While cryptocurrencies have quickly become a global phenomenon, much of the general public, as well as investors and entrepreneurs, are still very unfamiliar with the topic. However, it is eminently important for one to comprehend the nature of cryptocurrency as it appears to have a substantial effect on global business operations and is clearly proven to be much more than a passing trend.
Essentially, cryptocurrency is a decentralized medium of exchange which utilizes cryptography tactics. In effect, cryptocurrencies differ from other forms of digital payment as they require no intermediary and adopt the “blockchain” system. For instance, Paypal utilizes a centralized digital system to process real currency electronically and hence, link to user’s bank account, whereas with cryptocurrencies, transactions are peer-to-peer based and no “middlemen” are required. As a result, banking fees are avoided and the transfer of funds becomes much easier and quicker. Because there is no government intermediary, cryptocurrencies use what is referred to as the “blockchain” system, to verify and keep a record of transactions. Through this method, every component of the blockchain is continually authenticated with the support of “miners”. Miners use their own computers to process transactions and record them on a public ledger. Subsequently, the miners are rewarded for their work with cryptocurrency of their own. Ultimately, the entire blockchain process allows for cryptocurrencies to be incredibly accurate and secure.
Currently, cryptocurrencies have been adopted by many major players, including Microsoft, Expedia, and Shopify. One can even order a pizza or buy a house using the most notable cryptocurrency, BitCoin. In fact, rather than raising capital through an Initial Public Offering (IPO), many companies have began offering a cryptocurrency equivalent, known as an Initial Coin Offering (ICO).
Thus, it is no question that virtual currencies such as Bitcoin are seeking to revolutionize not only the world of businesses, investors, and entrepreneurs, but our entire global financial system. As people begin to lose faith in third parties like MasterCard, Visa and the like, more and more consumers are attracted to cryptocurrency’s, free and instant decentralized system. Moreover, entrepreneurs and start-ups are able to leverage blockchain technology to improve the current systems financial institutions have in place.
Just recently, RIC Centre hosted our Growing Your Business on “Cryptocurrency” with the City of Brampton. There, Omid Sadeghi, Blockchain Hub Director, taught us about cryptocurrency and blockchain, as well as the technology underlying Bitcoin, Ethereum and more forms of digital currency. Then, Michael Gord, Founder of MLG Blockchain went over the practical side of the industry. He taught us about the uses of cryptocurrency in emerging businesses, and also how to raise money using an ICO. We would like to thank them for their amazing presentations. Moving forward, be sure to connect with us so you don’t miss our next Growing Your Business seminar.