Bitcoin – A Parallel Currency for Digital World

April 13, 2020

The whole world then discovered that a parallel payment system existed around this international currency, independent of any central bank and of a regulatory authority such as the European Central Bank or the Banque de France. In 2013 alone, this cryptocurrency, which allows anonymous exchanges and without a banking intermediary, experienced two surges in its course before falling again. Experts estimate that 12 million Bitcoins are currently in circulation.

Despite the risk of a new Internet bubble due to its volatility, investors in the physical world and commercial sites are interested in this virtual means of payment. For example, the American online sales site Overstock, a competitor to the giant Amazon, has decided to accept Bitcoins. Both the Federal Reserve (Fed) and the German government recognize an interest in this digital currency for the future. A very first Bitcoin distributor was even installed last October in Vancouver (Canada) before New York followed in early 2014.

How bitcoins are issued, what is the risk of a virtual currency, will Bitcoin become the international currency of the new digital world? Explanations with Philippe Herlin, author of the first work in French dedicated to this monetary phenomenon: “The revolution of bitcoin and complementary currencies. A solution to escape the banking system and the euro? ”. Convinced of the financial revolution in progress, this independent economist is already talking about digital gold”.

An autonomous and theoretically secure system. The Bitcoin protocol, i.e. the transaction system through which the eponymous currency transits, is based on a complex network where all transactions are decentralized (with no bank as intermediary) and public. The creators wanted to develop an open-source peer-to-peer network exchange system (each client is also a server) without regulatory authority. It’s like a memo that goes from office to office and will be stamped to mark its passage. Each exchange is listed live on a site, so it’s easy to see how much a Bitcoin address has sent to another Bitcoin address. This prevents the creation of fake Bitcoins, since its holder will not be able to prove its origin.

Anyway, the number of Bitcoins, generated by a computer process, is already limited to 21 million units, a threshold which will be reached according to the expert in 2020

While crypto-currencies always fascinate investors who follow the impetuous prices of virtual currencies

ENCRYPTED CURRENCIES SURVIVE AND PREVAIL IN ONLY CERTAIN SECTORS

In this second scenario, we start from the point of view that encrypted currencies will continue to coexist with conventional currencies, governed by the major central banks, but will not take the development to which they are predestined.

Very useful virtual currencies in certain segments of the economy

Even if, in this scenario, crypto currencies remain in the shadow of traditional currencies and remain niche currencies used by geeks, it should not be forgotten that active crypto could still be successful in certain areas. Thus, cryptoactive could well impose itself in certain sectors where they will prove to be very useful and in particular in finance where ICOs will continue to make it possible to raise funds and digital assets of the Blockchain.

Global success of virtual currency with individuals

Individuals adopt cryptocurrencies. We can note that currently, BitcoinEvolution are popping up everywhere which allows making money. The cryptocurrency revolution already seems to be well underway!

It is therefore quite possible that the whole population uses cryptocurrencies to settle their purchases in everyday life, but they could also use Blockchain technology for all kinds of everyday applications like recording transactions and proof of real estate, act as a receipt at the supermarket and save paper, record medical history, etc.

Cryptocurrencies are independent of monetary and financial systems

The characteristic of cryptocurrency, until today, is their independence from central banks. They are not regulated, do not depend on a state and cannot be manipulated by an unscrupulous government.

On the other hand, this characteristic may only concern in the future part of the virtual currencies which will be separated into two groups: those regulated by central, state, and other, private banks. Indeed, several states, like France or Russia, have planned the launch of a state token. 

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