Centralized and Decentralized Exchanges – Which One To Choose?

Cryptocurrency has brought power back into the hands of individuals. With the possibility of eliminating the third-party involvement in transactions, the digital currency has made palpable growth since its introduction in 2009. As a currency which is almost impossible to duplicate, it holds enormous value in this digital age.

There are more than 200 cryptocurrency exchanges to trade on. Based on their type of operation, we can classify them into centralized or decentralized. While there are so many things to understand in the blockchain, it’s also important to grasp the concept of centralization versus decentralization. So, what exactly is a centralized or decentralized exchange?

What is a Centralized Exchange?

Let’s put it this way, centralized means that there’s a single point which does all the work involved in any given operation. Take Google, their platform needs all the data to enter and leave through a central hub. Which means you can’t send or receive any information without it going through a single point.

That is how a Centralized exchange work. The platform offers an efficient trading environment at the cost of user’s privacy and personal information. The cryptocurrency data gets transferred through a network including passwords and get stored on a centralized server. These pieces of information are sometimes shared with the government due to regulations.

This doesn’t go well with the very concept of cryptocurrency which demands complete anonymity and safety. Also, these kinds of exchanges are vulnerable to attacks, bans, and lack of privacy. Otherwise, you can compare these type of business models to the traditional securities exchanges or even banks.

What Makes Centralized Exchanges More Popular?

Although they are vulnerable up to a certain extent, they helped to bring cryptocurrency into the masses. It has also been essential in the formation of crypto markets that we see today. Here are some benefits of using centralized exchanges or otherwise known as CEX.

The ease of access

CEX makes it easier for users to create an account or buy their first cryptocurrency. This helped to bring new users into the system and has also made crypto markets more popular.

They have a license

Most of these centralized exchanges have licenses and runs under government regulations. This gives the trader an assurance if something goes wrong.

Use of escrow

As a middleman in trades, they hold the currency until both parties complete their end of the bargain. Thus, there’s no need to worry about the transaction after the trade gets finalized.

Transparency

They make their address and location available to the traders. Hence, it helps the consumers to reach them if needed.

Offers and discounts

CEX also offer discounts while trading in large amounts. Also, the users can exchange fiat currencies to crypto and cryptocurrencies to fiat.

How Decentralized Exchanges Benefit Traders?

Decentralization is a type of network that isn’t operated by a central party. In other words, unlike their counterparts, their platform doesn’t need all the information to go through a single point. Instead, it’s more like a peer-to-peer network where many points connect.

This means, instead of one party being responsible for all the data and information, decentralized platforms operate on a peer-to-peer basis. By operating this way, consumers personal information are not shared as a third party has no access to the information.

These exchanges offer privacy and control over the assets by taking power away from market makers and leaders like banks, lawyers, and brokers. They also operate with the help of smart contracts.  Though there are plenty of decentralized exchanges out there, they have always struggled to rival the centralized exchanges. This is due to the technical difficulties making decentralization more accessible.

When a transaction initiates on DEX (decentralized exchange), the transaction data processed on different hard drives must get verified to achieve a secure result. This multiplies the difficulty required to complete a transaction on DEX.

The shared blockchain network remains to be the core issue in improving decentralization. We should also notice that it has been the biggest technical difficulty since the introduction of cryptocurrencies. But, the introduction of smart contracts and distributed apps can make the difference for decentralized exchanges as it offers more functionality.

Benefits Of Using Decentralized Exchanges

Privacy

Transactions made on DEX shares no data with the third party. Hence, it allows maintaining consumers information and privacy. Also, centralized exchanges ask for personal information such as email, identity proof, and phone number while signing up. DEX doesn’t need any of that.

Security

The biggest advantage of decentralization is the enhanced security it offers. The cryptocurrency got introduced for this purpose, it gives the consumer complete control over their assets.

Decentralized servers

Most DEXs do not have a centralized server, they store data across various servers around the world. Hence, the data remains safe and is almost impossible to get hacked.


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Blockchain Companies Using Decentralized Exchange Models

Decentralization is promising a system liberated from banks, laws, and third parties. Thus, the system has the potential to bolster its growth in the next few years. Here’s a list of companies trying to solve their inefficiencies by making use of the blockchain technology. Particularly the future is promising for decentralized exchanges because they are destined to improve and innovate if they want to save the cryosphere.

Waves Dex, CryptoBridge Dex, OasisDex, Bisq (aka BitSquare), Stellar Dex are one of them but there are much more decentralized exchanges out of which few are still being built and few are facing security difficulties or still have very low liquidity.

Companies spend millions on improving decentralized apps. Yet, they are still slow, hard to use, and sometimes very expensive for consumers. Menlo One has found a solution to solve these concerns for users. They provide a reliable framework for making decentralized apps by using a reputed algorithm for enhanced performance. They are as fast as traditional web apps and offer the security of blockchain technology.

Implementing and applying the decentralized technology of the Blockchain cryptocurrency network in the alternative assets as wine industry, invests in it its future and ensures its longevity. Modern trading platforms make fine wine trading easier and more reliable than ever before. Backed up by its partner, DotChain GmbH based in Switzerland, one of such platforms, CWEX, guarantees anonymity and security of investment by providing blockchain based ownership certification to each bottle of wine traded on the trading platform. Fine wine vendors that passed a strict auditing process can list their products for trading in CWEX/EOS/BTC/ETH/NEO/USD.

Founded by Zhang Jian, FCoin is also a fully decentralized exchange with a massive volume of trades happening each day. Centralized exchanges have been ruling the crypto markets since the very beginning. However, a start-up based in China has made the headlines with its fully transparent crypto exchange.

Conclusion

To sum it up, decentralization is the core reason behind the creation of cryptocurrency. Though the centralized exchanges are benefiting the investors and the system, the true purpose of cryptocurrency will only come true with a decentralized cryptocurrency exchange.

It’s up to the individual to choose the right exchange for themselves. Centralized exchange provides the ease of access and reliability while decentralized exchange contributes to the enhanced privacy. Both has its own benefits and concerns, for now, they serve to bring crypto markets into the broad frame.

How Mass Media Drives Your Decisions When It Comes To Cryptocurrency Investing

Contrary to popular belief, social media is not only a “young person’s game”. A Cogent Research paper indicates that about 90 % of investor groups in the high net worth bracket use social media sources to take crypto investment decisions. 70 % of them have changed relationships or have relocated investments elsewhere.

This sounds like a very good opportunity, which many crypto investments-related businesses seem to forget. It’s unfortunate since social media allows companies to directly access their communities and give important information. Currently, there are various companies that delegate this work to other entities, such as crypto brokers or blockchain advisors, to share their stories for them. However, they have limited control over how their stories and updates are shared through various layers. This, in turn, increases the risk of dropping out information or distorting it, thus, a direct relationship with the community is essential to avoid such situations, especially when operating in the crypto niche.

Understanding the basics of Bitcoin Price influencing

The desire to keep and multiply one’s capital is the main driving point behind any investor’s decision to buy Bitcoin, or cryptocurrencies in general. This is quite achievable provided you know the ins and outs of analyzing and predicting what moves the prices back up. It also depends on how fast the trader reacts to the changes in the market situation and takes an appropriate decision within the required time.

There is quite a bit of similarity when it comes to the laws and dynamics that govern both the Stock market as well as the cryptocurrency market. The rate of Bitcoin and other cryptocurrencies are dependent on the changing demand in the market as well as the offers on it.

The Definition of Cycle FOMO-FUD

At the time of writing, the total consolidated market capitalization in the cryptocurrency market exceeded the $800 Billion mark. Because the cryptocurrency market is not regulated at the same level of stock markets, and no proper ethical standards are established, a certain atmosphere of impunity and permissiveness persists in the market. The FOMO-FUD cycle thus has become an important tool in the cryptocurrency market. We shall now explain the key terms in brief below.

  • FUD: “Fear, Uncertainty, And Doubt”: It refers to a deliberately created situation when some unconfirmed news or circulating rumors have a profound impact on a particular cryptocurrency’s value and its exchange rate. This is obviously beneficial to only a narrow segment of crypto traders. Thus, FUD can be described as a tactical information impact, directed mainly at stimulating a feeling of panic or doom into the market. This, in turn, leads to massive volumes of sell-offs, more commonly referred to as “disposal of assets”.
  • FOMO: “Fear of Missing opportunity”: This concept is borrowed heavily from the psychology, “Fear of missing opportunity”. Most individuals who face this phenomenon are usually newcomers and novice traders.

How Does This Affect The Psychology Of Purchase?

It is not common to find an individual affected by the psychology of the purchase, especially in times when the exchange rate and the agiotage attached are growing. As a trader, your subconscious can paint bright prospects in case of a constant increase. This can influence your brain into taking decisions based on the sense of fear of losing out on a profit rather than basing it on logic and analysis. Such decisions are a common problem for novice traders, with most people losing significant money by making a wrong decision at the wrong time.

This psychology almost follows a cycle of a series of deliberate actions, aimed primarily at altering and forming the necessary opinion of the audience. In other words, this is a psychological manipulation, done by working with information fields to create the necessary dynamics.

“During this cycle, FOMO and FUD distributors are engaged in a psychological and information war as they compete for the attention of a curious investor who is inherently vulnerable because he is always in search of deep opinions that could contribute to the best decision to invest funds. It’s a bit ironic that in the crypto world, the opinions of others can do more harm than help” – Doctor of Philosophy and Cognitive Neurobiology, Bobby Azaryan, on how a natural cycle of fear and greed is used to promote specific interests.

This psychology, however, is not restricted at providing competition for investors and their resources. It can also be used to harm or malign a rival project. This is driven by the single motive of not allowing any other token to exceed in value over their own token, allowing them to attain a higher place in Coinmarketcap.

Influence of the Mass Media on the Bitcoin Rate

Apart from the classical influence scheme, large players have the power to increase the demand of any cryptocurrency by purchasing it in large volumes, raising the rate and creating the illusion of stable growth. They begin to dump their assets as soon as their trades peak, so that the rates may go down to the minimum values.

Another influence mechanism refers to creating artificially inflated popularity and ego around the desired token. Thus many present media houses push to publish the “hottest” news on a regular basis about the cryptocurrency they are promoting.

In Conclusion

According to this study, interesting differences at the social influence level are revealed after studying the dynamic relationships between social media and Bitcoin returns. The numbers of bullish and bearish tweets by all users have negligible effects on bitcoin returns in the next hour. However, if the sample to tweets from those users with the most followers is limited, the relationship becomes much less significant. This suggests that follow-the-influencer behavior exists in the bitcoin market.

On the contrary, posts from the silent, but salient majorities have a stronger association with future Bitcoin returns as compared to posts from the most active Internet forum contributors. Therefore, Investors should analyze empirical data and carefully select the most influential people in a social network to collect information.

Speculative vs. Regular Cryptocurrency Trading

The cryptocurrency market might be stuck in a seemingly endless bear market, but that doesn’t mean that the interest in trading cryptocurrencies has disappeared. In fact, there are still thousands of traders trying to make the best of the current market conditions.

What many of these investors have realized is that regular investments might not be the best option in a market that seems unable to find support. So let us take a look at some of your options.

Regular Cryptocurrency Trading

When we talk about regular cryptocurrency trading, we are referring to the buying and selling of digital currencies from an exchange or a wallet. This is the “traditional” way of trading cryptocurrencies, and it’s a great way to benefit from a rallying market or a falling one. It’s also the best method for long-term investments.

When you buy a cryptocurrency from an exchange such as Binance, those assets belong to you. That means you can spend them as actual currencies or hold on to them until you feel like selling them for a profit. The same goes for cryptocurrency wallets and other services that sell cryptocurrencies in their actual form.

The only downside to this type of trading is that it requires the assets to increase in price for you to make a profit and for the past few months that hasn’t been the case.

There are a few exchanges that allow you to short trade assets and even use margins, but generally speaking, you won’t make a profit unless the asset you bought increases in value.

Speculative Cryptocurrency Trading

Speculative cryptocurrency trading is trading with derivatives based on underlying assets. That means you don’t buy the actual token or coin but instead you speculate on its price.

There are several ways one can buy cryptocurrency derivatives. For example, in 2017, the first ever Bitcoin futures was launched, and now you can buy similar products on a handful of cryptocurrencies including Ethereum, XRP, and Litecoin.

Another popular derivative is ETFs which aren’t available for cryptocurrencies yet – the SEC is currently evaluating several ETF applications, and they might become a reality soon.

With that being said, both futures and ETFs are designed mostly in the same way as regular trading and investors expect to make money from increasing prices.

Enter CFD trading, a speculative investment opportunity that can easily be used for increasing as well as decreasing prices. A CFD is a derivative that mirrors the price of an underlying cryptocurrency. They are usually only open for a few minutes to hours and are always traded with leverage which increases your potential profits.

The best part about CFDs is that you can make a lot of profit from falling prices very easily.

If you want to start trading CFDs, you need to first find a regulated and safe broker to use. When it comes to cryptocurrencies, their fluctuating nature creates perfect conditions for day trading, especially for CFDs. In 2017, eToro launched cryptocurrencies as CFDs which then led to them launching an exchange function a few months later according to review of eToro. In the same year IQ Option and few currently major players on the market decided to join in on the hype as well. Regarding IQ Option, it offers cryptocurrency CFDs as well as actual assets, meaning you can invest in two different ways with the broker.

What Type of Cryptocurrency Trading is the Best?

That’s a very good question, and ultimately the decision is up to you. However, in order to benefit from as many opportunities as possible, you should combine different types of trading.

For example, when the market turns bullish again, you can buy a set of assets from an exchange and maybe even invest in some futures. Then you’ll hold on to these investments until you think it’s time to sell and pocket your profits.

At the same time, you can use CFDs to day trade on price swings and make regular profits on a daily or weekly basis. And when the market turns, you can short the prices and keep making a profit.

It’s a win-win situation when combining different trading styles and instruments.

Final Words

Most professionals would agree that cryptocurrency investments on exchanges and with wallets are the safest option, although not necessarily the most lucrative. And let’s not forget that cryptocurrency exchanges aren’t regulated meaning your funds might be lost and the exchange can turn against you since you have no support.

Derivatives trading, on the other hand, is a little more risky in terms of potential losses. However, that risk is compensated for by the potential profits as well as the fact that the services offering futures and CFDs are all regulated and operated under strict requirements.

As mentioned, it’s up to you to decide how you prefer to trade your cryptocurrencies, but it’s advisable to look into all of your options before you get started.

Effective Tips for Creating a Killer Cryptocurrency Portfolio

Cryptocurrency investments are worthwhile. In fact, some people are now billionaires because they invested in virtual money and the systems that support it. Some of them include Chris Larsen, Changpeng Zhao, Joseph Lubin, and Winklevoss Twins, and they worth $8 billion, $2 billion, $1.5 billion, and $1.1 billion respectively.

Their success stories have encouraged many people to invest in cryptocurrencies. Some of these people have failed while others have succeeded. Failures arose out of flawed analyses. For example, people make mistakes when it comes to analyzing market capitalization, diversification portfolios, product development, and investment patterns. Another problem is following the market hype instead of market dynamics. Various reasons for success exist as well. In fact, here are practical tips for creating an incredible cryptocurrency portfolio.

  1. The Supply of the Coin Matters

The supply of a cryptocurrency refers to the number of coins that are present in the market. Examining this quantity helps you determine if there is an adequate supply of the digital currency. Remember, the relative unavailability of the coin relative to the demand for it means the price for each coin will increase. The reverse happens when an oversupply of the digital currency exists relative to people who want it.

Coins Added to the Market

New coins entering the market affect the supply of virtual currency as well. For instance, there will be an oversupply of the coin if additional coins come into the market at a high rate. A drop in the price of the cryptocurrency results from this oversupply. The reverse scenario occurs when new coins enter the market at a low rate. More specifically, the cost of the cryptocurrency will drop.

Investment Decision

Therefore, a prudent investor scrutinizes the supply of the coin and the rate at which new coins are entering the market. Avoid it if there is an oversupply of the digital currency relative to its demand. Give it a wide berth as well, if new coins are entering the market at a high rate.

  1. Diversification Based on Market Capitalization and Target Market

Market Capitalization refers to the total value of a cryptocurrency. Multiplying the number of coins a cryptocurrency has in circulation by the market price of the currency gives you this value. Prudent investors divide cryptocurrencies into high, medium, and low market capitalization categories. Then they invest 50%, 30%, and 20% of their investment money into these categories respectively.

Target Market

Unlike fiat currencies that seek to address any issue, some cryptocurrencies focus on specific needs. For example, some are specific to publishing, lending, and storage. Others include micropayments, advertising, social media, and computing. Unfortunately, many cryptocurrency investors focus on one digital currency addressing one issue in a particular market.

Investment Decision

The top 30 cryptocurrencies are high market capitalization currencies. The 150 digital currencies that follow them are medium capitalization, and any cryptocurrency after that is a low capitalization one Invest 50% in a few of the top 30, 30% in some of the next 150, and only 20% in low category currencies. Diversify your portfolio according to the target market of the coin as well

  1. Analyze Investors and Funding

An ICO may be worthwhile if renowned venture capital firms are investing in it. Remember, these firms have an adequate number of researchers. Therefore, spending your money on a particular ICO means that they have evaluated it thoroughly. More importantly, they have determined that it is a sensible investment.

The Funding

A cryptocurrency whose ICO suffered from inadequate funding is likely to experience massive failure in the future. Avoiding it is an excellent idea as is selling it if you already bought it. Examine the team as well. Remember, an ICO takes time, effort, and a lot of skill. A small staff is an indication of limited funding. In fact, it is likely that some members of the team are developing the code free.

Investment Decision

According to the leadest affiliate crypto platform Stepium, investors should avoid highly valued currencies that have a small team. Similarly, avoid a lowly valued cryptocurrency that has a large staff behind it. Moreover, go for digital currencies that have highly respectable firms investing in them as well.

  1. Look at Product Development and Activity

Product Development

Products are as good as the effort the developers put into them. The same case applies to cryptocurrencies. They are as good as the people behind it. Look at the cryptocurrencies public code repositories to determine the worth of the individuals who are pushing it. Examine the organization of these repositories and the number of contributors who had pushed commits to them.

Level of Activity

The level of activity behind a cryptocurrency tells you whether it will withstand emerging challenges in the industry. Determining their level of activity is possible by looking at public code depositories to see how often they commit code. You can scrutinize their social media as well watch out for details such as appearances in technical conferences or discussions.

Investment Decision

Go for cryptocurrencies that have committed developers behind them. Uninvolved developers could be an indication of a coin that is failing or might fail sometime soon. Moreover, the developers might be inexperienced or inadequately knowledgeable if their level of activity in the industry is low.

  1. The Marketing and the Future

Peter Drucker, an organizational management guru, once said that marketing and innovation are the only two things that help businesses grow. The same principle applies in the cryptocurrency market, i.e., effective marketing leads to the growth of the digital currency and vice versa. Examine the marketing campaign across various platforms including social media and cryptocurrency forums.

The Future Cryptocurrencies are facing multiple challenges including government regulation, hacking attempts, and common misconceptions. Overcoming these challenges is difficult. Fortunately, developers can prevail over them if they have a viable plan to do so. Examine the strategies that the cryptocurrency developers have when it comes to overcoming these hurdles. Are they feasible?

Invest in a cryptocurrency after you determine that the people behind it have a plan to market it. A strategy for overcoming challenges that it might face is necessary as well.

5 Tips to Consider Before Integrating Cryptocurrencies in Your Business

Even though the cryptocurrency market has more or less plummeted since the end of 2017, the interest for these digital currencies is still high. During 2018 the focus in cryptocurrencies has slowly started shifting from mostly being an investment opportunity for private investors to something businesses are becoming more interested in.

Now, whether you have an interest in investing in cryptocurrencies using your company or you want to start using them and blockchain technology as a part of your business, there are a few things you need to be aware of. Before you start investing in cryptocurrencies with your business you need to consider the following.

Knowledge is everything

This might sound obvious, but you really must educate yourself before you get started. Most people have a vague idea of what cryptocurrencies and blockchain technology are, but a vague idea is not enough. In fact, most major losses and issues regarding cryptocurrency investments could have been avoided with some basic education. This is a completely new market and just because you know about stock or forex trading doesn’t mean you understand cryptocurrencies.

Also, learning more about cryptocurrencies will help you determine how you can best approach the market as a business solution. Do you want to handle cryptocurrencies as an investment or would you benefit from using Bitcoin as a means of payment? Maybe you want to run an ICO to create a new asset while funding your next development.

Are your customers interested in cryptocurrencies?

This is a question you need to ask yourself before you continue and you need to make sure that you’re right about the answer.

Over the past few years, we have seen that businesses that integrate cryptocurrencies experience one of two things. If their customers are okay with the idea of using or being associated with cryptocurrencies, the business gets a competitive edge which can be extremely important. There are several examples of businesses becoming industry leaders for being early adopters of cryptocurrency solutions.

On the other hand, a cryptocurrency integration has the potential to hurt a business if the customers are not interested in using digital currencies. Also, cryptocurrencies and blockchains are not a necessity for most businesses, and if it won’t help you solve a problem, you should consider holding off on the integration.

The lack of a middleman can mean two things

One of the main selling points of cryptocurrencies and the foundation that Bitcoin is based on is decentralization. Most cryptocurrencies, with a few exceptions, are decentralized to a certain extent, and that alone creates unique possibilities.

The lack of governing bodies and the exclusion of banks has created a marketplace with very little to no regulation. Little regulation can be good since you can avoid all middlemen and the extra fees and charges that come with that. However, it also creates increased risks and leaves you more vulnerable to problems, which brings us to our next advice.

Be aware of market manipulation and volatility

The cryptocurrency market is known to be highly volatile which creates problematic situations for businesses, especially those that use cryptocurrencies for payments. It’s hard to use a currency that’s constantly changing in value. Also, if you make a profit from a cryptocurrency investment, that profit could be gone overnight which could seriously hurt your company. Although, there is a more concerning issue with the market’s volatility.

Recently, a comprehensive study was published with proof showing that much of last year’s record-breaking prices were created by market manipulation. Not only does that mean that much of the fluctuations were controlled and planned, but it also means that it could take very long before we reach the same prices as we saw last year again.

Market manipulation is a major concern, and you might want to consider waiting to enter the market until the situation has been dealt with accordingly. Then again, you could also benefit from volatility by going both long and short with your investments and for that CFD trading is perfect. Also, there are several options of regulated brokers that offers cryptocurrencies. Using a regulated broker in an unregulated market provides a lot of safety.

You will risk losing it all

We’ve already touched on this subject, but it doesn’t hurt to bring it up again to summarize our advice.

There are some really great benefits of using cryptocurrencies, both as a private person and as a business. As mentioned, cryptocurrencies such as Bitcoin can help take your company to the next level, and it can give you an edge over your competitors. By you using it and encouraging others to do the same, you will help drive the technology forward and at the same time increase awareness for something that will most likely be an important role in the future of our society.

All that being said, there is always a risk that you’ll lose everything you invest, especially at this point in the development. No one really knows where the market is going and even though most agree that the technology won’t disappear, certain assets might. For example, most ICOs that have ever been launched are either losing money or have disappeared completely.

The market is still young, and both the potential reward and the risk is high, so be careful.

Asia: Taking Over the World Economy with Blockchain

“Blockchain” – a term heard frequently nowadays amongst trading circles and tech enthusiasts alike have started coming into the public eye, especially in 2018. Nearly 20% of all cryptocurrency trading volume comes from South Korea and other nations in the region. This 20 % comprises of big institutional investors and average Korean citizen alike. Most go to exchanges like BitThumb, Korbit, or Coinone. It is largely believed that the success of Blockchain technology will usher in a new system in terms of real-estate, banking, healthcare, governance and the list goes on.

ASIA: The Blockchain Hub of The World

Cryptocurrencies, in general, have always had a cult following from Asia, especially in countries like Japan, China, and South Korea etc. Some of the world’s largest cryptocurrency exchanges are originally based in Asia. The rising individual wealth in Asia, particularly in China and South Korea is also driving the performance of cryptocurrencies. These individual investors are looking for alternative investment platforms that provide higher returns that are not usually found in traditional vehicles, such as stocks, bonds, and real estate. A perfect example would be Binance, consistently being the top cryptocurrency exchange in the world by both daily trading volume and revenue. Another honorable mention would be Bitfinex, a Hong Kong-based exchange offering many crypto assets. While National Governments in the region have always had a mixed stance towards cryptocurrency trading, Blockchain, on the other hand, has attracted a special interest from many industries in Asia. Hence, Asia is considered the Blockchain hub of the world, due to a variety of factors mentioned in brief below.

  1. Asian Consumers Are Ahead: There’s no denying that the popularity of cryptocurrencies has exploded all over the globe. However, if statistics are to be believed, cryptocurrency trading platforms are gaining popularity at a much faster rate in Asia compared to the rest of the world. It is estimated that one of three South Koreans owns or have transacted using some form of cryptocurrency. There are concrete reasons behind why Asia leads the race in this regard. Firstly there are many regions in Asia who have directly embraced digital currencies as opposed to using credit cards.

By 2020, about 1 million people in Asia will receive their very first loans ever. Crypto economy is the tool that will help them to merge into financial markets and to apply for approximately 3 million payday loans annually. Global blockchain companies like MicroMoney aim to support this process allowing people with no credit rating score to enter Asian banks with positive credit histories. Now such companies work as a microfinance business helping the unbanked and underbanked people to provide their primary needs with payday loans.

  1. Consumer Population: The Asian population is about 4 Billion, which makes it one of the most densely populated continents of the world. From a business perspective, this means more speculative investors willing to risk. A recent study indicated that the average consumer in the Asia-Pacific region spends somewhere around $10000 to $100,000 compared to a measly $1000 in the United States. With South Korean exchanges outgrowing traditional stock markets, many people including some government officials believe that cryptocurrencies could replace fiat sometime in the future.

How Can Asian Consumers Stay Ahead?

Compared to adoption rates in the United States, there’s no denying that Asian consumer adoption rates are almost tenfold. Much of this has to do with the national government’s outlook towards cryptos in Asia compared to the rest of the world. In the US, for instance, there is a definite lack of clarity for cryptocurrency regulations. This makes the U.S. market, an unstable one to enter due to the lack of any concrete regulations. The picture is radically different for Asia, where regulations are more clear-cut and unambiguous. Regulators are receptive to the idea of blockchain integration and what it could do for the respective nations.

Another major factor is the degree of awareness of cryptocurrency technology in Asian countries compared to other nations. Asian consumers, on the whole, have much more of an understanding and education regarding distributed ledger technology. The tremendous potential of blockchain technology-based services further legitimizes it as a long-term investment.

How Asian Consumers Affect the Global Economy

It comes as no surprise that a region with a large percentage of crypto-users would impact the overall global economy. While blockchain technology is still in its fledgling stage, Asia looks to play a major role in increasing blockchain usability. For instance, in the petrochemical industry, some countries are already starting to break away from using the U.S. Dollar as a standard for transactions. They have started looking at cryptocurrencies and other means of digital payment as a solution. A perfect example would be Venezuela’s “Petro” cryptocurrency, which is backed by the oil reserves of the country.

The Blockchain Revolution is coming: Be Prepared

Many nations are now trying to figure out an alternative digital reserve currency, with the ultimate aim of dethroning the U.S. Dollar as well as fighting money laundering. China is already looking towards introducing its version of bitcoin, to substitute the Renminbi as the national currency.

Singapore has also become an attractive crypto-hub, because of its highly connected nature and linkages to global trade flows. Singapore is a key node in the trading of oil and gas and is looking to further expand in blockchain implementation.

Thus, Asia is poised to lead the way by embracing sensible regulations, coupled with more awareness and education about the subject. This, of course, doesn’t mean that there have never been any obstacles towards cryptocurrency adoption. It’s only last September when the Chinese government ordered a crackdown on cryptocurrency exchanges in the country with the regulations being eased. Japan has also shown a similar stance when seven major exchanges in the country were punished for violations. That being said, blockchain presents a wonderful opportunity to participate with life-changing innovative technologies, which could change the manner of how we live and interact in our daily lives.

Final Thoughts

Among the various benefits, blockchain tech provides, perhaps the key factors are decentralization, democratization, radical transparency, and self-data ownership. As Cryptocurrencies and Blockchain tech moves forward, so does the companies incorporating blockchain technology. Thousands of developers, entrepreneurs, investors, and users are coming up with innovations in the process of transactions, hash rate, wallets, exchange platforms, etc. Cryptocurrency security measures are also starting to get prepped up, with new protocols like Lightning Network, Segwit, Schnorr, TumbleBit, being developed by the best engineers in the world.