The only kind of digital currency that thrived in this pandemic year is Bitcoin.
It is no surprise that the monetary evolution has accelerated its pace in the pandemic of 2020. Coronavirus has proven beneficial for Bitcoin, and cryptocurrency in general. Pandemic has uplifted the digital world. People who may have never thought of doing online transactions had to try them because of the closed banks. Subsequently, due to the pandemic people discovered more about financial monitoring and frauds. And both of these points were good for Bitcoin.
Moderately Bitcoin is being embraced not much as a mode of payment but as a reserve of value. Wealthy individuals as well as tech firms are investing in it. This first and well-known cryptocurrency broke its previous records and first time close to $20,000. There are mainly three flaws in Bitcoin. First, it is slower as compared to other modes of payment. And if you are willing to buy a Bitcoin, Coinbase will impose 1.49% as commission.
In addition to this Bitcoin’s algorithm needs specifying computer chips that gobble 60 TW-hrs of electricity in one year. Now, this is a lot of energy that can lead to many environmental concerns. Another unanticipated outcome is that bitcoin mining is increasingly accumulated in fewer hands. And a good deal of these people are Chinese or anywhere cheap energy is available.
But these flaws are outnumbered by two special features. Bitcoin gives in-built shortage distinguished by unlimited wealth in the virtual world. And second, the users of Bitcoin can make payments without any mediator such as banks. The advantages are not much apparent but are important. The only kind of digital currency that thrived in this pandemic year is Bitcoin.
On the other side, China is making its headway in two different forms. Because of the rise of Alipay and WeChat Pay, China is at the top when it comes to mobile payments which are happening on a large scale. These electronic payment stages are around $40 trillion transactions in one year. Additionally, the People’s Bank of China has stepped-up the spread of their digital money.
Governments such as India are confronting China’s financial invasion are now creating their versions of e-payment systems as opposed to China. Some economists are welcoming the end of cash because it will make regulation of monetary schemes easier and will make organized crimes difficult. Cryptocurrency does not mean that Bitcoin is out of the hands of the law. Because the federal agencies can track the parties involved in financial transactions of Bitcoin. This is mainly due to the fact that blockchain is a permanent record of the transactions carried out by Bitcoin which is completed with the bitcoin address of both the sender and receiver.