COVID-19: An Accelerator to Adopt Blockchain and Cryptocurrencies

blockchain - cfamedia

Recently, many more savers have, gradually, been turning to a world of “decentralized finance”, as the next generation of digital banks, maybe the next big thing.

Pre-COVID-19, the world was, already plunging into a huge global debt crisis and from indications, this development could lead to another world financial crisis.

This debt burden is becoming bigger, as governments and central banks of various countries are ensuring that, they support their economies devastated, by the COVID-19 pandemic.

These efforts, however, may have to get stepped up, as the effects of the COVID-19, is brewing up another, likely, great depression, as unemployment cases have risen.

It is commendable that, the government and central banks, are putting in their best efforts, to cushion the effects of the pandemic.

One cannot, however, shy away, from the huge fiscal and monetary response to the pandemic that is pushing people, to consider other financial alternatives in gold and bitcoin.

Since the commencement of the month of April 2020, the price of bitcoin has seen a steady increase, of over 30%, after doubling in value, over the past year.

As loopholes are explored, in the traditional banking system, more effort has been made, to ensure the efficiency of a decentralized network, in these uncertain times the world is experiencing.

If the growing use of cryptocurrencies, like bitcoin is to stand its ground, then, the world’s financial system is to be taken, as big as, the internet.

With some countries central banks, cutting off interest rates, to a near-zero value, it has been quite difficult, to earn reasonable interest on bank deposits.

However, more bank savings, are now turning to the side of a decentralized finance system, (interest earning platforms).

These platforms, offer up to 6% annual savings rates, or more, on deposits made through cryptocurrency.

A good number of non-currency use, of blockchain technology may, also, enjoy some considerable lift, in the light of this pandemic.

Electronic voting, digital identity and food supply tracking, are just part of the potential benefits, obtainable from the application of blockchain to combat COVID-19.

China is taking crucial steps, in leveraging blockchain technology, as it may soon launch the next generation of central bank digital currencies.

The sooner digital currency gets accepted, by the central banks of many countries, the better it would be, for their governments, as they would enjoy the following:

  • Reduction in the cost of payment delivery
  • Easy access by individuals, with no bank accounts
  • Ensure payments to those, who lack a physical mailing address
  • Reduce the transmission of the virus, as no debit cards are involved
  • Digital payments ensure easy tracking

With the coming of this pandemic, we expect that we are, already, in a historic shift that would change the outlook of the world.

Thus, accelerate the adoption, of a transparent digital payment system, backed by blockchain.

Featured Image: peerbits

Don’t miss important articles during the week. Subscribe to cfamedia weekly digest for updates.