We can call “currency” those foreign currencies used in international trade. Currencies are the currencies of a specific country but used in other countries for global transactions.
You may have heard some of this explanation before, but a rather interesting fact is that these currencies can also be digital, which works as an excellent medium for virtual exchange that is equally present when we talk about physical currencies. But like almost everything, digital makes these transactions much easier, since they are instantaneous and continue to have the same value to acquire a physical good or some service. It does not have any geographical or political limitations, thus allowing payments or deposits to be made anywhere in the world.
Cryptocurrencies are the most representative digital currencies. The objective of cryptocurrencies is the same: to exchange money for money and to carry out transactions with money. Since there are no intermediaries in cryptocurrency transactions, using cryptocurrency to send money to other countries can save a lot of expenses by avoiding third parties.
Crypto is often preferred by many over common currencies due to the fact that there is manipulation in the forex market, which, as we examine its role and function, it is crucial to note that in order to determine the value of a currency and the implications of accusations They are for fraud.
The digital currency market underpins international trade and investment around the world. It is essential to facilitate import and export transactions, provide means of payment and adequate financing that can stimulate additional levels of demand for goods and services. Without the ability to trade in different currencies, business prospects would be limited and global economic growth would suffer.
Investors also benefit from the crypto digital currency market. Those who want to benefit from international diversification need foreign currency to buy and sell foreign goods or securities. Some investors view these currencies as an asset class unto themselves and generate alpha by trading them.
The problem with the common forex market, without any Blockchain system, is the low transparency of trading, combined with the fact that exchange rates affect too large a number of transactions, means that a benchmark is necessary. very high, a single exchange rate that reflects the value of one currency against another at a given time. This reference point is called a benchmark, and the process of fixing this reference point is called fixing.
It is terrible for many people as their safety is not guaranteed. What gives cryptocurrencies the step to stand out, since if something distinguishes cryptocurrencies it is transparency, speed, security and efficiency. Not only in its transactions, but also in the backup that each of the data that is developed throughout its use has. Someone who uses cryptocurrencies can be sure that they will not face risks in which their personal data is exposed.
In the same way, people are very doubtful of these because many do not have the backing of a bank, which makes it seem very risky to invest in something that may not show something tangible. But that does not leave aside that, there are cryptos that can be counted on that have their relationship with banks.
Such is the case of PP23PROJECT, which has more than 20 different currencies, such as the euro, dollar, pesos, pound sterling, among others, which undoubtedly allow bank transfers to be made, as many as necessary, whether at an international or national level. It seems hard to believe, but you can make direct debits of your receipts, transfers between your accounts to other users.
And that is why the main central banks in the world are studying the possibility of issuing digital currencies, which, unlike those cryptocurrencies that do not have backing, are guaranteed by the central bank, so that their value is as stable and safe as the role of currencies or some cryptos. These central bank digital currencies seek to achieve all the functions of traditional currencies and aim to counter what private virtual currencies represent.
The collateral of cryptos are so good that their purpose prevails and is getting stronger for the same reasons we already know: exchanging money for them and using them for transactions. Since transactions with these types of currencies are carried out without intermediaries, sending money to other countries using cryptocurrencies can save money by avoiding third parties.
But in the same way, although it is common to understand digital currency as cryptocurrency, if we speak technically these are not the same. Digital currencies can include a variety of common products, such as gift certificates, airline reward points, cash back on credit card purchases, and more. These digital currencies share similar characteristics in that they are a medium of exchange and function as money in their own right.
As in some cases, crypto is not backed by central banks, governments, or commodities, but is based on blockchain technology and can be used as currency and store of value. They are usually based on a decentralized peer-to-peer network.
Cryptocurrencies are a form of digital money, but differ in that they are not denominated in official currency and are not controlled by a centralized authority like virtual currencies. So that is an advantage.