The Currency Revolution, Courtesy of Bitcoin

currencyrevolutionary23 May 2014 / Money News – Just as cryptography is planting the seeds of a revolution in payment systems, bitcoin and other cryptocurrencies are planting the seeds of a revolution in currency.

First, there are three main characteristics of a currency: 1) it can be used as a medium of exchange, 2) it is a store of value and 3) it is issued by sovereign governments.

As a medium of exchange, bitcoin offers several unique innovations to currency: global nature, infinite divisibility and easy to carry.

Cryptocurrencies like bitcoin are decentralized and therefore a global medium of exchange. As a truly global currency, it could be used without any need for foreign exchange anywhere in the world. The resulting transactions would be nearly frictionless compared with today’s archaic systems and they would complete immediately.

Bitcoin is also created to be divisible to eight decimal places, with the capability for more in the future. Payments can now be made as small as millionths of a penny. Now the monetization of content becomes much easier. Prices previously too small are now economically viable, allowing many endangered businesses to thrive.

Another advantage is that bitcoin is easy to carry. The impact is most felt with amounts of currency larger than your credit card limits. Imagine carrying a million dollars in hard currency. That’s the equivalent of carrying 22 lbs of $100 bills or 770 ounces of gold. But carrying $1 million in bitcoin would be as light as your smart phone.

As a store of value, bitcoin offers a unique innovation to currency: it is solely market-based….. Read more

Follow Twitter

Exchange Rate