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Cryptocurrency has been a hot topic the past few years and many says that it will be the currency used in the future as it is not like fiat currency, a government-issued currency that isn’t backed by a commodity such as gold. Fiat money gives central banks greater control over the economy because they can control how much money is printed. Take for example the US dollar where the US Federal Reserve has been printing money to counter the effects of Covid-19.

This has raised concern on whether the value of the US dollar will drop because more money is printed. I didn’t really study any finance modules in school as I studied social sciences but having a currency issued by the government and regulated by the central banks means that the value of it is really based on the country’s economy and how the government is doing. On the other hand, a cryptocurrency is a form of digital or virtual currency that can work as a medium of exchange. Being virtual in nature, they use cryptography technology to process, secure and verify transactions.

Unlike Fiat currencies, cryptocurrencies are not controlled by any central authority such as a central bank. Instead, they are limited entries in a database such as a blockchain that no one can change or manipulate, unless certain conditions are met.


*Information published here are purely opinions or feedback and should in no way be taken as guaranteed. Viewers are encouraged to do their due diligence by doing sufficient research before making any decisions based on materials provided.