The future of cryptocurrencies and their impact on the global economy (2024)

Cryptocurrencies have the potential to significantly transform the global economy in the future. With the maturation of blockchain technology and its growing acceptance, cryptocurrencies are expected to be more widely incorporated into regular financial transactions. This transition has the potential to result in enhanced financial inclusivity, as those residing in underprivileged areas acquire the ability to utilize banking services via their cellphones.

Furthermore, cryptocurrencies provide a decentralized option to conventional banking systems, which could decrease dependence on middlemen and enable quicker, less expensive, and more secure transactions. This could be especially advantageous for residents in nations with volatile or inflationary currencies.

Nevertheless, there are still substantial obstacles in the form of regulatory issues that need to be overcome for widespread implementation. Nations worldwide are facing the challenge of properly regulating cryptocurrencies without impeding innovation. Furthermore, there are ongoing concerns regarding security, volatility, and environmental impact.

Although facing obstacles, the ongoing advancement of cryptocurrencies and blockchain technology is expected to have a significant influence on multiple areas of the worldwide economy, including as finance, supply chain management, healthcare, and others. With the increasing acceptance and evolution of this technology, the complete magnitude of its influence on the global economy is yet to be determined. However, there is considerable potential for beneficial transformation.

In their publication “Global drivers of cryptocurrency infrastructure adoption” in Small Business Economics (2020), Saiedi et al. assert that cryptocurrencies have generated substantial interest owing to their potential influence on the global economy. The rise of virtual currencies, including cryptocurrencies, has been a prominent characteristic of the modern economy in the twenty-first century.

The surge in cryptocurrencies can be attributed to several factors, including the repercussions of the COVID-19 pandemic, economic turmoil, and the worldwide escalation of inflation. Additionally, the growing acceptance and utilization of cryptocurrencies by individuals globally, as highlighted by Smutny et al. in their publication “Motivations, barriers and risk-taking when investing in cryptocurrencies” in Mathematics (2021), have played a significant role.

In their publication “Understanding the adoption of cryptocurrencies for financial transactions within a high-risk context” in The Journal of Risk Finance (2022), Dabbous et al. observed that cryptocurrencies, like bitcoins, have experienced significant expansion, permeated financial markets, and transformed the functioning of the global economy.

In their paper titled “Bibliometric analysis of scientific production on international trade and cryptocurrency” in the International Journal of Advanced and Applied Sciences (2021), AVŞAR & Serin assert that cryptocurrencies are anticipated to significantly transform the digital assets and financial sectors in the future.

The economic significance of cryptocurrencies should not be underestimated, as demonstrated by the legalization of cryptocurrency transactions in countries like Korea and Japan. This development has had a significant influence on their respective economies, as highlighted by Amsyar et al. in their article “The challenge of cryptocurrency in the era of the digital revolution: a review of systematic literature” published in Aptisi Transactions on Technopreneurship (2020).

In the release “Building a digital economy (the case of BRICS)” on SHS Web of Conferences (2021), Gusarova et al. defined the introduction of blockchain and cryptocurrency in the BRICS countries as a major step towards developing a digital economy. They emphasized the potential benefits, challenges, and future prospects associated with this transition.

Various researchers, such as Kala & Chaubey, Qureshi & Zaman, and Namahoot & Rattanawiboonsom, have examined the factors that influence the future adoption and continuation of cryptocurrencies. These factors include the perception of government control, engagement on social media, and the intention to adopt cryptocurrency platforms.

In the research titled “Determining the economic impact of cryptocurrency adoption on international trade from a gravity model framework,” by Chen, states that the potential influence of cryptocurrencies on international trade is a topic of interest. Expanding the adoption of cryptocurrencies can increase their impact on the global economy.

Nevertheless, Rosele et al., in their article titled “The concept of wealth (māl) in the sharīʿah and its relation to digital assets” published in Sage Open (2022), emphasize the significance of exercising prudence when engaging in cryptocurrency investment due to its limited track record and the challenges associated with forecasting its future stability.

Moreover, the willingness of financial institutions and governments to embrace cryptocurrencies will have a significant influence on the future of cryptocurrency and its effects on the global economy, as stated by Pastory & Mahwera in their publication “Financial institutions readiness towards cryptocurrency adoption: a case of banks in Tanzania” in the Journal of Business Management Review (2022).

In a nutshell, cryptocurrencies have the capacity to greatly transform the global economy in the future, impacting industries like finance, trade, and tourism. Nevertheless, it is necessary to take into account the legislative, technological, and economic elements that will shape the extensive acceptance and influence of cryptocurrencies on the global economy.

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