Cryptocurrency and Blockchain technologies are disrupting the technology landscape for sure. Right from small businesses to giant multinationals, right from grocery stores to financial institutions, everyone is talking about leveraging blockchain and changing the course of their industry altogether.
Cryptocurrencies that were once perceived to be evil, and were only associated with the dark web, have attracted the attention of almost everyone with the rise in the prices of Bitcoin that happened last year. Now, everyone is betting big on the success of the currencies as well as their underlying technology Blockchain.
Blockchain and Cryptocurrencies are all set to disrupt the stock markets now. While this goal is an ambitious one, it is not very far from reality. Only recently, Wall Street went down from being promising and optimistic to really depressing. What was shocking for analysts and researchers was the fact that the cryptocurrencies closely resembled the behaviour of the traditional financial market.
It is then that the question of the traditional finance market affecting cryptocurrencies and vice-versa sprung up. Another question this leads us to be how much correlation exists between these two markets.
1. Challenging the Dollar Standard
While up until now, the US Dollar was termed and perceived as the reserve currency of the global economy, with the rise in the use of cryptocurrencies, the trend might take a toll. The US Dollar lies at the core of the financial web that is spread all over the world. As an example, the 2008 global financial crisis that started in the US spread like wildfire to other parts of the world as far as Iceland.
This centralisation and the authority of the US Dollar is being challenged, and at the same time, disrupted by the rise in cryptocurrencies. Financial transactions are being decentralised at a rapid pace with the advent of the most popular Bitcoin and about 1,000 other cryptocurrencies.
The dynamics of international trade can be changed once and for all with the help of cryptocurrencies. There always have been attempts to get the US Dollar off its throne, and the rise in cryptocurrencies might be the last nail.
2. Investing in stocks and Crypto-trading
Trading in the cryptocurrencies market fulfils for some people the same purpose as trading in the traditional stock market does. Profit, ownership, and motivation are the three plain reasons why people have been investing in the stock market since forever, and all these reasons are fulfilled by the cryptocurrencies market too.
The investors who love to go global can do so easily with cryptocurrencies. While investing in stocks that are out of your home country is a painstakingly long process, the alternative to it, crypto-trading, might prove to be beneficial for the truly global investors.
Initial Public Offerings have smoothly been replaced by Initial Coin Offerings. Investing in companies that open ICOs is so effortless that it might be preferred over the traditional methods by almost all of the investors in the near future.
ICObench is a company that lists ICOs from about 70 different companies and confirms the fact that stock markets are begin disrupted by the invaders called cryptocurrencies.
Investors today are of the opinion that if the prices of Bitcoins can surge in a week like they did, why can’t the same happen with other currencies and the companies that are leveraging these currencies, too.
It has been easy up until now to ignore cryptocurrencies in all their merit, but soon things are about to change. The world will witness the staying of cryptocurrencies as alternate ways of investing, or maybe, the primary ways of making investments.
Cryptocurrencies are set to affect the real financial market and not just a bit!
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