What Is The Future of Digital Currency?

“What is the future of digital currency?”– This is a question I hear a lot about in the news, between friends, and from key industry figures, as the furore around what is the future of a digital currency heats up.

With Bitcoin featuring heavily in the news, especially due to its increase in value, and the fact that China has taken significant steps to ban it, what does the future hold?

Will the spotlight on digital currency seek in increase its popularity? Will we see it make moves to overcome traditional money on a global scale? Or will it crash at burn like many other fads before it, only to be resigned to history along with things like Pokemon Go and the Blackberry?

Let us read on to find out more about the ins and outs of digital currency, as well as where it could be heading in the near, and far future.

What Is a Digital Currency?

Predicting the future of digital currency

First things first, unless you have been living under a rock for the last ten years, the chances are that you have probably heard about a little something called digital currency.

A digital currency/digital money/electronic money/electronic currency is a type of money which is non-physical (as in, not represented by banknotes and coins) and exhibits properties that are similar to real coins. It is however entirely digital, meaning that it exists through lines of code and digital representation and can be traded through a computer or an online platform instantaneously and offers the users a borderless transfer of ownership.

While it is similar in many ways to traditional types of currency, regarding the way it acts and that it can be exchanged for goods and services, it differs in much more.

A digital currency is not backed up by assets such as gold reserves or similar. Likewise, it is not regulated or overseen by any government authority or bank. Therefore, its value and the way it functions are completely controlled by the public domain, and or its creator, meaning that its success and value are entirely out of the grips of a centralised authority.

This makes it a desirable prospect for many who look to make purchases and investments without being at the mercy of a bank. Individuals can make anonymous transfers and keep their finances truly confidential.

How Did Digital Currency Start?

Digital currency was an idea that was around in theory for quite a long time, but it wasn’t until 1983 that a man called David Chaum published a research paper which introduced the concept of digital money. By 1990, he had founded DigiCash in Amsterdam which was an electronic payment company, and it aimed to commercialise the ideas in his research.

Following this, in 1997, Coca-Cola offered customers the option to buy from vending machines using their mobile phones, and by 1998, PayPal had hit the market. Other names were emerging at the time such as e-Gold and Liberty Reserve which enjoyed their fair share of controversy, but by 2008, Bitcoin had been born.

Many believe that the introduction of Bitcoin was the real birth of the digital currency, and its ongoing success to this day is tantamount to that.

The issue with digital currencies such as Liberty Reserve and e-Gold was that they were often used for money laundering, and as such, they were quickly shut down by the US Government. Then in China, the use of a digital currency called Q Coins, was so popular that it was said to have a destabilising effect on the Yuan- something that could help to explain China’s recent crackdown on Bitcoin trading in the country.

Since its humble beginnings, its evolution has moved at a rapid pace. Nowadays, we have a wide selection of currencies to choose from including PayPal, eCash, WebMoney, Payoneer, CashU, and Ven. Consumers can also choose from digital wallets that are stored on their mobiles that can facilitate contactless payment.

The concept of digital money has also evolved into decentralised systems such as cryptocurrencies. A cryptocurrency is a digital token which requires cryptography for facilitating both its mining, and its transfers through peer-to-peer networks.

Cryptocurrencies allow electronic and digital money systems to be completely decentralised, and therefore under the authority of absolutely no one. Examples of such currencies include; Bitcoin, Litecoin, Ripple, Dogecoin, Monero, Zcash, IOTA and Ethereum.

What Are the Most Popular Types of Digital Currency?

The future of digital currency


Otherwise known as the “de facto” digital currency, it launched in 2009, and its popularity has gone from strength to strength. When it started out, its value was equivalent to $1- now it is over $4000, and despite various curveballs and controversies threw its way, it continues to flourish. In some countries, you can even find Bitcoin ATMs, and some online retailers let you purchase their products and services by using the currency.


Launched in 2011, it is often referred to “silver to Bitcoin’s gold”, and it was created by MIT graduate and former Google engineer, Charlie Lee. Based on an open source global payment network, it is not controlled by any central authority, and it uses “scrypt” as a proof of work which must be decoded with the help of a consumer grade CPU. While Litecoin is similar to Bitcoin in many ways, it has a much faster block generation rate and offers clients and customers a faster transaction confirmation.


Created in 2015, Ethereum is a decentralised platform which enables the use of smart contracts to be created without any downtime, a risk of fraud, or control from any third parties. Its cryptographic token is known as an ether, and it is highly sought after by developers that want to run and develop applications in Ethereum. It can be used to “codify, decentralise, secure, and trade pretty much anything”.

What Do Governments and Banks Think of Digital Currency?

The general reaction to the concept of digital currency and cryptocurrencies is not a positive one. While they stick to the story that their arguments revolve around concerns of regulatory risk and a lack of compliance or any form of accountability, many believe that the real reason runs a little deeper.

Particular in the US, many Bitcoin businesses and start-ups have found themselves shut down or ordered to cease trading- the reason being concerns over money laundering and the above-mentioned compliance issues. But many see this as a direct assault on the freedom of these operators, and an attempt to stop free trade and the ability of citizens to control the value of their own money.

It comes as no surprise that some of the banking world’s most senior figures have spoken out against Bitcoin and other currencies of its type, as it is in their vested interest to ensure that nothing could ever take the place of traditional currency- something they make billions out of every second.

That said, a senior banker who wished to remain anonymous, attended a recent Bitcoin summit in Australia. He explained that the reason for the financial industries distrust of digital currencies is due more to the fact that it is hazardous for financial institutions and banks to have Bitcoin on their books.

Aside from the fact that to purchase and trade in such currencies, there is nothing in the way of KYC requirements; it is things like the changing laws around Customer Due Diligence which poses additional problems. If transactions and individuals that are affecting such transactions cannot be traced or identified, it can leave the bank taking a significant risk as to whether they want to be a part of it.

It is just too risky for banks to get involved with, and in an industry where time is money, spending extra time on DD and KYC, and being able to cover penalties or fines- should anything go wrong, is a risk that many just do not want to take.

When it comes to governments, many have refused to acknowledge it as a form of money at all, while some have made moves to either ban, or severely restrict its use, or the ability to trade it. It seems to many that a lot of governments are resting on their laurels in refusing to legislate against such a sensation, but in fact, many are probably waiting for the right moment to decide.

To them, the future of digital currency is full of uncertainty, and as it is a relatively new concept, they may well bide their time before making any proper decisions. After all, what is the point in outlawing something that may disappear in 5 years? Or more to the point, why make something illegal unless you can work out how to make money from it!

What Is the Future of Digital Currency?

the future of cryptocurrency

This is quite literally, the billion-dollar question and one that not many know how to answer. There are over 740 types of such coins, and this is a number that will continue to grow. Many believe that as soon as one dies out, or is made illegal, another will just simply pop up in its place. The way things are at the moment, it seems very unlikely that as a concept, it will die out together.

The truth is, that after several global financial crises’, and a growing public distrust of banks and governments – people love the idea of a currency that is controlled by no one. With an ever growing feeling that big brother is watching, being able to buy, sell, save, invest, and trade without being monitored, held accountable or observed by a third party.

It gives people freedom, and by disassociating from centralised systems and authorities, it gives power back to the public to control their wealth and the value of the money that they have.

With the ever-present risk of economies collapsing, currencies are devaluing, and with banks holding every nation purse strings increasingly tighter – the concept of digital currency is a very welcome one and one that is not likely to be unpopular anytime soon.

The banks and bankers can try to talk down the value and significance of digital currencies as much as they like, but the reality is that people using such currencies are unlikely to listen. Whether what they say is the truth or not, the likelihood is that due to their vested interest in digital currency failing, people will discard what they say as biased or with an ulterior motive.

We predict that the popularity of digital currencies and cryptocurrencies will continue to flourish and that there is very little that banks, governments or other authorities can do to stop it. The very nature of the beast is that it is adaptable, responsive, and extremely technologically apt, meaning that the developers behind it can overcome virtually any hurdle that will be thrown at them.

The only cause for concern is for those that have invested millions in such currency, as the reliability of each currency cannot be 100% guaranteed, caution must still be exercised when taking risks involving significant amounts of money.

We believe that digital currency is the future and that sooner or later, the banks and government must concede defeat and instead work towards working in harmony with those that are creating and purveying digital currencies in all of its forms.


What do you think is the future of digital currency? Whats is your country’s view on digital currency? Let us know in the comments below and if you enjoyed this article, don’t forget to follow us on Facebook!