Wednesday , May 19 2021

Bitcoin compared to other currencies and payment systems

Bitcoin claims to be a pioneering means of payment in the digital age. Based on its numerous advantages, it can be seen that this claim is anything but exaggerated. Anonymity, protection against forgery and a high transaction speed are just three good properties that Bitcoin combines. The question is whether Bitcoin can hold its own in comparison with other, conventional currencies and transfer systems. 

The advantages mentioned already reveal various differences in relation to normal currencies and payment systems. Bitcoins, for example, can be transferred faster than with a conventional transfer, but they can also come up with a high degree of anonymity. Because behind the Bitcoin there is no central bank and no service provider who could exercise any kind of control function. Bitcoin is in the hands of the community alone. This also means that nobody can be excluded from use. Learn more about bitcoin here .
In contrast to normal currencies, Bitcoins also offer an economic advantage. Bitcoin owners can take fear of inflation with ease, because because of the lack of a central authority, they cannot simply be devalued at political orders. Since the maximum number of Bitcoins is limited, there is a relatively high stability of value, which will pay off in the long term in a rising euro and dollar rate.Bitcoin is also subject to price fluctuations, but these are not based on a more or less controlled increase in money, as is the case with inflation. Bitcoin is also subject to the laws of the market, but not to the will of politics and economic institutions. 
Critics could not wrongly claim that gold is also subject to a high level of value stability. But gold cannot easily be used as a currency in everyday use, so it has a much lower degree of fungibility. In addition, there is a significantly lower availability that the precious metal would bring with it as a currency. This would not make paying with gold impossible, but trading would be more difficult and would also be associated with higher costs, whereas Bitcoins make trading much easier and their use is also possible with very low fees.