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As Bitcoin and other cryptocurrencies have been picking up steam, the focus has turned to blockchain – the underlying distributed ledger technology (DLT) that powers these digital currencies.

Blockchain technology is simple to understand at its roots. The tech exists as a shared database filled with entries that must be confirmed by peer-to-peer networks and encrypted.

It’s helpful to envision it as a strongly encrypted and verified shared Google Document, in which each entry in the sheet depends on a logical relationship to all its predecessors, and is agreed upon by everyone in the network.

Blockchain and its characteristics can provide multiple advantages to businesses — whether they’re using a public blockchain network or opting for private or permissioned blockchain-based applications.

While market forces may compel companies to transform themselves, disruptive technologies like blockchain and artificial intelligence provide a powerful catalyst for change. Just as leading organizations integrated the web into the fabric of their businesses during the internet era, modern companies need to adapt with today’s emerging technologies in mind.

Experts identify the following as the top blockchain benefits:

1. Trust

Blockchain creates trust between different entities where trust is either nonexistent or unproven. As a result, these entities are willing to engage in business dealings that involve transactions or data sharing that they may not have otherwise done or would have required an intermediary to do so. The enablement of trust is one of blockchain’s most cited benefits. Its value is evident in early blockchain use cases that facilitated transactions among entities that didn’t have direct relationships yet still had to share data or payments. Bitcoin and cryptocurrencies, in general, are quintessential examples of how blockchain enables trust between participants who don’t know each other.

2. Decentralized structure

Blockchain proves its value when there’s no central actor who enables trust. So, in addition to enabling trust when participants lack trust because they’re unknown to each other, blockchain enables sharing of data within an ecosystem of businesses where no single entity is exclusively in charge. The supply chain is a case in point: Multiple businesses — from suppliers and transportation companies to producers, distributors and retailers — want or need information from others in that chain, yet no one is in charge of facilitating all that information sharing. Blockchain, with its decentralized nature, solves that dilemma.

3. Improved security and privacy

The security of blockchain-enabled systems is another leading benefit of this emerging technology. The enhanced security offered by blockchain stems from how the technology works: Blockchain creates an unalterable record of transactions with end-to-end encryption, which shuts out fraud and unauthorized activity. Additionally, data on the blockchain is stored across a network of computers, making it nearly impossible to hack (unlike conventional computer systems that store data together on servers). Furthermore, blockchain can address privacy concerns better than traditional computer systems by anonymizing data and requiring permissions to limit access.

4. Reduced costs

Blockchain’s nature also can cut costs for organizations. It creates efficiencies in processing transactions. It also reduces manual tasks such as aggregating and amending data, as well as easing reporting and auditing processes. Experts pointed to the savings that financial institutions see when using blockchain, explaining that blockchain’s ability to streamline clearing and settlement translates directly into process cost savings. More broadly, blockchain helps businesses cut costs by eliminating middlemen — vendors and third-party providers — that have traditionally provided the processing that blockchain can do.

5. Speed

By eliminating intermediaries, as well as replacing remaining manual processes in transactions, blockchain can handle transactions significantly faster than conventional methods. In some cases, blockchain can handle a transaction in seconds or less. However, times can vary; how quickly a blockchain-based system can process transactions depends on multiple factors, such as how large each block of data is and network traffic. Still, experts have concluded that blockchain typically beats other processes and technologies in terms of speed. In one of the most prominent applications of blockchain, Walmart used the technology to trace the source of sliced mangoes in seconds — a process that had previously taken seven days.

Other benefits include Visibility, Immutability, Individual control of data and innovation.

As organisations start to reimagine their futures, they have the opportunity to explore ways blockchain technology can drive growth.

It wasn’t so long ago that the first cryptocurrency, Bitcoin made its way into our consciousness becoming by far the most revolutionary digital innovation in the 21st century. The digital coin, created under the pseudonym Satoshi Nakamoto, was launched in 2009 as a reaction to the 2008 financial crisis that caused a recession. 

Since its inception, its (Bitcoin) price has swung from a lowly $0.0008 to a massive high of over $60,000 in 2021. To put in a mind-blowing context, if you bought 100 Bitcoins in 2010 which was worth a paltry 8 cents then and kept it till now, that Bitcoin will be worth a whopping $4.7 million! Such massive returns within a very short period are almost impossible with conventional investment

READ: 11 Cryptocurrency Acronyms And Terminologies You Must Know In 2022

What Is Cryptocurrency

As earlier stated, the epic financial crash in 2008 has pushed folks to sort for other less controlled financial options which inevitably heralded the era of cryptocurrency. The idea behind cryptocurrency is to create a decentralised system (completely independent of centralised organisations like banks and government) for financial transactions using digital currencies. Over the years, there has been an explosion of digital currencies with different use cases       

Before Bitcoin, there had been previous attempts at creating decentralised digital currencies with ledgers secured by encryption. For example, B-Money and Bit Gold were formulated but never fully developed.

Global Cryptocurrency Ownership

At the end of 2021, cryptocurrency users across the world grew to almost 300 million. If crypto users were a country, it will be the 4th most populated country in the world behind China, India and USA. The global user base of crypto has massively increased by nearly %58000 between 2016 and 2021. It is expected that the total users could explode to 1 billion by the end of 2022 based on projections.

These numbers show the increasing adoption of cryptocurrency for payment transactions and investment purposes over conventional payment methods. It also shows the middle finger given by people to the financial establishment.

Top Cryptocurrency Countries

India has the highest number of cryptocurrency users in the world. The South-East Asian country has more than 100 million users – 33% of the total global users – at the moment. This is followed by the USA, Russia, Nigeria and Brazil with 27 million, 17 million, 13 million and 10 million users respectively according to data made available by Triple-A, a cryptocurrency payment platform based in Singapore.

The data also reported the countries with the highest percentage of users per population. The number country on the list is Ukraine with 12.73% users followed by Russia, Kenya, USA and India with 11.91%, 8.52%, 8,31% and 7.3% user base respectively.

The ease and  

African Cryptocurrency Users

The continent of Africa has seen the most adoption of crypto among developing countries across the world. The continent has seen a 1200%  ($105 billion in market value) increase in cryptocurrency payments from 2020 to 2021. This is not unexpected as Africans daily seek alternate means to bypass the ubiquitous and expensive traditional banking services. 

The cost of remittances to Africa remains the highest in the world. It cost about $18 for an African living abroad to send $200, about 9% on average. The cost within Africa is higher, going up as much as 20%.  Thanks to Crypto, Africans have found cheaper and faster means to send money to their loved ones. Remittance has been the rocket that has propelled the growth of cryptocurrency in Africa.

Another reason Africans have embraced cryptocurrency is the unavailability of foreign exchange to merchants who do business with their foreign counterparts. The forex crunch experienced by some African countries like Nigeria has driven merchants to source them elsewhere prompting them to create accounts on peer 2 peer crypto platforms like Paxful, Remitano and Binance.

The rate of cryptocurrency adoption is expected to be sustained despite the restrictions placed by some African governments. Talking about government restriction on crypto…

Cryptocurrency User vs Central Banks

The reaction of some African governments toward the explosive growth of cryptocurrency in their backyard has been nothing but hostile. Early last year, the central bank Governor of Nigeria, Africa’s biggest crypto market by size, restricted the use of crypto by ordering financial institutions from facilitating cryptocurrency transactions in the country. 

This hasn’t deterred die-hard crypto users as the rate of adoption rose by 10% points to 42% by the end of 2021 effectively rendering the restriction impotent.

Other countries where crypto has been restricted or fully banned are Algeria (complete ban), Bangladesh, (complete ban), Egypt (partial ban), Bolivia (complete ban), China (complete ban), Columbia (partial ban), Iran (partial ban), Indonesia (complete ban), India (complete ban), Iraq (partial ban), Russia (partial ban), Turkey (complete ban) and Vietnam (partial ban).   

Big Companies Jumping on the Cryptocurrency Wagon

With over 300 million cryptocurrency users around the world, it’s no surprise big companies across industries from -Big tech to Insurance – are joining the revolution by adopting digital currencies like Bitcoin as a payment method. Even modest companies aren’t been left out in the revolution. According to a 2020 study by HSB, a cyber insurance and inspection company, 36% of small and medium businesses accept cryptocurrency payments.

PayPal users in the US can now buy, sell or hold a select few cryptos, including Bitcoin, Ethereum, Bitcoin Cash and Litecoin. They can also pay with any of these aforementioned cryptocurrencies on the Fintech platform. On Amazon, you can buy vouchers with crypto through a cryptocurrency exchange. Tech giant, Microsoft accepts Bitcoin for its Xbox store credit. Credit companies like Visa and Mastercard recently announced deals with cryptocurrency giants Crypto.com and Coinbase. Social microblogging platform, Twitter allows its users to be tipped in Bitcoin.

Other companies that have adopted the use of cryptocurrency as a form of payment include Tesla (they recently stopped accepting bitcoin as a method of payment), Starbucks, AT&T, AXA Insurance, Expedia, KFC, Twitch, Wikipedia, Travala, Dallas Mavericks, Burger King and so much more. Even countries are getting in the groove as well with El Salvador becoming the first country ever to unprecedentedly make Bitcoin the official legal tender.

This level of acceptance by these companies across all industries has shown how cryptocurrency has evolved over the last two decades.   

The Future of Cryptocurrency

With innovative concepts like Metaverse and Web 3.0 set to dominate the cryptocurrency space, the future of cryptocurrency is as bright as the desert sun. The market valuation is expected to double by 2030. 

One of the driving forces for the crypto market at the moment is the exciting virtual collections of digital arts known as Non-Fungible Tokens (NFTs). The NFT market has seen astronomical growth in the past two years as the total value exchange peaked at almost $25 billion at the end of 2021. This growth is now inching closer in value to the traditional art market.

Another driving force is decentralised Finance (Defi) which has disrupted the entire centralised financial system operated by banks, Insurance companies and the government. These financial operations include earning interest, borrowing, lending, buying insurance, trading derivatives, trading assets, and so much more. 

DeFi typically uses smart contracts which are automated enforceable agreements that do not need intermediaries to execute and can be accessed by anyone with an internet connection.

Examples of some of these DeFi projects that have sprung up in the last few years include Aave, Fantom, PancakeSwap, MakerDAO and Compound.

Conclusion

This is the right time for you to take advantage of the innovations happening in the cryptocurrency and blockchain space by adopting some of the solutions that will digitally transform your business in more ways than one.