Finance Assignment: The Effect of Cryptocurrency on Traditional Banking

Finance tasks are crucial for your academics and job aspects. However, the finance task develops financial and analytical skills. In this task, you will explore different finance-related topics and research. In this article, you will learn about digital currency and its impact. How does this digital currency impact the financial services? This topic is the most trending topic in the financial world. You can choose this topic for your finance task. If you want some other topic, seek Assignment Desk. On this platform, you will see various topics in finance.

There are various topics in the finance subject. Some major subjects are banking systems, financial markets and payment tools. To study all these things, you must explore the topic: Cryptocurrency's Impact on Traditional Banking. So, explore all the major financial concepts in this article. Learn about the digital currency and its evolution. Also, see how this currency impacts the services of old banks. So read the complete article to know about this topic. If you find anything complex in this area get help from finance assignment help.

Overview of Cryptocurrency and Traditional Banking

Have you ever listened to anything like Bitcoin and Ethereum? These two words are the name of the digital currencies. There are many digital currencies in the world. These digital currencies are called cryptocurrencies. These currencies are just like shares of the companies. The company shares show the company's valuation. Whereas, these currencies have their values like any other currency. This is the difference that separates it from company shares. Yet, these currencies are only present on the digital platform. So, this increases the power of payments and currencies. This increased power largely affects old banking services. Thus, to understand this impact, learn about digital currency and traditional banking.

What Is Cryptocurrency?

Cryptocurrency is the online currency. This virtual currency has its digital wallet and account. However, all these financial products are only present on the online platform. If you want to use this currency, first buy this currency from another currency. You can buy any digital currency with your traditional bank currency. When you get your digital currency, you can send it or transfer that amount into another currency. This transfer and currency conversion use the cryptography security method.

The Rise of Cryptocurrency

In the history of cryptocurrency, there was only one name "Bitcoin". The bitcoin is the oldest digital coin. This coin was launched in 2008 by Satoshi Nakamoto. This bitcoin first came into knowledge in the white paper. This white paper contains various amazing facts and concepts related to Bitcoin. These concepts generate a new system of payment in the financial world. It introduces the peer-to-peer system and decentralised system. All these innovations increase its popularity and introduce various other digital currencies. At present time there are more than 17000 cryptocurrencies.

What Is Traditional Banking?

All the financial services come under the traditional banking. These services include payment transfers through banks, checks and cash transactions. In other words, it refers to the services provided by the banks. To deal with any finance-related concern, you get help from banks. These banks provide various services like security, interest and loan services. All these types of services count in old banking. But, with the advancement of technology and digital currencies, the usage of these services decreases. The digital currency has introduced online platforms that provide these banking services.

Impact of Cryptocurrency on Traditional Banking

Digital currencies use the online platform for transactions and other services. This digital platform uses a decentralised operating system for all the transactions. It allows you to send the money to anyone. Also, in the transactions, there is no involvement of banks. It is the crucial point in this digital transaction. However, the sender and receiver have their digital wallet. These digital wallets don't have any bank. Many more factors affect old banks. These factors are necessary to know more about the current financial market. Learn all the bellow factors that impact old banking services. Also, research any of these factors to gain deep knowledge. If you want to explore any other topic on finance, use the essay helper service. This service gives you essay-type content on these topics.

Lower Transaction Fees

Most of the traditional banks provide their services by charging a handsome amount. These extra service fees are the major concern of not using their services. Yet, to solve this concern, digital currency platforms provide the services with the least charges. These charges are lower than banks charges. These lower charges are only because of the elimination of the intermediaries. At present, these platforms make direct payments. Moreover, these online platforms make all the payments much faster than old banks.

Financial Inclusion

Cryptocurrency has introduced a new banking system. This system provides financial services easily at very low costs. Yet, this banking system provides all the traditional banking services. Many institutions other than the banking sector can use these platforms to provide banking services. This system generates a new financial entity in the market. These financial inclusions work as an alternative option for all transactions. Yet, most people use these services as they contain the least charges and easy usability.

Decentralization

All digital currencies uses online platform for their transactions. These platforms provide the service of digital wallet to users. However, you can use these wallets for transactions and to store money. There is no involvement of any central body in the middle of the transaction. At present, the banks and government work as the central body in all the transactions. This platform eliminates the involvement of these bodies. It allows users to make peer-to-peer transactions with the help of computer networks.

Innovation

Online digital currency has occupied the banking services. These currency platforms attract all the customers . Yet, these currencies has introduced the digital currency exchange platforms. To use the services of these platforms, a large part of the customer population shifted to these platforms. This customer shifting has become a major problem for traditional banks. Thus, to solve this issue, traditional banks use blockchain technology in their banking system. These banks adopt various new technologies and innovations to improve their services.

Conclusion

To sum up, cryptocurrency is a trending topic in the financial market. However, you can choose this topic for your finance task. You can represent the impacts of online currencies on old banking services. Traditional banking is a major component of the financial market. Thus, it is beneficial to learn about this digital currency and old banking services. Draft these topics in your finance task. Also, represents all the concepts related to the impacts of this digital currency. In addition, access all the updated information on this topic from finance assignment help. Traditional banks are adopting various innovations to compete with digital currency services. So, update your knowledge regularly to know all the new financial services.