If the mention of “FIAT” conjures up images of speedy Italian cars, you’re not alone! However, today we’re discussing the alternate definition of “fiat”: any currency that a government has declared to be legal tender and is not backed by any physical commodity (e.g. USD, Euro, etc.). The value of fiat comes from the relationship between supply & demand, not the value of the material the money is made of.
In financially uncertain times, it may seem like a good idea to hide away your money under a mattress; unfortunately, with every second that fiat spends under your mattress, its value is reduced. This is also known as inflation and has everything to do with the fact that a country can print more money anytime. For example, every year, USA prints one trillion new dollars!
With cryptocurrency, it’s all about deflation. Since it has a fixed supply, its value can only go up, regardless of whether you keep it safe and sound in your wallet or use it to buy that Italian sportscar!
Ever think about where your money comes from? Most of us buy and sell things without thinking twice. But consider this: would you pay for something if you knew the money was being given to a criminal? Would you take money if it was stolen from someone else?
With crypto, every coin/token comes with a built-in tracking device. It’s simple to check where it has been from day one of its existence. Your conscience can rest clear.
Money transfer speed has come a long way from its inception: most successful transactions are enacted within 1 to 3 business days. Impressive, right? But we can do better. Thankfully, cryptocurrency has developed a lot since 2009; for some altcoins, the transfer speed can be the matter of seconds.
How many times have you sent someone 100 EUR and had them actually receive all 100 EUR? Banks live off fees, including transfer fees, so it is likely that your friend only received 90 EUR in the end.
These fees are much lower for most crypto coins/tokens; for example, the receiving party will likely receive 99.9 tokens out of 100. You know what they say: “More is more.”
The term "underbanked" is a sad truth: many people do not have bank access or do not qualify for it. In contrast, with crypto you’re your own banker so long as you have an internet connection. Opening the account, sending and receiving…all these important tasks can be handled on your own. In short, everyone can buy or sell cryptocurrency.
Can you think of more ways crypto beats fiat? Leave us a comment and chat with us on Telegram!