The path towards a digital economy is one that has not been treaded on so far. The progress has been pretty slow. But most of the major nations in the world are now steadily advancing towards the digitization of economy. Digital economy would in turn result in an improvement in the economy of the developing nations and can also have a huge impact on the world trade. While some countries have already incorporated measures to reach the goal there are some that are still struggling with the conventional methods. The penetration of technology has made the whole process simpler and more manageable. While there are many technologies that are known to impact the economy of any nation Blockchain is known to be one of the most influential tech till date.
There are some countries that still fear embracing new technologies. The fear however is now slowly being replaced by the enthusiasm to try the new and to strive to stay ahead in the race. The political leaders of the nations play a major role in the acceptance of the technological advancements. As influential leaders they would be able to influence the perspective of the citizens, for good. That is where the real difference lies. If you have been following the domain of crypto currencies you would be aware of the fact that crypto trading has been one of the most lucrative fields in the recent times. Some early investors in crypto currencies made millions of dollars in a matter of a few years. What started as tokens to denote some crypto assets slowly grew in value resulting in multiplication of the invested amount thus making the investors rich in no time. While some countries looked at this situation as a threat, some came forward to incorporate regulations to channelize the process and to strike a balance. These are the countries that understood the fact that regulated crypto trading would in turn improve the economy of the country and also result in a reduction in the number of fraudulent activities.
The concept of transferring information, knowledge and content over the internet, has prevailed for several decades now. But the concept of transferring value without actually owning a physical asset denoting it is something that is just catching up. The comprehension of the Blockchain technology might look daunting at the first glance. But if you ponder over the benefits and the influence of this technology on the finance sector you would realize that this is going to be a super power that helps emerging economies as well as the global economy on the whole.
Venture capitalism scenario is changing
The trend of increasing number of startups is good for the economy. But even the strongest companies might reach a point where there is a crunch of funds. Venture capitalists have been the most popular and the most dependable option for most startups. But to find a reliable venture capitalist there have been situations where startups have been forced to move out from their place and reestablish themselves elsewhere. When this happens too often and when more number of companies move out it would have a detrimental effect on the economy of the country. That is where the ICOs come to the rescue. ICOs or initial coin offerings are compared to IPOs very often. But these are two very different events. ICOs are where a new venture would be able to offer some of its crypto assets to the investors in the form of digital tokens in most cases. Based on the growth in value, the increase in the demand for these tokens, the value of the tokens as well as the acceptance of the tokens in the market would all vary. That is how less popular tokens grow to become globally accepted crypto currencies. So ICOs make it easy for the startups to stay where they are and raise the funds that are needed. When the startup grows the economy of the country grows as well.
Blockchain is not just for crypto currencies
Blockchain technology is something that would benefit not just the crypto currencies but also the FIAT currency system. A majority of the financial institutions of the world have announced their interest in crypto trading. A large number of Fintech companies are also taking interest in Blockchain technology to improve the security and to create a robust system. Blockchain reduces the need for third party involvement in the interactions. When a middleman is not involved it cuts down the possibility of adding another weak link. With the decentralized system the problem of a single point of failure causing the whole system to crash and the data to be lost, would be avoided. When banks and other reliable financial systems start relying on Blockchain technology to manage both crypto currencies and the FIAT currencies then money management would become much simpler. This would make it easier to create digital versions of the popular currencies and result in easier money transfers. Fund transfers besides being quick and convenient, would also become more secure. With the ease of financial transactions and the reduction in the dependencies countries would be able to keep a check on the inflation rates. Financial crisis situations would be easier to tackle when the digital funds are securely transferred.
Crypto craze is not going anywhere
This is a bubble that is not going to pop anytime soon. Crypto currencies have been identified as some of the best investment opportunities. There are scams. There are ICOs that can lead to major losses. But if you choose the right crypto currency exchange then you would surely end up finding a great place to invest your money and you would be able to watch your money multiply. When the people get rich the nation gets rich as well. Digital economy is being fueled by the security layer added by cryptography. People are afraid of going all digital because of the fear of cyber attacks. What if a hacker hacks and loots all your digital currencies? That is where choosing a reliable crypto currency exchange comes into the picture. So, nations that implement regulations in order to improve the credibility of the exchanges, would be the ones that notice a better growth in their economy. When the way the financial transactions occur is reformed then there would be a change in the economy. When major revenue earning industries like the supply chain domains transition to the blockchain era there would be a change in the economy. In short, with Blockchain transforming almost every industry it is surely going to play a strong role in hastening the progress towards digital economy.