Cryptocurrencies: are they the money of the future?
Have you heard of cryptocurrencies or digital money?
To begin with, how does what we call money arise and how was a form of payment made?
It began with barter: one product that is exchanged for another. A consequent evolution, even without monetary exchange, is bartering from a reference value or a good as a means of exchange, for example: a hen that could be valued in two sacks of wheat, 2 hens could be exchanged for a sheep , which is valued in four bags of wheat. This is known as commodity money. Using a good as a medium of exchange made the whole process much easier. But it was necessary to find a reference good that was easily transportable, durable, divisible and with a set value: precious metals, particularly gold, became that reference value. So much so that metal coins began to work for their ease of conversion and stacking. Being made of silver, gold or copper, its reliability was beyond doubt, although each society minted it to standardize trade within its borders. Europeans were among the first peoples to produce standardized and certified metal coins, such as the Greek drachma or the Roman denarius and aurus. Over time, the coins were made with less noble materials and that weighed less in the pocket, but backed by a tangible good that sustained the confidence of the issuer. This model was in force for centuries and was institutionalized in the 19th century with the gold standard as the reference metal to establish the value of money.
Money continues to evolve. For years, and in parallel with the digitization of society, various electronic payment methods have emerged with force, which emerged in the 90s. This type of money can be used to pay for goods and services through the internet or other means electronic Once the buyer's authorization is received for the payment to be made, the seller contacts the issuing bank and receives the transfer of the corresponding amount. The latest evolution of money is cryptocurrencies, which are digital means of exchange. It is a virtual currency that uses digital encryption in its operations, such as money transfers or the payment of a certain product or service. The first cryptocurrency, and the most popular for now, is Bitcoin, in operation since 2009. Since then, many others have appeared, with different characteristics and protocols such as Litecoin or Dogecoin. These types of currencies only exist on the web and their value is sustained because there is a buyer and a seller who support it for a given transaction, anywhere in the world. Its use is still a minority, but it is continuously growing. To operate they use high security encryption. Although the impact of cryptocurrencies is still miniscule compared to traditional currencies, in the last three years it is estimated that it has grown by 120%, which is why opinions about its future are emerging. While some see their progress as an omen of their future dominance in global transactions, others estimate that although they will not disappear in the coming years, they will continue to have a limited management niche.