Crypto-currency and blockchain are in the early stages of a potentially transformative global technological movement. Although in their infancy, the significance of their impact has already begun to emerge.
The benefits of crypto-currency are indisputable. Speed and ease of transaction, as well as lower fees, are obvious initial attractions for merchants and users alike. The transparent, decentralised nature of crypto, thanks to the underlying blockchain technology, is another key advantage – all transactions are tracked digitally upon the distributed public ledger in a permanent and traceable way.
Being an early adopter of cryptocurrency-enabling DLT can also put a business in a position of advantage, as one is able to observe technological advancements and lead the way in further innovative developments. This is evidenced by the countless industries now competing to implement blockchain technology in a variety of inventive ways unrelated to its initial virtual asset-related purpose.
Healthcare is one of the many sectors beginning to recognise the potential power blockchain technology could bring. The technology could offer a secure way of recording and sharing sensitive patient information, as well as a way of avoiding data breaches. While many healthcare providers accept the implementation of this will be hugely beneficial, the current lack of understanding about the technology itself means it is yet to be adopted on a wider scale.
Crypto-currency is in a similar position. Its benefits are widely acknowledged, yet it is still shrouded in uncertainty and met with caution. Despite its evident perks, crypto-currency is still viewed by many as being somewhat suspicious. This belief most likely comes not only from its slightly dubious beginnings from within the dark web, but also from the fact a significant number of countries are still reluctant to regulate it. This is not the case for pioneer of crypto and blockchain technology, Malta, which made history this year as the first jurisdiction to establish a regulatory framework for both.
While Malta might be steaming ahead towards a blockchain-based future, the rest of the world is still lagging behind. The widespread adoption of crypto-currencies, which has been anticipated for some years now, is still far from being realised. Their current lack of utilisation on a large scale is due to a number of factors. The main ones are the regulatory uncertainty still surrounding them and the simple fact traditional payment methods currently surpass digital payment methods in terms of convenience and practicality.
On top of this, the unstable nature of conventional crypto-currencies such as bitcoin, caused by their dramatically fluctuating price, means they are too volatile to be regarded as “money.” This fluctuating price, determined by its varying supply and demand in the marketplace, creates an element of risk for those considering investing, or using them – the volatility that comes with crypto-currencies is making many companies hesitant to adopt them as a form of payment.
Whereas conventional crypto-currencies pose problems in terms of practical everyday use, stablecoins theoretically offer a solution for this. Pegged to a secure, external asset,the stablecoin is able to hold a stable value over time. The most common type of stablecoin has a value equating that of a fiat currency, often the US Dollar – its price is able to remain fixed since it represents the corresponding amount held in reserve as collateral.
So, while they are crypto-currencies in the sense they offer security and decentralised control, they also aim to mimic the stability of fiat currencies and do away with the volatility traditional crypto-currencies can’t avoid. The stablecoin is essentially a stepping stone between fiat and crypto-currencies.
The stablecoin concept is a simple one which is understandably appealing to investors.The adoption of a stable, decentralised digital currency could in turn accelerate the adoption of crypto-currencies in general, along with that of blockchain technology – although such results may not be visible in the immediate future. Banks and financial institutions, in particular, are proving eager to get on board, as the stablecoin represents an innovative way to improve the efficiency of operations. At the same time, it does not differ enough from current, conventional methods to cause significant disruption.
It is still early days for the stablecoin, so it is naturally facing challenges. Its successful implementation, however, could fill a much-needed gap and bring us one step closer to a more stable, functional future for crypto-currency.
GanaEight Coin Ltd, a Ganapati Group company, is looking to be the first to utilise both blockchain technology and online gaming expertise to produce a game-changing casino stablecoin, the G8C. The G8C token represents an innovative and secure way of bridging the gap between virtual assets and the casino industry. Come and meet Ganapati and G8C on Stand P313 at SiGMA 2018.