Crypto vs Fiat In what trust the society more?

By Krapottke | Crypto and society | 5 Apr 2022


 

People trust in their dollars or euros or yen even though they are constantly losing value. Then why do they distrust the cryptocurrencies when they even tend to rise?
What are the differences between the currencies of the states and the cryptocurrencies and what advantages and disadvantages do they have?

Definition

Let's start with the definitions of the two types.

Fiat currencies (dollars, euros...): Fiat money is an economic object without intrinsic value that serves as a means of exchange. The value is secured by the power of the government to prescribe the currency as legal tender.

Cryptocurrencies: currency based on a cryptographic system.

Comparison

The advantage of fiat currencies is their general acceptance and that they are prescribed as a means of payment. That's why the majority accept them as safe and many do not come into contact with anything else.
On the other hand, they only heard something about cryptocurrencies.
The already mentioned contact with fiat currencies comes from the fact that the working person gets it as a salary and is not paid in Bitcoin, although I have heard about this possibility.

Another factor is the prices that accompany you in everyday life. All are based on the respective national currency and you do not buy a new mobile phone with Bitcoin or Ethereum or there are only a few states where this is possible.

However, the sometimes extreme volatility of cryptocurrencies is probably the biggest point of uncertainty. Human just doesn't like to have the opportunity to lose everything, even if it is small. In addition, this loss is shown more clearly than inflation, which is creeping.

It is also worth mentioning the control of fiat currencies by the state or other bodies, which offers security, but it remains the dependence of it and thus the headquarters. On this point, cryptos are freer and your assets cannot be frozen by the state.

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Result

Fiat currencies are considered safe, because the contact with them is usually greater and the depreciation creeps, so usually takes place unnoticed.

Whether they are the future or perhaps the cryptocurrencies will become clear in the next few years.

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Krapottke
Krapottke

Just another young crypto enthusiast, but with a view to society


Crypto and society
Crypto and society

In this blog you can find out about Crypto in relation to the society . What do older people think about the topic? What is thought of NFTs? Which cryptocurrencies are accepted or more likely to be accepted than others? These questions and others are dealt with here.

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