Money, like everything, evolves over time, and today, more than ever, it is clear that money needs to be transformed into a new form that meets the demands and needs of modern times. Let take a look at what form money could take.
Central bank digital currency
At the moment, we have money divided into notes and coins and some digital form that we can store on our bank accounts. It is a system that has been in place for a long time, but it has its advantages and disadvantages. Many of the disadvantages have arisen with the pandemic that has plagued the entire planet since last year.
Many countries began to explore how a CBDC, or central bank digital currency, might work. These days, some states are already conducting pilot tests. This form of digital money is centralised and it looks like it will be the next form of money to be used globally. Countries such as the UK are realising the importance of the new financial system and are pushing ahead with its development. But the truth is that there are many hurdles to overcome.
One of the main problems is that with introduction of CBDCs, there would be no need for the services of commercial banks as a mediator of money between the central bank and the public. The very existence of commercial banks is thus at stake now, because why would anybody pay more for something that could be obtained directly from a central bank? With the use of blockchain technology there would also be minimum chance to defraud money, to use offshore states or tax haven states for avoiding taxes and all transactions would be 100 % secure and transparent. However is that really what everybody, including commercial banks or large corporations want?
There are alternatives
There are alternatives to everything. Decentralised cryptocurrencies, or semi-centralized currencies based on blockchain, are an alternative to CBDC. Blockchain is decentralised, offering the possibility of transferring funds in a short time, cheaply and without a third party. It means that the responsibility for your money would be shifted from banks solely to you in case of fully decentralized cryptocurrency, or partially in case of a semi-centralized currency, such as PlatonCoin.
PlatonCoin offer the best of the two worlds. It combines the advantages of a blockchain based digital currency and the security of having somebody to turn to in case of a mistake, having an insured digital wallet and more.
If you would like to see how to work with blockchain and how it works, you can try our PlatonCoin (PLTC). You can see what it’s like to work with blockchain, what are its benefits and what are the benefits of digital currencies as well.