Technological advances are changing our landscape in every area of our life, it is logical to think that the way we pay for our goods and services is also changing; Currently we can see how Cryptocurrencies are already part of our lives, whether we use them or not, the fact that blockchain technology has been so influential in the last decade gives us an indication of why many countries in the world are already planning in creating or converting your local currency into a digital token.
It is likely that many people find it hard to believe that in a couple of decades the use of cash or physical money will very likely be a thing of the past, but it is something very normal, since in each generational evolution there has always been a rejection of change, It happened in the 18th century when paper money began to be used instead of silver coins, and it happened in the 1960s with the spread of credit and debit cards.
And speaking of credit or debit cards, what many detractors of digital money do not know is that they have already been using it without knowing. At the beginning of this new millennium in the year 2000 most of the global financial transactions began to be carried out electronically with the development of the internet and web. More than 80% of today’s transactions are carried out with electronic money that is not in cash but as simple electronic data on a server
Currently, the interest shown by financial institutions in the digital dynamics offered by Cryptocurrencies together with blockchain technology is notable, so much so that many countries have already begun the development of their own digital currency that they intend to implement when necessary.
Many financial institutions have chosen to create their digital currency since it offers very positive changes, since with the printing of paper money a relatively large expense is always incurred, as well such as having absolute control of the flow of money in a nation and avoiding the use of economic strategies against it, such as sanctions or avoiding the use of international banking channels.
Of course, just like cash, the control of this digital currency will always be from the issuing central bank, therefore it will be the opposite of what Cryptocurrencies such as Bitcoin “decentralization” seek, however many of these projects make use of blockchain technology.
Currently in 2022 there are already 8 countries that have their own digital currency, including a great economic power such as China.
The Caribbean is a region that has advanced by leaps and bounds in this process of change. We can currently find 5 countries in this region that have already developed and launched their own fully digital local currency issuance system, and like the Cryptocurrencies makes use of the blockchain as a transactional registration system, in this region we can find the Bahamas with its digital currency called Sand Dollar, Jamaica with Jam-Dex, a group of Caribbean island countries (Saint Kitts and Nevis, Antigua and Barbuda, Saint Lucia and Grenada) have created together with the Central Bank of the Eastern Caribbean their digital currency called Dcash.
In Africa we can also find Nigeria as a pioneer country that since 2021 became the first African country to launch and make an official digital currency issued by its central bank, said currency was called eNaira, and despite the fact that Nigeria is a country where the adoption of Cryptocurrencies is very common, the citizens themselves have not fully accepted this currency yet, so the Nigerian government is looking for plans to encourage its use, since they have a very technological infrastructure.
Finally we have China, the Asian giant, despite the fact that its digital currency is not fully open to the entire population, already has all the necessary infrastructure for its operation, the Chinese digital Yuan is in a trial period and it is expected that it will be fully available to the Chinese population in the coming years, thus being the first Global Power to adopt the digital system in its monetary policy.
Although it seems to many that there are still very few countries that have chosen to implement this new paradigm of digital currencies, nothing could be further from the truth, since there are currently several countries that have pilot plans or are developing projects to include their currency to the electronic field.
Currently we can find countries that have created or developed their own pilot plan for a digital currency, such as Russia, South Korea, Thailand, Indonesia, the United Arab Emirates and Saudi Arabia, some of these countries have adopted many of the most influential Cryptocurrencies, so it is not uncommon for countries like Russia to be on this list.
And we can also find other countries that have published plans to create their own digital currency issued by their own central banks, but seek to gradually develop their infrastructure and not make an abrupt change such as Canada, Brazil, India, and others.
This new monetary paradigm is not a fashion that has been implemented by a few countries, studies show that the adoption of these is increasing, so much so that it is estimated that by the year 2040 the use of digital currencies will be as normal as using cash today.
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Currently we can already demonstrate a coexistence between digital currencies and cash, but according to studies it is estimated that in the coming decades cash will disappear.
This is due to the great technological change that has been imposed around the world, with the appearance of Cryptocurrencies, many governments have realized that the use of digital currencies is not as unreasonable as it might sound in previous years, in addition to currently maintaining an economy with Physical money is much more expensive than using digital money.
One of the biggest criticisms made of digital currencies is that because they are not a decentralized digital asset, they have a central entity that can issue them when necessary, which would imply that these currencies are susceptible to inflation, another criticism is that, being a fully digital currency, it can be traced if designed that way, therefore the anonymity that cash or some Cryptocurrencies possessed disappears.