How Cryptocurrencies Benefit Consumers: Payments, Business Models, Security and ID Reporting
For many everyday individuals, cryptocurrencies may be ambiguous. However, there are actually a number of ways in which they benefit consumers that they are not aware of. Here are just a few qualities that make cryptocurrencies useful to the everyday individual.
Based on Push Payments
First, unlike traditional currencies, which are based on pull-payments, cryptocurrencies are push-based. A pull-based system is where the payment recipient notifies their financial institution that they want to pull funds from the payor’s account.
The payment is authorized with a credit card number. On the other hand, a push payment may be more beneficial and empowering to consumers. They person making the payment provides the recipients account information.
The recipient then initiates the transaction and the funds are pushed from the paying person’s account. A push payment system may be more secure, it may be able to protect data better, and retailers do not need to retain consumer information.
Cryptocurrencies Allow Micropayments
Second, cryptocurrencies allow for micropayments. Micropayments are small-value payments that do not need an intermediary. This type of payment system supports many different business models, which users can adopt for the benefit of their business. A few examples of micropayment systems in the cryptocurrency field include Satoshipay and Nano.
A benefit of using micropayment systems is that they allow for decentralized social media networks that can serve as an alternative to traditional options, like Facebook and Twitter.
The micropayment option can also mitigate the need for large upfront payments. Instead, users can make small payments per post, leading to a more decentralized social media option.
Promotes a More Decentralized System
Third, cryptocurrencies can also promote a more decentralized system. For example, blockchain networks decentralize sensitive data. When data is on the blockchain, it cannot be corrupted or modified. Therefore, it is better protected than it would be by other centralized systems, which can be prone to hacking.
Decentralized Credit Reporting
Finally, blockchain networks are also getting involved in decentralized credit and identity reporting. This way, users need not rely on traditional reporting companies, such as Equifax, TransUnion, and Experian, which may be vulnerable to attacks. One up-and-coming decentralized platform for credit and identity reporting is Bloom, which is based on the Ethereum blockchain network.
Ultimately, cryptocurrencies provide consumers with a number of beneficial qualities. With what cryptocurrencies have to offer, consumers may be better off in a number of ways.