The prediction that digital currencies will account for 98% of transactions in the not-so-distant future, while ambitious, is based on a series of trends and fundamental advantages that digital currencies offer over physical money and traditional financial systems. Here are the key reasons:
1. Efficiency and Lower Costs:
* Elimination of Intermediaries: The blockchain technology that underlies most digital currencies allows for direct (peer-to-peer) transactions without the need for banks, clearinghouses, or traditional payment processors. This drastically reduces transaction costs and settlement time.
* Faster and Cheaper Global Transactions: Sending money internationally with digital currencies is significantly faster and cheaper than traditional bank transfers, which can take days and have high fees.
* Automation and Smart Contracts: The ability to program smart contracts on the blockchain allows for the automation of agreements and payments, reducing the need for human intervention and eliminating errors.
2. Accessibility and Financial Inclusion:
* For the Unbanked Population: Digital currencies, especially cryptocurrencies, do not require a traditional bank account, only a digital wallet and internet access. This opens doors to financial services for millions of people worldwide who currently have no access to banks.
* Ease of Use: As technology advances, the interfaces of digital currency applications are becoming more intuitive and user-friendly, even for people without advanced technical knowledge.
3. Security and Transparency (based on Blockchain):
* Immutability and Traceability: All transactions on a blockchain are recorded in an immutable and transparent manner, making fraud and manipulation difficult. Each transaction leaves a "trace" that can be tracked.
* Resistance to Censorship: In the case of decentralized cryptocurrencies, transactions are resistant to censorship or control by a single entity, whether it be a government or an institution.
* Advanced Cryptography: The security of digital currencies is based on advanced cryptography, making them inherently more secure than many traditional payment systems.
4. Evolution of Central Banks (CBDC):
* Central Bank Digital Currencies (CBDC): Many central banks around the world are exploring or developing their own digital currencies (CBDC). These CBDCs are a centralized form of digital currency, issued and backed by a country's central bank, seeking to combine the benefits of digital currencies (efficiency, security) with the stability and backing of a monetary authority. China is already actively testing its digital yuan, and other countries are following suit.
* Replacement of Cash: The long-term goal of some CBDCs is to replace physical banknotes and coins, which would significantly boost the adoption of digital money.
5. Institutional and Market Adoption:
* Institutional Investment: The approval of ETFs (Exchange-Traded Funds) based on Bitcoin and other cryptocurrencies has opened the door to large-scale institutional investment, legitimizing these assets and attracting more investors.
* Commercial Acceptance: More and more businesses, from large corporations to small businesses, are beginning to accept payments in cryptocurrencies, driving their everyday use.
* Technological Integration: The integration of blockchain technology into existing financial systems by financial institutions and fintech companies will accelerate adoption.
Challenges to Overcome:
Despite these advantages, the massive adoption of 98% is not without challenges:
* Regulation: The lack of clear and harmonized regulation at a global level is a significant obstacle. Governments are working on regulatory frameworks, but the pace can be slow.
* Volatility: The high volatility of many cryptocurrencies (especially those not backed) remains a concern for daily use and long-term investment. CBDCs and stablecoins aim to mitigate this issue.
* Knowledge and Education: There is still a significant gap in knowledge and understanding of digital currencies among the general public.
* Infrastructure: The scalability of certain blockchain networks and the need for robust infrastructure to handle a massive volume of transactions are technical challenges.
* Privacy: Although blockchain offers transparency, user privacy remains a topic of debate and development.
The convergence of technological efficiency, the demand for greater financial inclusion, the evolution of central banks, and the growing institutional acceptance suggests that digital currencies are on track to radically transform the financial landscape. While the exact percentage and timeframe are difficult to predict, the trend toward a future dominated by digital money seems inevitable.
