The Trendy World Of Cryptocurrencies…
A silent revolution took place at the New York Stock Exchange (NYSE) in mid-April 2021. Coinbase Global, Inc., known as Coinbase, was listed on the NYSE. The California-based start-up company received a USD 150,000 cash infusion, as it filed for a direct listing to go public with the Securities and Exchange Commission (SEC). As soon as its Initial Public Offering (IPO) hit the market, it was sold like hotcakes. In recent past, only Facebook and Airbnb have tasted such a level of success while launching their IPOs. Coinbase has a lot in common with these two companies… it is called Disruption in modern terminology. In other words, these companies follow the path, which the market has never seen, in order to completely change the character of the market…
Coinbase is one step ahead, as its product is indeed revolutionary… Cryptocurrency! A Cryptocurrency, broadly defined, is currency that takes the form of tokens or coins and exists on a distributed and decentralised ledger. Beyond that, the field of Cryptocurrencies has expanded dramatically since Bitcoin was launched over a decade ago, and the next great digital token may be released soon. Bitcoin continues to lead the pack of Cryptocurrencies in terms of market capitalisation, user base, and popularity. Other virtual currencies, such as Ethereum, are being used to create decentralised financial systems for those without access to traditional financial products. Some altcoins are being endorsed as they have newer features than Bitcoin, such as the ability to handle more transactions per second or use different consensus algorithms, like the Proof of Stake (PoS). This concept states that a person can mine or validate block transactions according to how many coins they hold. It means that the more coins owned by a miner, the more mining power they have.
Cryptocurrency is basically a Digital Currency that has no geographical boundaries and no State Control. One of the main purposes of this Digital Currency is to move the economy beyond the jurisdiction of the State. Meanwhile, Cryptocurrency has already been the subject of various controversies in recent times. Often, it has been used as the black-market currency by drug dealers and arms-traders, and also as a mean of illegal transactions. Naturally, a question raises here: Can there be a material future for this currency even after that? The market, however, has shown confidence in the future of Cryptocurrency at least in the short term, in spite of the inherent danger accompanying the usage of this currency!
Another important issue, in this case, is Ethics! An Economy in which there is little or no State Control can be characteristically termed as one that is Anarchist. And, the relationship of Anarchy with a healthy Global System is not straight. Arguably, the most dangerous aspect of Cryptocurrency is the structural lack of clear information about it. Hence, uncertainty is an integral part of this currency. On the other hand, this currency is completely computer-dependent, or heavily server-dependent due to its mobility. This monetary system requires a huge amount of electricity for proper functioning. As a result, its impact on the Environment is also detrimental, in a way! So, the ethical aspect of using this currency is multi-layered.
Unfortunately, the market does not seem to be worried at all about the ethical aspects of the Cryptocurrency. The only motto of the market is to generate Profit, and not to think about Ethics. If Cryptocurrency loses its profitability, then it will not take long for the market to abandon the currency. One can readily recall what happened with Dot Com Bubble at the beginning of the 21st Century.
So, here lies the responsibility of the State. It is the duty of a State to decide how to use a product by taking proper care of the Ethical issues. The State can impose a ban on the use of Cryptocurrency, thus, encouraging the black-marketeers. The State can also bring this currency into the mainstream trade, prompting the product to follow the established rules of the market. The State has to make a choice, soon.
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