According to various investors and analysts, the year 2008 was a year of the financial crisis and it demonstrated how gravely the overall financial situation of the whole world was facing challenges. It is also an implementation of what could happen if the world relied completely on existing financial institutions and bodies.
Cryptographers and scientists back then had already made certain plans and arrangements and came up with a form of currency that is completely digital. They were aware that to develop the ideas for digital cash they must introduce mechanisms and techniques that would prove to be extremely useful in the years ahead.
The modern-day cryptocurrencies of the market like Bitcoins were later developed through a series of events that paved the way for a change in financial transactions. Back in 2008 many supporters of blockchain technology believed that if that new technology had existed earlier, it could have helped in preventing the events of the financial crisis in 2008.
According to several studies and reports from the past few years of research, it has been found that several members who were a part of the cryptocurrency community believed that distributed ledger technology can help in preventing subsequent financial turmoil on a global scale.
Issues related to trust
According to some reputed journalists, trust can be considered a social resource for any company or even a country. There are several business enterprises and organizations in the world that have suffered when the trust of the public in them started breaking down.
These journalists had even mentioned in their reports that the issues that led to a financial crisis in the year 2008 were related to liquidity in a short term. This eventually led to a subprime mortgage crisis. Such a situation can be described as where the trust of the society was imperturbable on the financial institutions and their various record-keeping systems.
More people then started realizing that bankers working in such institutions might use different ways of manipulating and controlling the ledgers.
Blockchain and Bitcoins offer transparency
All the various reports and arguments had one major point that was the lack of transparency in the financial conditions and status of some of the biggest banks of the world. People around the world invest in these banks mainly due to their trust in them.
But the situation of the financial crisis in the year 2008 could change the viewpoint of people on the functioning of these banks. People now wanted a way of investing their money that would not just be trustable but also transparent in its functions.
This is the place the technology of blockchain came into existence to assist users. One of the major goals of blockchain has always been providing enough transparency so that financial crises can be avoided. The developers involved in this technology had made sure that the value of assets is secured along with their owners.
Blockchain came up with the idea of securely recording the various transactions in a shared ledger to make the process much more transparent and immutable than before. There was no place for any corrupt policies that were previously used by several financial institutions in order to hide their struggles.
Experts of blockchain technology had mentioned that transactions through Bitcoins can easily enhance and improve the flow of capital. A better flow of capital with the help of blockchain technology would prevent financial disaster in the future.
According to the supporters of Blockchain and Bitcoins, central banks would no longer be the individual banks responsible for reviewing their different operations and records of transactions. The shared transactions and their records allow the regulators or users to monitor the flow of their cash.
The technology of blockchain and Bitcoins can provide numerous other benefits to people in the modern world. These important blockchain features include protection from frauds and thefts. If you’re interested to know more click here to know more about the essential cryptocurrency tips for traders. Blockchain uses a unique method of storing data that is hack proof to a large extent. The scope of blockchain and the application of cryptocurrencies like Bitcoins are many.
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