What are the main uses of cryptocurrencies?
Cryptocurrencies, also known as digital currencies, are virtual, intangible and decentralised currencies that operate thanks to blockchain technology. We explain the main areas in which the use of these digital assets can be beneficial.
Cryptocurrencies have positioned themselves as an alternative to traditional currencies for purchasing goods and services. More and more physical and virtual businesses are accepting cryptocurrencies as a method of payment. You can use them to purchase everything from commodities to luxury goods, as well as to book travel, subscribe to online services and much more.
Investing and trading
The high volatility of the value of cryptocurrencies generates mistrust among more conservative investors, yet makes them extremely attractive to less risk-averse investors, who can see their profits multiply. There is also the possibility to engage in cryptocurrency trading, taking advantage of fluctuations in the value of cryptocurrencies to make profits by actively buying and selling.
By cutting out intermediaries such as banks or specialised money transfer companies, cryptocurrencies can facilitate cross-border payments quickly, more cheaply or even for free if we make a wallet-to-wallet transfer. Blockchain technology makes it possible to send funds securely and directly anywhere in the world.
Crowdfunding and crowdlending
Some cryptocurrencies and blockchain platforms offer crowdfunding and crowdlending solutions. These platforms allow entrepreneurs to raise funds for their projects directly from investors, cutting out intermediaries and simplifying the funding process.
Smart contracts and decentralised applications
Smart contracts are digital contracts stored on a blockchain that are executed when certain predetermined conditions are met and without the involvement of any intermediary. These smart contracts enable a wide range of decentralised applications, such as voting systems, gaming, financial services and more.
Donations and charitable causes
Cryptocurrencies can be used as a way to raise funds for charitable causes and non-profit organisations. Some platforms allow users to make donations directly in cryptocurrencies, facilitating transactions and reducing the barriers associated with international transfers.
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