Online currencies have become more common in recent years. Why is this? Is this a positive or negative development?

Digital
currencies
have gained additional attention in the
last
few years
although
they have been in existence for more than a decade. In my opinion, it is a good sign from a future perspective,
however
, the concept is not yet mature enough to adopt immediately right away and get rid of the entire dependency on paper
currencies
.
Additionally
, there is a lot of scope for enhancements in order to become reliable and overcome a few drawbacks. One of the obvious benefits is it can be used virtually online and does not require us to carry it physically in wallets
while
shopping in the stores.
Instead
, there is a digital or electronic wallet with a decentralized mechanism that helps to store and access easily whenever it is needed.
Additionally
, a few
currencies
support the concept of smart contracts with which almost every functionality that a financial institution performs today can be achieved.
For instance
, cryptocurrencies
such
as Ethereum and Cardano have already been implemented with which people can get loans or raise funds for an investment or a business and many more things can be done by making a smart contract agreement between the parties.
In addition
, all of these digital transactions are extremely swift and secure with proper traceability
along with
cheaper resource consumption.
On the other hand
, there are a few drawbacks
such
as the highly volatile prices and the huge amount of corrupted black money involved in
this
market
due to
no regulations in many nations and
also
has no global acceptance on these yet.
However
, few countries have already started enforcing the tax rules since 2021. In fact, a country like El Salvador already adopted
bitcoin
Capitalize word
Bitcoin
show examples
as its national currency. In conclusion, online
currencies
are the way to go forward across the entire world with their huge potential,
nevertheless
Add a comma
nevertheless,
show examples
there are a few major developments needed to prevent price volatility and illegal usage. In order to accomplish that, government authorities must step in and regulate digital currency trading platforms appropriately.
Submitted by prudhvi.pinninti18 on

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Topic Vocabulary:
  • Digital wallet
  • Decentralization
  • Cryptocurrency
  • Blockchain
  • E-commerce
  • Fiat currency
  • Financial inclusion
  • Cross-border transactions
  • Volatility
  • Smart contracts
  • Decentralized Finance (DeFi)
  • Mining
  • Energy consumption
  • Pseudo-anonymous
  • Regulatory challenges
  • Financial privacy
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