Technology has revolutionized all aspects of our lives and, for the past few years, also money. Electronic money, fintech and cryptocurrencies will be the keys to the future of money.
Although we have already experienced many changes in the financial world, being able to send money in seconds or paying through cell phones, everything points to the fact that technology will transform the financial system as we know it today.
Electronic money is a reality as it includes any payment system that involves a digital medium. Without going any further, when we pay with Paypal, with a credit card or make a bizum, we are using digital money. However, the concept is becoming broader and for some years now we have also been talking about cryptocurrencies. But…
What is a cryptocurrency?
It is a digital asset that uses encryption to guarantee its ownership and ensure the integrity of transactions. This controls the creation of additional units and prevents anyone from making copies. All these coins are stored in a digital wallet.
How do cryptocurrencies work?
The big difference compared to traditional monetary systems is that cryptocurrencies are not regulated or controlled by any institution and do not require intermediaries to make transactions. A decentralized database, blockchain or shared accounting record, is used to control these transactions.
Once you make any type of transaction, i.e., when you buy or sell an asset, you cannot cancel the transaction because the blockchain is a record that does not allow you to delete data.
Digital wallets, or wallets, are software where cryptocurrencies can be stored, sent and received. These wallets are protected with keys and the loss of these keys can mean the loss of the cryptocurrencies without the possibility of recovering them.
Cryptocurrencies work through the shared accounting register or blockchain. This technology provides a high security system that prevents cryptocurrencies from being counterfeited.
Fintech, the other great revolution that is changing the future of money
Technology and finance have always gone hand in hand, and even more so since the Internet revolutionized our lives. We have changed the way we shop, pay bills, and transfers are carried out through more innovative products.
How are fintech companies classified?
- Those offering online loans and credit
- Mobile banking
- Solutions that allow you to buy and sell cryptocurrencies
- Mobile payments
Do you know which are the main companies in the sector? Discover the 7 fintech startups that you must know.