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Digital currency vs. Money - Essay Example

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Digital currency is a medium of exchange that is based on the internet (Uwajeh 345). It exhibits similar properties to physical money but it allows…
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Digital currency vs. Money
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Digital currency vs. money Introduction Digital currency is increasingly becoming popular as opposed to money though it has its fair share of advantages and disadvantages. Digital currency is a medium of exchange that is based on the internet (Uwajeh 345). It exhibits similar properties to physical money but it allows for instant transactions and the borderless ownership transfer. Like money, these digital currencies can be used to purchase goods and services though they can be restricted in some communities. Some of the digital currencies including bitcoin have no central control point over the supply of money (Vigna and Casey 56). Money on the other hand is an item accepted as the payment of various goods and even services and debts repayment in a socioeconomic context.
Why people are switching to digital currency
People are increasingly switching to digital currencies due to lack of trust in actual money. The increased cases of theft and pick pocketing are increasingly necessitating for individuals to use digital currencies (Mullan 567).
Critics of digital currencies over money
There are other individuals who claim that they should never switch to digital currency due to inconvenience especially in remote areas. There are places where one can never use a digital currency (Kubota 200).
Advantages of money
Economical since it costs nothing to the government making it a cheap medium of exchange
Homogenous since it must be the same type
Convenient since it is used everywhere even in remote areas
Cheap remittance from one place to another
Disadvantages
It is of no use outside its country of issue
Theft and pick pocketing together with other damages to the paper money.
Danger of over issue in a country
Advantages of digital currencies
Freedom in payment at any part of the world
Control and security
Low fees in its payment
Fewer risks in terms of theft, or damages
Disadvantages
Not used in some parts of the socio-economy including the remote areas
Might be expensive to acquire
Works Cited
Kubota, Takashi. Cyberlaw for global E-business. Hershey PA: Information Science Reference, 2008.
Mullan, Philip. The digital currency challenge. Basingtoke: Palgrave Macmillan, 2014.
Uwajeh, Alex Nkenchor. Bitcoin and Digital Currency. New York: Alex Nkenchor Uwajeh, 2007.
Vigna, Paul and Michael J Casey. The age of cryptocurrency. New York: St. Martins Press, 2015. Read More
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