Welcome to the latest insight into the world of cryptocurrencies. We can’t promise much excitement this week, but the items we have prepared have their appeal indeed! The week saw the crypto markets slump yet again. Any surprises? No, we don’t think so. After a somewhat okayish performance the cycle is repeating itself.
Cryptonewest Comment on Crypto Currencies and their Future
We will take a few moments to make a brief comment here. Even though crypto currencies may be hailed as a substitute of much of the common money we use every day. The crypto revolution may have been stalled by quite a hefty bit. Yes, there’s no security in the grand scheme of things and without security, not much can be done indeed.
We have been writing about cryptocurrencies, but have difficulty plumping for them as heavily as about a year ago when we first started. The key reason behind our mistrust is that even the normal financial system is on the ropes.
Howe are we then to believe a completely non-decentralized system?
Let’s be honest here.
With USD, EUR, even the Chinese Yuan we know where we stand. Our money stays relatively the same. We don’t really worry about rapid devaluations every week. Will we be able to afford groceries? Such thoughts never cross our minds.
But let’s carry on. Let’s try to identify the problem.
Why Cryptocurrencies Will Struggle to Take Hold?
Because of the corrupt nature of anonymous financial transactions. When given leeway, people would opt out of many things. If you can’t force the majority to pay tax, not many will do based on their sense of duty to their country.
The simple fact is that when the sure fires are gone, we are all left with the crumbling pieces of something that only has the outwardly look of a workable legislation. And that’s terrifying. But terrifying though it may be, the facts are that we cannot do anything to upturn the nefarious practices of anonymous third-parties. The only way to stop them is not to let them to take hold in the first place.
So how do we do that?
- We establish an international network that tracks crypto payments
- We use a common regulator for the entire world that delegates to local representatives
Do you see the problem yet?
At a time when the United States are gone bonkers, levying foreign imports from ally and ‘foe’, it’s important to see why it’s impossible to aspect cryptocurrencies to break even. Security reasons are also a concern, but let’s ask ourselves quite honestly – how are we going to take the better of ill-meaning third parties.
We can’t, and while the wold is bickering over such inconsequential things as steel tariffs, even though a legitimate concern could be risen out of these, we won’t see a functioning cryptocurrency unit to unite the globe and allow us all to participate in a common crypto trade block.
What about Blockchain?
Blockchain is indeed a great alternative to all our worries. Blockchain is empowering useful and it can make all the difference we want. In a recent report of the World Bank, the advantages of the Distributed Ledger Technology (DLT) have been talked about in detail:
There is an emerging view that the DLT applications in finance that will likely gain traction first will not be payment and settlement systems but instead areas in which there is little automation and heavy use of manual processes with high inefficiencies. Suggested areas that fit these characteristics are: (i) reference data maintenance in payment and settlement systems; (ii) trade finance; (iii) syndicated loans; and (iv) tracking of provenance of agricultural products, commodities and the like and their subsequent sale or use as collateral based on which financing is provided. There are also discussions about applications of DLT as part of the solution framework for de-risking through: (i) reliable and auditable maintenance of identity, including Know-Your-Customer and Customer Due Diligence data;
The plain truth is that blockchain is not so corruptible as are cryptocurrencies. Why? Because nobody has access to the blockchain whereas the cryptocurrencies are public. And it’s in that publicity where the vulnerability arises.
It’s easy to get a hold into the vault of a rich crypto bank and then blow the whole thing. People start losing cryptocurrencies which actually equal real-world money. The upshot? People’s investments diminish. The prospect of re-investing this money is also gone.
And then we stand there scratching our heads and wondering what to do next and how come things have come to this? Nobody knows, it appears! Well, in fact we all do know. We have been complacent with the spread of cryptocurrencies, but have failed to introduce the fail safes necessary to keep the whole industry beating on.
What About the Security Companies?
Security companies have been teeming with life. They have been proliferating at a rapid clip. Why? Because they are necessary. And by necessary we mean that there’s been a lot of breakings into ‘ironclad’ vaults, which were supposed to be nigh-impregnable.
Well, the fact is that such things are not impregnable and hackers will always find their way into hacking millions worth of crypto currency. The pernicious downsides out of this?
We end up complacently feeding corrupt regimes and funding illegal activities en masse without asking ourselves if we can counteract this.
Whilst there are proponents of cryptocurrencies, but there is no global way of controlling the bad players out there, we cannot expect a working solution for any of us.
At Cryptonewest we read and follow the segment with the utmost interest. But the facts are that cryptocurrencies have been facilitating illegal activities en masse. It’s easy to see why they are not everyone’s dearie.
We also maintain that a lot more has to be done on an international level to bolster security. So far, China has been the only country to take the cryptocurrencies segment seriously. It’s not surprising at all they have done so either. With this in mind, we are looking with anticipation towards the future of the segment.