The fiat monetary system is outdated in many aspects.Traditional payment networks rely on slow and robust transfer validation mechanisms that use centralized security systems, and require a lot of bureaucratic procedures to operate.These processes not only take forever, but leave the actual asset owners in the dark and unable to control how their money is handled.
Even though crypto has established itself as a much faster and more reliable method of payment and trading, factors like high volatility and a lack of clear regulations often intimidate users and cause them to err on the side of caution and stick to TradFi solutions.
Let’s take a look at the different factors between crypto and fiat that influence uncertainty among users.
The Relative Stability of Fiat and TradFi Fiat currencies are relatively stable assets, and their value fluctuates very little over time, except in the case of dramatic political and economic events, such as economic crises, which might trigger rapid value fluctuation for fiat currencies.Even in such circumstances, fiat money only changes its value by small percentages, which is a much more stable fluctuation than what we sometimes see in crypto.
In addition, fiat is accepted everywhere in the world.You can travel almost anywhere and exchange various fiat currencies at exchange offices to acquire a locally accepted currency.This is possible because every fiat currency is backed by government institutions and your money can always be exchanged for another fiat currency without fear of it losing its value.
Crypto Volatility Crypto is much more volatile than fiat currencies and company stocks.It’s pretty typical for Bitcoin (BTC), Ethereum (ETH), and other leading cryptos to have their price rise or fall several percent within a few hours.
This extremely high volatility is considered one of the greatest factors of crypto uncertainty.
It’s the reason many investors treat digital currencies as a speculative asset class, one that might be used for gaining huge trading profits in a short period of time but might also lead to catastrophic losses for traders who aren’t careful.
Stablecoins , non-volatile cryptocurrencies whose value is tied to a fiat currency such as the US dollar on a 1:1 ratio, are a key solution for crypto volatility because they allow traders to shift portions of their holdings into a cryptocurrency that’s immune to price changes.
Non-Custodial Crypto Storage Over Third-Party Fiat Custodians Large amounts of fiat currency are usually stored in banks, but users often overlook the fact that when their money is kept in a bank, they don’t really have control over it.Even worse, users can’t exercise ownership over their funds freely when they are stored in a bank because it’s the bank that decides how, when, and how much of your assets you can withdraw or transfer to a third party as payment.If a bank gets robbed or goes broke, you might be compensated to a certain degree, or you might even end up losing all of your stored funds.
This is where crypto wins another huge advantage over fiat currency and TradFi, along with the huge draw of superior privacy.Crypto users can store their assets in a non-custodial crypto storage solution that lets them keep their private keys on their devices.Assets are constantly available for users to do as they see fit, and there’s no limit or inconvenient wait time to make things happen.
This is exactly what Zelcore enables users to do, giving them true ownership of their money and their private keys, which are always theirs to control.
Conclusion Crypto’s main drawback is the unpredictability of the highly volatile market, which causes hesitation among new users (and even seasoned ones).By leveraging the power of stablecoins and investing only in projects that have true development potential — and proven results — is a way users can compensate for the market’s volatility and protect their assets.
This is why users need the highly functional and reliable, multi-currency Zelcore wallet, that enables them to store and manage their whole portfolio of assets, quickly exchange cryptos, and keep their private keys and personal information to themselves..