Cryptocurrency is a fantastic payment mechanism for many reasons, however WitzOnCrypto understands that without a basic understanding of what it can bring to the table, users may be weary of the technology. After all, we in the cryptocurrency field are entrusting real dollars to a new and emerging technology.

So why are more and more people and businesses using and trusting cryptocurrency?

Reason 1: The incentive system is game-changing.

Traditional currencies have always had a one-sided system where only one entity is allowed to make and modify a specific circulating currency and are primarily responsible for securing this currency as well. In modern society, this is typically a government, however corporations and other organizations have been in charge of a circulating monetary supply in the past.

Instead of a single entity being responsible for securing the currency in terms of forgery and supply, a brilliant blend of mathematics, statistics, and cryptography ensures that literally anybody can accomplish this task. Their work can easily be double-checked for validity and a reward is given in proportion to the amount of work they put in verifying and confirming valid transactions.

Because of this system, participants are rewarded for working for a network and punished for working against it in the form of wasted computing time and electricity. Currency based on blockchain technology has game theory working for it in a way that no other type of currency has before.

To learn more, check the event schedule for Bitcoin 101 classes around Madison.

Reason 2: The inflation rate is controlled by math and not politics.

The US has been fortunate enough to have a relatively stable dollar. In the last 45 years, in fact, during that time-frame the inflation rate has been between 0 and 5 percent with only 1 exception.

WitzOnCrypto recognizes that while our own currency is doing well economically, it is not immune to increased inflation due to bad political or fiscal decisions.

Additionally, if you routinely deal with other governmental currencies, you may have to deal with inflation, potentially on a much more frightening scale. Venezuela is experiencing inflation rates of 20% per week and 16 countries have inflation rates above 10 as of their last available data set%

On the other hand, the cryptocurrency inflation rate is statistically guaranteed to be predictable and the newly created coins (generally) are used to incentivize the security of the network.

If we look at Bitcoin specifically, the current inflation rate is 3.7% and that amount will be cut in half in mid 2020. The current inflation rate is already competitive with most first-world economies and that inflation rate only improves in the future.

Reason 3: Cryptocurrency is international.

While there are admittedly still few places to use cryptocurrency directly or convert it into a local currency, it is currently possible in some locations to do exactly that. The number of locations accepting cryptocurrency is also improving every day.

Dollars, Pounds, Euros, or any other physical cash can be confiscated, but with Cryptocurrency, as long as you have a copy of your wallet files and passwords, you can transport them with little fear of seizure.

In places you can use cryptocurrency directly, you won’t have to worry about fees to convert dollars into another currency or back (although this may still be the case if you need to convert first into the local currency.)

Finally, wiring money has never been easier and less expensive. With traditional money transfer services like Western Union or PayPal, charges of several dollars can be added to send money abroad. With cryptocurrency, you can send money directly to any address, anytime, for a negligible fee. This can be done without ever leaving your home.

Reason 4: Transactions are immutable, inexpensive, and private.

Unlike credit cards, PayPal, or other payment mechanisms that can be charged back and leave the seller out hundreds or thousands of dollars in cases of fraud, once a cryptocurrency payment has been submitted, the seller can be virtually guaranteed that payment will not be undone. This will reduce shrink calculations of nearly every type of business.

WitzOnCrypto takes a utility-based approach towards cryptocurrency. Due to this core value, the cryptocurrencies we most strongly recommend will have a reasonable expectation of maintaining low fees well into the future. Instead of paying wholesale and markup fees to credit card companies, cryptocurrency only requires a flat-rate payment to the network that is usually negligible in comparison. For instance, Visa may charge 2.3% + $0.10 per transaction meaning a $1 transaction will cost $0.12. In comparison, Litecoin and Bitcoin Cash commonly have a transaction fee issued to the buyer for (approximately) $0.003 or $0.0007 respectively. Wide cryptocurrency adoption means not overpaying for payment processing.

Finally, Credit and Debit cards transmit all private information needed to make a payment. This means that fraud is always only a single swipe away. The cryptographic signature process however, gives enough information to make a payment and prove that the owner of that cryptocurrency submitted the payment, but it never gives that person the power to control or attack your account. This signature process will eliminate much of the fraud that does occur on a regular basis.

Reason 5: Cryptocurrency is both a currency and an investment.

PayPal, Visa, and MasterCard are companies that are worth billions of dollars because they are all great at transmitting money from one person in their network to another. Owning or transmitting a dollar on their system however, is by no means an investment in the company.

Imagine instead a payment network that doesn’t transmit US dollars, but instead transmits fractional shares of its own stock. In buying into a specific cryptocurrency’s coin, you’re not only buying into a fantastic new payment mechanism, but you’re also buying into the success of that network itself.

Instead of money sitting in low interest savings accounts of old, users of any magnitude (including the lowest income users) will have benefits similar to that of being able to place money in a stock market with the full liquidity of the network they chose at the same time.

It’s the users of a currency that make the currency itself valuable, isn’t it time for a type of currency that gives back?!