Cryptocurrency – one word brings controversy and a new technologically advanced currency to this time period. In one word, cryptocurrency is the possibility of making thousands of dollars with one investment and losing thousands of dollars with the rise in cryptocurrency scams. In America, cryptocurrency is looked at as a financial asset and is emerging as a day-to-day way to pay for everyday items with Whole Foods, Starbucks and Etsy. Cryptocurrency is starting to be adopted on a widespread scale, but it still needs time to grow before heavy adoption will happen. The direction of that said adoption is still to be determined. 

Cryptocurrency challenges the central banking system, which increases adoptability in developing nations and opens up new markets. 

Central banking is “essential” to a country’s economy, but is it? The importance of central banking comes from the idea of one system being in control. In the United States, the Federal Reserve controls the interest rates and money supply, ultimately controlling economic stability and instability. This ability of one power to dictate policies builds trust in individuals that it is monitored, but with a central banking system, economic policy has the power to cause issues that have a ripple effect (Great Depression). 

The fundamentals of cryptocurrency challenge the entirety of the central banking approach. Without one system, it allows for the individual to be in control. With one click of a button, someone can send a transaction, invest and trade crypto. Because it lacks a centralized system central banking becomes obsolete. The lack of central banking leads to cryptocurrency emergence in developing nations’ economies. 

The fastest-growing adoption of cryptocurrency comes from places whose national currency has dropped over 50% in the past ten years, according to a study done by Gemini. This is due to the accessibility of cryptocurrency being digital, and with many developing countries taking hard hits financial individuals have been more inclined to look at crypto.

One of the attractions of crypto in the Middle East, Africa and Latin America is that middle and lower-income individuals can start to have a cut in the financial systems. In many of these places, those who are of the upper class are the ones who are able to open a banking account and reap the benefits of the economic system. By cryptocurrency being accessible through the digital space it allows people everywhere to be part of the e-commerce market and build a portfolio- no matter the economic status of an individual. 

When everyone is able to have a part of the pie, political forces are made to start bringing diverse voices to the table of economics. Cryptocurrency is able to give everyone a piece because it is separate from the bank and the currency of the state-cryptocurrency has the power to level the playing field. 

Cryptocurrency is not the end-all-be-all currency for the world and having centralized banking systems are still a necessity to maintain a government’s economy. The strength of crypto technology is being able to offer an alternative to dwindling national currencies. In developing countries crypto has become a necessity to uplift the way of life and bring people out of poverty- this is where cryptocurrency is lending a helping hand to the world.