Cryptocurrencies have been equally praised and have fallen victim to criticism many times. It is considered a two-edged sword. Disruptive technology has emerged in the world of finance. In fact, it is an innovation that can bring significant changes to the way by which companies, enterprises, and consumers function. Therefore, it is anticipated that this technology will revolutionize traditional systems and habits, as it provides things that are substantially greater than traditional systems. Some of the examples of disruptive technologies are e-commerce, ride-sharing apps, online news sites, artificial intelligence, VR/AR, IoT, and more.
In the case of cryptocurrencies, they were designed for making payments online and to be free from the control of central authorities. These digital currencies are capable of remodelling the complete business landscape. Trading of Bitcoin and other cryptocurrencies are executed through AI-based trading platforms, which results in increased speed in cryptocurrency trading and earning a good profit.
Many experts believe that cryptocurrencies will be able to disrupt several intermediate platforms like Uber, Amazon, etc. The technology will make it possible for anyone to use a platform like Uber. In the same way, how, the internet disrupted the publishing industry, retail, and video rentals, cryptocurrencies can ruin these destroyers.
It is expected that cryptocurrencies will replace the market business with public ledgers or open platforms that can be accessed by everyone. This will build an interoperable open architecture that can avoid obstacles in accessing the private market. It is likely that cryptocurrencies will shatter education, media, technology, and more. Those companies that will be able to understand the consequences associated with it can become successful.
Now let’s look at the impact of cryptocurrency on financial institutions.
Many people assumed that cryptocurrencies will make financial institutions completely obsolete and they will never have to rely on intermediaries that are controlled by the government to carry out financial transactions. In fact, this expectation came from the advent of distributed ledger technology, however, traditional financial institutions are not just trust brokers. They are capable of performing various other important tasks. For example, they can perform like an observation tool to help governments track lawbreakers and implement laws. Therefore, to be truly destructive, cryptocurrencies will have to launch alterations in management.
There is no assurance that blockchain will be able to make sure that crypto assets are distinct from conventional financial systems or banks. In fact, Blockchain is just a basic technology and not a management system. It cannot avoid conventional organizations that provide management.
Blockchain alone is not sufficient, what is required is ground-breaking control. If you are able to unite cryptocurrency and blockchain technologies with good control mechanisms, then you will be able to achieve more enhanced comprehensive financial control. Through new policies and control mechanisms in place, cryptocurrencies can avoid all the challenges that traditional financial organizations had encountered. Rather than avoiding mediators completely, consider transforming the financial services sector. It is necessary to know how private sector actors and countries will be able to control cryptocurrency.