valuable asset that has characteristics, rules, freedom and technical differences. But even if there are divergences between centralization and decentralization, the market continues to grow exponentially. The centralized side always seeks to comply with regulators and to work in collaboration with the existing financial system. On the other hand, you have cryptography from decentralized entities in the world, which are not subject to the rules of the centralized universe. We can see that changes occur in various systems for exchanging, selling or distributing an asset, even when we consume a song. The tendency is for everything to become more digital in our lives, after all, technology is very useful in exchanging digital assets and / or files between peers. At the present time, we live in a historic moment in the global monetary system and its evolution in the face of all the technology we have. The traditional is that the money is controlled by a few, the state entities establish the currency and its distribution in the country. Decentralized cryptocurrencies return control and power to people on an equal basis. After all, cryptocurrencies come into play at the right time to change the money we know. In the decentralized world, money is free and controlled by everyone in the ecosystem according to the law of supply and demand. Clearly, we have some challenges and we need to overcome them so that everyone can act in the market and be part of this ecosystem in an ethical, complete and intelligent way. So, you can view some of the main guidelines behind the complexity and innovation characteristics of something as recent as cryptocurrencies.

Challenge 1 ~ Technological and Financial Education

Globally, financial education still needs to be applied more carefully, especially in developing countries. People are approaching knowledge about finance, digital assets, portfolio and custody, for example. But there is a difficulty that requires a substantial change in people's minds about the importance of financial freedom, control of spending and risks. Thus, with enough discipline it is possible that something so disruptive will continue to progress exponentially. Getting people closer to the crypto market will only be a matter of time, and so that we can see a big change. A study of the Cambridge University shows that over 101 million Bitcoin wallets were registered in 2020 alone (Source: Global Cryptoasset Benchmarking Study). This means that people are increasingly interested in cryptocurrencies, but some studies by the company Cane Island Digital Research (CIDR) reported that since 2010, about 4% of the BTC in circulation are lost annually, due to lack of knowledge, shipping errors. , death of the holder or other unknown causes.

Challenge 2 ~ Accessibility and Social Inclusion

Currently, statistics tell us that access to the internet is gradually becoming more accessible, but many countries still do not have as many people connected. According to global data from Statista (July, 2020), approximately 4.57 billion people were active Internet users in July 2020, covering 59% of the global population. The cell phone has now become the most important Internet access channel in the world, as mobile Internet users represent 91% of total Internet users. Therefore, we can conclude that 41% of the world population still does not have access to the internet, this is a reflection of social and class differences, after all, many places around the world still have very precarious conditions. Thus, we need to think deeply about solutions that can contribute and generate technological inclusion and bring more people to the internet, a fundamental pillar in modern society, and thus, reach the most deficient strata in socio-cultural and economic aspects. According to World Bank scientific studies, globally, the loss of wealth in human capital due to gender inequality alone is estimated at $ 160.2 trillion. People of African descent continue to experience significantly higher levels of poverty (2.5 times more in Latin America) and 90% of children with disabilities in developing countries do not go to school. Thus, we see that it is essential to generate more social inclusion and visibility for projects that allow and seek to expand ways of obtaining better conditions of prosperity for everyone around the world. Currently, we can see open platform projects like Celo.Org, in order to unite tools and independent organizations involved in the same purpose of creating technologies that are accessible to everyone with a smartphone. That way, everyone will be able to know how much cryptocurrencies have changed the way we can relate to money. Thus, paradigms need to be constantly broken and with the help of the internet, payment mechanisms based on trust and security such as digital banks, fintechs and cryptocurrencies may be able to embrace an even larger share of the market.

Challenge 3 ~ Usability and Regulations

In 2020, the main cryptocurrency brokers in the world reported a growth of between 15% and 30% in registrations compared to the monthly average registered in 2019. Clearly, new users signing up with digital currency brokers do not necessarily mean more active customers. Anyway, in Brazil, for example, the Brazilian company Cointrader Monitor collected data from exchanges in the country and they declared to have handled 395,209.48 BTC in the period from 1/04/2019 and 03/31/2020. See in the image some differences between fiat currencies and cryptocurrencies:Differences between Bitcoin and fiat moneyBitcoin: a currency created to be decentralized, distributed computing. The transactions only involve two parties, it does not require intermediaries. Cryptocurrency is governed by a majority rule (network consensus). Depending on the speed of the network, the transaction takes place in minutes. It is not possible to have a chargeback or chargeback after the transaction has been made. Fiat Currency: the currency is issued by governments and controlled by central banks, an institution such as a bank, means of payment or intermediary is needed to make a financial transaction. It is possible to get chargeback or reversal of payments that have already been made. Local and international transactions can take several days. In addition, many scholars on digital payment methods have already realized the efficiency, security and quality of cryptocurrency technology and decentralized finance. So we can have statistics that show that paper money is doomed to fail. Periodic studies are positive!

Challenge 4 ~ Credibility, Trust and Privacy

Throughout the history of Bitcoin, there have been many cases of money laundering, use for buying drugs on the dark web, among other negative use cases for the reputation of cryptocurrencies. Therefore, some people still have a distorted view of digital currencies, but crimes and cases of corruption occur quite frequently with fiat currencies. Fortunately, cryptocurrencies are gaining a lot of confidence and credibility over time, after all, many serious projects they won the battle, joined the regulators and work honestly and transparently, which is essential for such a new market. Glassnode, a company specializing in the crypto industry, was able to account for the number of wallets that have at least 0.1 BTC. After the calculations, the study came to the conclusion that, today, there are 3,054,282 portfolios that fulfill this requirement. According to Coinmetrics, Bitcoin has already exceeded 30.45 million registered wallets on blockchain in 2020. Volume of Bitcoin trades in each state currency.Volume of Bitcoin trades in each state currency. Source: Research Gate. The biggest challenge of all is people's privacy and how to ensure data security. In addition, the government with its abusive taxes and meaningless rules believes it has an ethical right to control society's financial movements. Thus, using blockchain, society can be intelligently organized freely and without government influences and with more security, enhancing the evolution of technology and philosophy, and of course, fundamental things for the effective strengthening of human rights.

Challenge 5 ~ Visibility of Innovative Businesses

This is a challenge that requires more efforts from the ecosystem, a lot of professionalism, high-level information and better quality of existing projects, in order to solve the real problems of society. In this way, alternative points of view and intimate relationships with major players in the traditional sector also generate more visibility for the cryptocurrency market, and thus, companies that create simple systems for usability and reliability, and of course, which are constantly optimized, conquer curiosity. of people. And clearly, projects that value decentralized information have attracted attention and attracted the interest of society. Despite all the threats, there are incredible opportunities for innovative businesses that know how to act rationally and respect their customers. There are many associations, startup accelerators and venture capital programs for innovative businesses in the world, and we can see that the valuation of such businesses is growing immensely. This is an important sign, after all, innovative businesses in the cryptocurrency sector receive more notoriety and respect, the market grows and more people are becoming interested in the advantages provided by decentralized finance.


Cryptocurrencies, tokens, decentralized systems and the entire blockchain ecosystem have technological properties and characteristics that are far superior to the fiduciary system. As a result, they are increasingly popular and their mass adoption is closer than we can imagine. In conclusion, a free, open source and decentralized community allows anyone with the right knowledge to collaborate in some way so that complex systems are always better, safe and accessible. Welcome to the Blockchain! Did you like the content? Do you know any more challenges that crypts face? Leave your comment or send a donate! Meet my work, let's chat! Instagram | Twitter | YouTube | Linkedin Also follow Cointimes on social media!Facebook | YouTube | Twitter | Instagram | Spotify

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