Last time, we opened a bit on what cryptocurrency is, as well as Bitcoin and its advent. Well, today, we will be comparing Bitcoin to the United States Dollar.
First, we understand cryptocurrency to be, put quite simply, a digital currency; while the US dollar is an official currency backed by the government, as are other government-backed national currencies. We are going to attempt to address the differences between both currencies.
1. In link to what is a cryptocurrency, we discussed how cryptocurrency is decentralized (it is not owned or regulated by any known or centralized authority). Well, when it comes to the US dollar, the difference is quite clear. The dollar is owned and regulated by the United States government.
2. Another obvious dissimilarity between the two currency forms would be tangibility. While you can hold on to the dollar note, touch, and feel it, if for any reason you find yourself holding onto any cryptocurrency, you’ve been had! Cryptocurrency is only digital, while the fiat is both digital and tangible.
3. Again, the various cryptocurrencies have a limit to the amount that could be in existence, while the dollar has an unlimited supply which means the central authority has no cap to the extent to which they can produce money.
4. Since we have clarified and emphasized the digitality of cryptocurrency, it goes without saying that the method of storage would be digital as well. Making use of digital wallets (cryptocurrency wallets). This is not so with the dollar, which leans on the existence of banks and the Central Bank.
5. Also, transactions using the fiat currency (dollar) can be reversed or charged back. This is seldom so when it comes to cryptocurrency.
In our current clime and time, though, both serve as a means of exchange and a store of value, whilst relying on widespread consumer use for proper functionality. This is the most common similarity between the two currencies.
We have come to the end of this week’s edition. Stay tuned for our next blog post coming up next week, it promises to be very informative. To get more information about thenewboston coin, click here or follow us on Facebook, LinkedIn, Twitter, Reddit, YouTube. You can also join the newBoston community here to pitch a project or contribute to existing projects.