Essentially born in response to the 2008 banking sector crash, bitcoin – the first cryptocurrency has only ballooned since then. Till date, of more than 8,000 blockchain-based cryptocurrencies available, bitcoin is the most popular and valuable.
Characteristically, cryptocurrencies are decentralized as they run on a network of computers. This means the currencies based on blockchain cannot be controlled by any one individual. Unlike traditional financial system, transactions with cryptocurrency only involve exchanges and digital wallets. This implies for transactions with cryptocurrency, it is only crypto tokens that exist as digital record of share ownership stored on the blockchain. Elaborately, when two parties exchange cryptocurrencies, the transaction does not culminate until it has been confirmed and added to the blockchain that requires solving complex mathematical equations. The process is called mining, and is the way for new tokens to come into circulation.
Howbeit, despite a slew of prominent differences cryptocurrencies and conventional currencies have few things in common: they both enable easy payments and act as a store of value. On the other hand, cryptos offer features that traditional money system lack or is downright impossible for them to emulate. The first and foremost being, cryptos can be transferred, received, and traded by anyone, anywhere at any time across the world that does not require a bank, government, or third party. With such attributes, several industry experts consider cryptocurrency to be a lucrative digital currency that could revolutionize the entire realm of financial transactions. Hence, with such might that can challenge the long-established robust financial system, the outstanding growth of the cryptocurrency market at a whopping 31.30% CAGR from 2017-2025 is explained.
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Cryptocurrency Market – Key Findings of the Report
Worldwide Popularity of Bitcoin spells Growth
Bitcoin has been the most popular and widely circulated cryptocurrency till date. This is attributed to relevance of bitcoin transactions in terms of security, utility, and asset creation. The counterfeiting of bitcoin is virtually impossible as this would entail confusing all participants in the blockchain network.
However, contrarily, bitcoin miners face the rage of inspection authorities in regions where crypto is banned. Furthermore, bitcoin also faces flak as it eats humongous amount of electricity. This has raised alerts in the energy sector that advocates bans and restrictions on mining of cryptocurrency in several regions. Nonetheless, the growth of cryptocurrency market is predicted at a stellar pace in the coming years.
Outbreak of COVID-19 Mix of Opportunities for Market
With the outbreak of COVID-19, the increasing inclination toward digitalization has led to spurt in growth of the cryptocurrency market. Individual investors, small enterprises, and small-scale industries are increasingly switching to digital money to prevent loss of cash in the event of economic collapse or further crisis in the current situation. Besides this, the decentralized nature of cryptocurrency adds to its security feature.
Nonetheless, risk of volatility that cannot be predicted in the current crisis could hamper the growth of cryptocurrency market.
Cryptocurrency Market – Growth Drivers
- Acceptance of cryptocurrency by several countries as a legal tender is key to the growth of cryptocurrency market. The increasing use of digital ledgers and blockchain technology in the entire financial space, with the spiraling popularity of assets such as bitcoin and ethereum are important aspects that fuel growth.
- Virtues of free of baggage of interest rate, exchange rate, or charges present in traditional financial system brings tremendous growth opportunities.
Cryptocurrency Market – Key Players
- NVIDIA Corporation
- Intel Corporation
- Microsoft Corporation
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