TMCnet Feature
August 09, 2022

How Does Digital Money Revolutionize Banking?



Digitalisation affects everything in our lives — from businesses, to governments and financial institutions. Through the emergence of digital money and digital payments through online banking, so many new opportunities have arisen for companies to innovate and attract consumers.



What is digital money?

Digital currency is all digital. No longer do you need to go to a bank, print off a cheque, or make trips to the post office. Find the money, transfer it from your wallet, and you can use it in a matter of seconds. It's as simple and fast as using a credit card — but without handing over your private details.

How about Bitcoin?

Many might argue that Bitcoin is a digital currency, but in reality it's much more than that. It has created a new ecosystem for the digital exchange of value, spawning innovations such as smart contracts and coloured coins — not to mention kickstarting the blockchain revolution. Today, digital financial services are being reinvented across borders with next-generation payment platforms and applications engineered around open-source protocols. Nowadays, you can buy Bitcoin from any place in the world — online or even through an ATM in a shopping mall.

Cryptocurrency news

Cryptocurrencies prices have been going up and down constantly. While the world is waiting for The Ethereum Merge, the financial world is taking a hit. The truth is, banking has never been the same since 2008 and the aftermath — the emergence of cryptocurrencies.

Just a few decades ago, most of the world paid cash for everyday items — but the rise of smart devices connected to government-issued digital currencies has changed that. Now, new tech advancements are blazing trails in various industries, including retail, with digital currency and mobile payments. More and more people are shopping on Android (News - Alert) phones or iPhones linked to digital accounts, while e-commerce companies around the globe have already started building in support for Bitcoin payments.

Reasons why digital money will replace banking

Dutch Best Bank has already mentioned how cryptocurrency tracking might be helpful for you. But which are the main reasons why cryptocurrency will evolve into more than just "a thing"?

Security

With the ongoing conversation about the relative security of cryptocurrency in comparison to traditional assets, it's becoming clear that this technology is here to stay. Hardware wallets are becoming increasingly popular as a way to keep tokens safe — and they're incredibly secure, with private keys being stored in a protected chip. Plus, unlike many of the offerings available in terms of software wallets, hardware wallets can be disconnected from the internet, making them much more difficult to hack. But even software wallets are much more secure than real money, as you can prevent money theft.

Speed of transfer

There's no reason to wait when using digital currencies! With blockchain-based financial platforms like Ethereum, your bank account will be funded within minutes of sending a transaction. Thanks to technology, you no longer have to wait for ages to get access to your money. On top of that, why get a "no" for an answer?

Transparency

Not to mention, dealings are secure and transparent — transactions are recorded in an immutable ledger, which means that everyone can track how much money you have, what you're doing with it and who sent it to you. There are many banks which get your money but later on refuse to give it to you. No more of that, your money stays yours forever.

Lower transaction fees

With digital currencies like Ethereum and Bitcoin, you can send money instantly to anyone in the world. While some people still have trouble understanding how it all works under the hood, there are many benefits to this kind of service — not least of which is no more bank fees or monthly service fees. All that's required is an internet access and a little knowledge on how cryptocurrency works.

Reliability

We need to be honest and admit it — many stores don't like chargebacks. Customers can abuse the banking system pretty well. This is a red flag for many small businesses who are struggling to prove they delivered their products. Cryptocurrency transactions are immutable which protects sellers. Since every transaction is tracked, nothing can be skipped.

What's the future for banks?

Banks are in a very tricky position nowadays — as industries like FinTech keep on expanding, all of the old methods seem to stop being effective. To keep attracting loyal customers, banks have to adapt and be ready to embrace the future before it's too late — or they might find themselves at the bottom of the food chain. With digital currencies on the rise, we are yet to see the best of them.



» More TMCnet Feature Articles
SHARE THIS ARTICLE

LATEST TMCNET ARTICLES

» More TMCnet Feature Articles