Fiat currencies have been around for more than a thousand years now. Bitcoin just came ashore a decade ago. Following it, many other cryptocurrencies have come into existence as well. As the masses are being attracted to this new digital form of currency, the question arises among people whether bitcoin is better than fiat currency or not?
Bitcoin is a digital means of currency which is a piece of code either public or private whereas fiat, as we all know is a physical medium of exchange I.e. paper money. The answer to the question, how is bitcoin better? can be derived by every individual easily provided that he/she must be totally familiar with every aspect and perk of bitcoin and with fiat currency. Below are some of the reasons:
Fiat currencies are centralized, which means they are controlled by Government authorities. Bitcoin, on the contrary, is a fully decentralized currency. It is not controlled by any government, so basically it is above the laws and regulations of any government. This decentralization means more security of the investors’ money.
Fiat currencies can be forged at any time the government feels the need to. This has always been a serious disadvantage for all the fiat currencies. As governments produce more money, the overall value of it drops. Bitcoin, as we all know will only have 21 million units. This means its value cannot be affected by the total amount that is circulated along with the globe.
Bitcoin is secured by blockchain technology, which is basically a public record of all the transactions made. It is a complex system that depends on miners to verify a transaction and then add it to the blockchain. The data is continually distributed among several thousand computers, which makes it impregnable.
Low transaction charges
Cryptocurrencies, unlike fiat, have comparatively very low transaction and transfer costs. You can, with ease, transfer more than a hundred million dollars worth of bitcoin at just a several hundred dollar transaction fee. If you compare it to the fee charged by banks, it is more than a 1000 times low, which is stupendous.
It takes about 1-2 days to process and verify any paper money transaction. And at the rate the world is moving, this is a significant barrier for investors. This is where bitcoin again steals the show. A transaction through bitcoin, no matter how large it is, takes about 10 minutes to be verified and then the data related to the transaction is then broadcasted to all users and the blockchain is updated.
These are just a few advantages of bitcoin over fiat currency. It is cheaper, easier to handle and transact, decentralization, it’s very hard nature, and the ability it gives to every individual to handle itself by removing the banking system from in between is what this world needs right now.