No doubt, there is an indication of a growing acceptance for cryptocurrencies nowadays.
The use of this form of currency may only exist on its own digital network, but more people think about it as more than a hype; a ‘flash in the pan’ thing. There are reasons why people may be apprehensive towards cryptocurrency’s complete adoption. For one, they are not in any way controlled by governments. Thus, it makes them a vulnerable medium for illegal transactions like drug trafficking, money laundering, and tax evasion. As a form of asset, businesses can be taxed though, whenever they earn capital gains from any appreciation of its value, but it remains unclear on how they are correctly declared as tax liabilities.
The question is, can they be exchanged for real cash?
The answer is “Yes” but only for near cash values to purchase goods and services offered within digital environment conditions. In other words, with their virtual existence, they can be spent only on goods and services put in sale within the virtual environment. In as much as they are not backed up by governments, cryptocurrencies existence recognizes no border. Without any backing, they can be worthless as it assumes no physical form. Cryptocurrencies are mined and to create them involves a mining process using a mining program that uses advanced algorithms to release crypto money into circulation.
However, the latest developments on the use of crypto currencies have seen many retailers getting on the bandwagon to increase their sales. Major brands such Subway, Dell, Victoria Secret have turned it as a payment option for their customers with some of them adopting a new digital interface where the application works as a digital wallet on their smartphones or laptops using a code that can be scanned into the retailer’s account.
What’s more, Bitcoins can now be purchased through Paypal at the same time process customers’ payments. Firms like Airbnb and Uber also accepts Bitcoins through Braintree, which prompted Paypal to buy Braintree for approximately $800 million in September of 2013.
With the pervasiveness of digital technology, cryptocurrencies may prove to be the biggest threat to real money within a short span of time!