7 Reasons why Bitcoins are Better Than Fiat Currencies

The global interest in bitcoins has recently increased. As a result, it’s critical to comprehend the foundations of this and all other types of virtual currencies. Bitcoin and its variants are all based on encrypted cryptographic techniques. It decentralizes the currency and gives the user ownership. These can be acquired at a Bitcoin ATM or through an online exchange. A bitcoin’s distinguishing feature reduces the risk of fraud and identity theft, making it a secure way to store money. Traders can use Bitcoins to buy and sell goods and services online and send money.

bitcoin coin on 100usd

Bitcoin is no longer a “future phenomenon” or the “next great thing.” It’s here, and it’s working hard to alter the global financial model that’s been in place for a century.

As you can see, the concept of money has taken several shapes throughout human history, beginning in its involvement in trade for ba. Humans have advanced from the early exchange of precious metals for goods and services to digitally transmitting money with just your gadget. It forms part of human civilization, especially the finance sector.

However, underlying rules determine what can and should be used as currency in a given country. Apples can’t be used as a form of payment, can they? (Though we should), it is missing vital fundamental aspects that are required to evaluate the value of an item.

For example, gold is a precious metal that meets these requirements. Modern currencies have been designed to match the paradigm to retain their worth. So, what about Bitcoin and other cryptocurrencies? Do they contain these qualities that make them valuable enough to be utilized as an effective form of payment?

What are fiat currencies, and how does it work?

Precious metals (like gold and silver) procure their value from their intrinsic value. Fiat money has value because the government declares it is declared legal currency; it has no inherent value.

What are cryptocurrencies?

Cryptocurrencies are digital assets that are utilized as a form of payment between two parties. They allow individuals to interact directly with one another without needing an intermediary, such as a bank. While fiat money is prone to inflation and central banks can create more at any time, Bitcoin, the most popular cryptocurrency, has a fixed quantity of 21.000.000 units, making it even more scarce than gold.

Is there a difference between cryptocurrencies and fiat money?

Cryptocurrencies are money in the sense that they allow two parties to exchange value and operate as a store of value. On the other hand, cryptocurrencies offer capabilities that the traditional money system currently lacks: they can be spent and received by anyone and at any t around the world, without the need for a bank or a government. Cryptocurrencies’ most innovative feature is this.

Furthermore, fiat money is essentially debt. When a central bank prints a banknote, it also issues a portion of your government’s obligation to you, the consumer.

Why is bitcoin valuable?

Since the cryptocurrency’s inception in 2008, the price of a single Bitcoin has risen dramatically, with significant ups and downs along the way. In April 2020, it hit an all-time high of over $60,000, and it has been oscillating ever since.

Bitcoin is a cryptocurrency that shares similar characteristics with existing currencies such as the US dollar and the Japanese yen as a store of value:

Limited quantity

Bitcoin’s total supply is limited to 21 million units. There will never be more than 21 million Bitcoins in circulation. According to many experts, Bitcoin’s value is based mainly on its restricted quantity or scarcity.


Because Bitcoin is based on a blockchain ledger, no hackers can replicate it. The blockchain records transactions and ensures that the system runs according to Satoshi Nakomoto’s original regulations.

Convenient to transport

Bitcoin is incredibly portable. Money’s simple to transfer from one exchange account or digital wallet to the next.


users can transfer bitcoin from one user to another or from one merchant to another. To transmit Bitcoin to someone, all you need is their public key (wallet address).

Bitcoin is the currency of the future

Now that we know what properties an ideal currency should have, it’s straightforward to examine how Bitcoin compares to fiat money and gold. Using gold as an example, we can see how Bitcoin is different from gold and far better.

Gold’s worth has been maintained over the centuries mainly due to the scarcity of precious metals.

Traders utilized them to accomplish a goal in ancient times. As previously stated, they were easily transportable, bendable into coins, had a long shelf life, and were superior to any other product.

These properties are no longer present in such metals. Apart from their long history as an essential component of the financial system, they are of little use to anyone today. They are not as easily transferable, long-lasting, divisible, secure, decentralized, and not as smart as other currency solutions.

In these areas, Bitcoin shines well. The cryptocurrency utilizes one of the most cutting-edge technologies, blockchain, to address these critical challenges.

Only 21 million Bitcoins will ever exist in the world, making it a scarce commodity. As a result, it preserves its relative worth in the same way as gold does. It is also safe, decentralized, and transactionally efficient. To summarize, Bitcoin has a function and does not exist in the financial system just due to historical traditions.

Consider this: Would you rely on gold or Bitcoin for transactions if you eliminated all fiat currency from the planet today?

Bitcoin has surpassed fiat currencies

Based on these and other variables, we can compare Bitcoin and cryptocurrencies in general to fiat currency.

Bitcoin’s supply is finite, whereas all other fiat currencies are printed regularly by the government. As a result, Bitcoin has a high value due to its increasing scarcity. For this reason, the value of one Bitcoin concerning multiple currencies skyrockets.

Of course, a steady supply of fiat currencies is necessary to avoid quantitative scarcity, but an excess supply leads to a decrease in their value, which leads to inflation. Part of this regular supply is used to compensate for currency notes that have been destroyed and are no longer usable. Bitcoin does not have this issue because it does not exist in a physical form.

Cryptocurrencies like Bitcoin are not only immensely more “durable” than fiat currency, but they are also safe. Bitcoin, for example, is based on a decentralized ledger system that is reviewed for accuracy many times on each ledger, implying that a transaction will only be allowed if all of the network’s systems approve it according to their records. As a result, the odds of counterfeiting bitcoin transactions are low.

Here are five reasons why Bitcoin is superior to fiat money:

1. Bitcoin is a Decentralized Currency

Bitcoin is well-known for being a decentralized currency. It means that if you want to do a transaction, you don’t need to go to a bank. The Bitcoin network will provide consumers with complete control over how they transmit money. Any government institutions or intermediaries will not monitor your Bitcoin transaction.

Bitcoin is a decentralized digital currency that monitors all transactions in a blockchain-distributed ledger. Bitcoin miners use elaborate computer rigs to solve complex problems to confirm groups of transactions known as blocks; if they can establish these blocks, they are added to the blockchain record. The miners are rewarded with small bitcoins. Other market participants can buy or sell tokens through cryptocurrency exchanges or peer-to-peer transactions.

Bitcoin is uncontrollable by any country’s central authority. The government has no power to regulate the purchase and sale of bitcoins. Any bitcoin user has the freedom to buy, sell, and hold bitcoins as they see fit.

The absence of banks and other central authority figures in the Bitcoin transaction process makes it the most appealing means of trade and makes it much faster and easier. Bitcoin allows anyone to send money, and it is also easier, faster, and less expensive than other currencies.

In the case of fiat currency, however, the reserve bank of that country has the right to make decisions about the sale, acquisition, and storage of that currency. As a result, if you have bitcoin, you can have greater transaction flexibility. You can use bitcoin anytime you want, according to your needs. When compared to fiat currency, bitcoin has fewer barriers.

2. A Better Investment Alternative

Due to the worldwide construction of trading platforms, exchanges, and online brokerages, Bitcoin is probably one of the most liquid investment assets. With incredibly cheap costs, you may trade bitcoin for cash or assets such as gold. If you’re searching for a quick profit, bitcoin’s high liquidity makes it an excellent investment option. Due to their tremendous market demand, digital currencies may also be a long-term investment.

In the Bitcoin market, there has always been a risk of volatility. There’s no guarantee that the volatility will subside any time soon. On the other hand, many professional investors remain optimistic that the market will continue to develop in the foreseeable future.

We’ve already discussed how traders might profit from the Bitcoin market by investing and taking advantage of price movements. As a trader, anyone can enter the market and make a profitable investment. You only need to know that you should buy it when it’s cheap and sell it when it’s more expensive. Compared to the FX (foreign exchange) or traditional currencies markets, you can get a better return on your investments here.

3. Borders are not a barrier:

Everyone can use Bitcoin anywhere in the world. You will not be required to convert the money to your country’s currency, as we do with fiat currencies, to complete a transaction. There are numerous online Bitcoin exchanges where you may instantly obtain your funds.

Cross-border transactions with constant value are not conceivable in fiat currency. However, it is possible in the case of bitcoin. Fiat money is only valid within their respective countries’ boundaries. Bitcoin is a cryptocurrency that allows for unrestricted currency movement. However, this is impossible in the case of fiat currency.

Bitcoin also provides consistency in terms of value, as it will be the same worldwide. The value, however, may fluctuate due to market conditions. Many factors can affect the price of Bitcoin, both positively and negatively.

Bitcoin can be used everywhere globally without restrictions or laws because Bitcoin is a decentralized currency with no government oversight. As opposed to fiat money, bitcoin offers more flexibility to the user.

4. Resistance against theft

For each bitcoin transaction, the bitcoin transaction system uses multifactor authentication. A credential for identity evidence, a sender’s private key for signing a transaction, and NAC’s private key for signing a transaction require this mandatory multifactor authentication.

Because transactions will require multifactor authentication, the security level for theft protection will be increased.

It is practically hard to steal Bitcoin unless someone has your private key. Each transaction’s data is recorded publicly as a block using blockchain technology. Some information is made public, but your data is kept confidential.

The blockchain will keep your Bitcoins in a digital wallet that only you have access to because you have the private key. Without question, Bitcoin is the safest currency on the planet. From a security standpoint, Bitcoin is far superior to traditional currencies, which have been the target of bank fraud and other forms of scams.

Some bitcoin websites require a coin holder’s private key to sign a transaction. A cryptocurrency user (for example, a Bitcoin user) can employ two-level verification to boost the wallet’s security level. Cryptocurrency users, on the other hand, are frequently hesitant to do so.

5. Transaction Costs

Bitcoin transactions are not subject to any fees imposed by banks. If you use fiat currency, however, you may be charged a transaction fee by the bank. It is why Bitcoin is not just a speedier but also a less expensive means to conduct transactions. At some Bitcoin exchange services, you may be forced to pay a tiny service fee, but that’s about it.

Using Bitcoin as a payment method is, without a doubt, simpler than using traditional currencies. If Bitcoin continues to develop at its current rate, it will attract a broader audience and eventually supplant fiat currencies. Remember that Bitcoin has been dubbed “the currency of the future.”

With the rise in the price of bitcoin, the amount transferred will rise as well. However, it will still be less expensive than fiat cash.

6. Falsification is impossible

Fraudsters are unable to create counterfeit bitcoin. It is because it is a digital currency instead of fiat money, which is a paper currency. Bitcoin is based on blockchain technology, which records the details of every transaction. In any case, you won’t be able to avoid it.

Anything you buy will be recorded in real-time using blockchain technology. Blockchain is a digital ledger of all bitcoin transactions because it possesses real-time monitoring of all actions. Every transaction is recorded accurately, and you can’t change it if you want to.

7. Seamless peer-to-peer transactions

Decentralized P2P networks make transactions more accessible, portable, and under the complete authority of their users in everyday life. When traveling to a country where the currency is different, one can transfer funds from their digital wallet to their preferred device. Users can transact or swap assets as they choose once assets are accessible via their mobile phone, desktop, or other digital wallets, for example, without the inconvenience of expensive currency swaps or lengthy banking transactions that take days to complete.

P2P networks, such as the Bitcoin Blockchain, are pretty inexpensive when it comes to pricey transactions. Compared to commercial banking, users can transfer any amount they choose with cheaper rates for large payments. Although fees on blockchain networks vary widely and can be costly at times, cases like this are uncommon but not unheard of and demonstrate the feasibility of transferring large sums using a peer-to-peer protocol.

Aside from the costs, the bureaucracy required in significant international transactions in commercial banking is notoriously burdensome, and there are several structural obstacles when remitting money overseas into various assets. With many digital asset rails available internationally, bitcoin’s blockchain relies solely on the independently verifiable permission of the parties involved.


As a result of the debate above, it is evident which elements of bitcoin are more advantageous than fiat money. It’s also possible that the entire planet will have a single currency with a fixed value in the coming years. The most exciting feature of this crypto coin is that it is rapidly becoming the world’s global currency, with numerous advantages. You cannot overlook the fact that bitcoin provides greater flexibility than other foreign currencies. It would help if you first learned everything about bitcoin before utilizing it. You cannot go wrong when dealing with bitcoins.
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