We have seen unpredictable fluctuations in the blockchain technology. Some countries moved forward on Cryptocurrency. They have embraced and strengthened businesses to use this new age currency. Some nations had a sudden stop and stepped back due to the fear of the digital currency’s unpredictability.
We have seen the welfares and implication of cryptocurrency in the business sector. Now it is making its way towards the educational arena as some Institutions took a brave decision in accept digital currency payments.
The positive financial trend we see is a true testament to our desire to for a brighter future. This article will give you a comprehensive outlook on why we need to stop ignoring the obvious paybacks of cryptocurrency.
Top tech investor: Cryptocurrency is going to make money transmission free
- Tech investor Cathie Wood believes bitcoin’s rapid adoption will lead to free global money transfers and that “cryptocommodities” like bandwidth could be traded like oil or corn.
- Wood is CEO of ARK Invest, a $1.7 billion investment manager. Before ARK, she spent 12 years at Alliance Bernstein.
- Bitcoin hit a record high of $5,856.10 Friday, according to data from industry website CoinDesk, surpassing the market capitalization of major stocks like Goldman Sachs.
Cryptocurrencies like bitcoin will become so valuable and widespread that all money transfers are going to be free, according to a top tech investor.
Cathie Wood, the CEO of ARK Invest, said the internet doesn’t have a built in payments system because it wasn’t conceived as a place of commerce. Bitcoin and other cryptocurrencies are “helping to solve that problem and cut out a lot of friction.”
For example, she said, 20 percent or more of money transfers in the region between the Philippines and South Korea are taking place over bitcoin “but the sender and receiver don’t know it.”
ARK Invest manages $1.7 billion of assets in funds focused on disruptive technology. Prior to ARK, Wood spent 12 years at Alliance Bernstein as chief investment officer of global thematic strategies, where she managed $5 billion.
Traditional money transfer services like Western Union charge 7 to 8 percent per $100 of money transferred from one country to another, a big price for migrant workers who want to send money home to their families. “That’s a huge cut, right?” argued Wood. But if cryptocurrency transfers can put pressure on traditional companies, those expensive transmission fees may not be around for much longer.
“Right now, you pay the conversion fee from fiat currencies into crypto and back again and those [rates] are 2 to 3 percent. That’s a lot better already,” she continued. “But we think that the data is going to be so valuable that money over IP is going to be free because the transactions will be the information that companies want to get after.”
Bitcoin hit a record high of $5,856.10 on Friday, according to data from industry website CoinDesk. Its market capitalization, which is the total value of all the bitcoin in circulation, reached $96.7 billion, according to Coinmarketcap.com. That surpassed the market capitalization of major stocks like Goldman Sachs and Morgan Stanley.
If it were a stock at its current size, bitcoin would be the 15th largest component of the Nasdaq and the 58th largest on the NYSE. Though bitcoin has been on fire all year, investors are attributing the most recent rally to reports that China could reverse its ban on cryptocurrency exchanges.
Given the importance of computing technology in the modern era, Wood also questioned whether the markets are lacking some key commodities.
“It’s interesting that you’ve got corn and oil and copper trading on the exchange but you don’t have computing power, and bandwidth, and storage,” said Wood. “Well we think that’s going to happen because of blockchain technology and all of the cryptos that are coming along.”
The investor said that ether, a unique piece of code that is used to pay for the computational resources needed to run an application or program, is more like a “cryptocommodity.” Ether serves largely as a “fuel” in the generation of cryptocurrency.
“These markets are huge. We believe that digital services are as integral, or maybe more integral to our lives, than commodities that are traded on exchanges right now.”