Every day, new companies are starting to accept blockchain-based cryptocurrencies, like Ethereum or Bitcoin, as payment for their merchandise. Yet some pundits remain skeptical if cryptocurrencies will ever garner a mainstream appeal because of the complicated math that takes place under the hood.
This is a misguided question! You can use and spend cryptocurrency technologies without having involve yourself with the mining process. Common fiat currencies have no technical difference. Often believed (incorrectly) to be based strictly on gold reserves, the US Dollar trades against other currencies like the Euro or the Pound due to complex market forces. Compared to blockchain, there is no difference in technicality beyond public gossip.
So how do you trade blockchain currencies? The first step is to sign-up at a popular exchange or download one of the many blockchain enabled apps. Exchanges like Gemini or Coinbase allow you to purchase cryptocurrencies from US Dollar, and places like CEX are great for users based in Europe who have cash stored in Euros or Pounds. Once you purchase cryptocurrencies, you can buy and sell them on the whole network, and easily transfer currency from one exchange wallet to another.
Some applications, like Dether, are exchanges that act as bank accounts as well. At cryptocurrency compliant brick and mortar stores, you can use Dether to make purchases for common, physical items using Ether - the coin for the common cryptocurrency network Ethereum. You can also pay other Dether users in Ether for goods and services, creating PayPal-like services right off the bat.
Slowly but steadily, as more and more firms adopt blockchain, Bitcoin and Ethereum will become more common methods of purchase. Looking at Google’s trends on the search of terms like Blockchain, the interest has been steadily rising by the general public. The price of Bitcoin and Ethereum reflect the same trend. In the last year, hundreds of companies are starting to raise funds through ICO’s (initial coin offerings) which utilize blockchain as a form of payment / investment.
The use of them by some users will encourage more stores to accept them as a form of payment to avoid segmenting their customer base, and that in return will encourage more people to explore cryptocurrencies as a popular payment option. Cryptocurrencies hence have an unique compounding function of growth - the more users using them not only stabilizes the currency but encourages people to purchase them increasing its value. But why is this an optimal currency option compared to common fiat currencies like the US Dollar? The answer relies on how the premise behind cryptocurrencies is a much more futuristic stance on money.
The best part about cryptocurrencies is the universal nature of them. Whilst paying someone in another country could sometimes involve expensive money transfers, cryptocurrencies are based on a network protocol that is global in scale. Amazingly, a Dether user in America could pay a Dether user in Thailand with a press of a button, without being challenged with regulatory and financial roadblocks / costs along the way.
The volatility of the price of Ethereum and Bitcoin has concerned certain users, but that concern is only valid in the short term. More and more companies are using Bitcoin for payments, including Subway, Microsoft, and Expedia, and with its growing public acceptance, its value will only increase. Hence, basing your capital in cryptocurrency could not only be a convenient way to purchase items but also be a strong investment for the future. The major crashes of Bitcoin in the last few years have been due to potentially strong cryptocurrencies emerging primarily. However, each time, the currency rebounds quickly and effectively, paving the way for a trustworthy medium of payment.
The price of Bitcoin and Ethereum will eventually stabilize, and once it is publicly popular and - ideally - the main payment option for most vendors, it will not subject users to the politics of currency. While political shocks like Brexit could cause a major decline in the purchasing power of a coin, Bitcoin and Ethereum are based on mathematical algorithms and are not tied to a single country’s politics. Hence, they provide a better long-term robust architecture.
Further, applications like Dether allow users to have bank accounts, make withdrawals and payments without requiring a local branch infrastructure available. Since it requires a simple app download, it is easy to use on the go and requires no complicated technology to operate.
Over time, blockchain will grow more and more popular. Even if you are not ready to make the full leap, it may be a great idea to purchase a little bit of Bitcoin (could be as little as $20 worth) and use it at a store or for an online purchase. In a decade, who knows: maybe kids would even get allowances in cryptocurrencies!