The first working blockchain was conceptualized by Satoshi Nakamoto (a person or group of people) into Bitcoin, the first cryptocurrency in the world. Two years later, in the spring of 2010, the programmer Laszlo Hanesh ordered two pizzas, for which he paid ten thousand bitcoins as a joke – a little known cryptocurrency then. Had Laszlo held onto this money, today he would have about US$ 95,000,000. Ten years later the entire market of cryptocurrencies is estimated at approximately US$ 300,000,000,000 and its peak was in 2018 with US$ 800,000,000,000 of capitalization. Cryptocurrencies have a lot of benefits. They have:
- Impossibility of freezing an account or state withdrawal.
- Transparency: At any time, the accuracy of any operations can be easily checked;
- The openness of source code. Hacking, faking or performing other similar manipulations with cryptocurrency will not work – it is reliably protected;
- Solved issue of supplying currency. Emission is controlled by source code and decreases over time, third parties do not regulate the emission of cryptocurrency and does not control the movement of funds into the account.
- Raising of capital and diversification of assets. Cryptocurrencies can be used in ICO during the crowdfunding of startups or different projects. More than US$ 11,300 000,000 was raised in 2018 by 2284 ICOs. Also, cryptocurrencies are a great way to diversify financial assets, because classical equities tend to grow or decline with great correlation not reliant on a country.
- Benefits for gambling and betting. Gambling and betting services implementing cryptocurrencies perform with great transparency with absence of fraud from the casinos or from the bookmakers.
- Crypto-fiat currencies, cross-border transfers, minimized fees and time of transaction. There is also the presence of companies that provide fusing of cryptocurrencies and fiat money. These stable coins are not volatile and perform with a rate of 1 to 1. For example, 1 USDT is equal at any moment of time to US$ 1. This brings enormous opportunities for cross-border transfers, reducing necessary time for transaction, from several days to several minutes with absence of any fees.
Companies like Microsoft, JP Morgan Chase, IBM, Ubisoft and Starbucks are already taking benefits from using cryptocurrencies. According to Forbes journal, the mass introduction of blockchain technologies will occur in an interval of 4-7 years.
The Benefits at a Glance
- Crypto-fiat currencies / Stablecoins
- Alternative investments and diversification of investments
- Cross-border transfers
- Gambling and Betting
- Raising capital from ICOs