What is the Future of Money? Can We Live Without it?

To understand the future of money, we must take a step back and understand the history of money. Before money, there was barter trade which was simply exchanging goods for goods. Barter trade had obvious challenges. For instance, it was hard dividing some goods or agreeing on how to measure the value of certain goods against other goods. Given such challenges, it is clear why money became more popular than barter trade.

Since the beginning of civilisation, the nature of money i.e. as a store of value and medium of exchange remained unchanged until 1944 when the Bretton Woods Conference took place. During this conference, many countries agreed to tie their currencies to the United States dollar as opposed to precious metals like gold and silver. When the United States withdrew from the gold standard (in 1971), all currencies became fiat money i.e. money which derives its value from the government that issues the money.

Fiat money has presented many problems over the decades. For instance, Fiat money can be controlled by governments via central banks when they increase or decrease supply. This has presented a huge problem paving way for digital currency. The biggest underlying issue with Fiat money is trust.

Digital currency

Digital currency aims to solve the problem of trust. Digital currency gets rid of intermediaries in the money chain i.e. the governments and banks. There is no central bank which can increase or decrease the supply of Bitcoins at will. Digital currency also introduces ”unforgettable” digital signatures which are distributed instantly and ubiquitously making the currency a perfect alternative to fiat money. Such digital currencies are known as cryptographic currencies.

A perfect example of cryptographic currency is Bitcoin. The currency is not only secure but works perfectly since payments are processed automatically. Bitcoin also works via a digital ledger which is widely distributed. Bitcoin also works extremely well in regards to storing value. Unlike fiat money which can be printed by governments against the best interests of citizens, Bitcoins can’t be printed into existence. They are acquired by solving complex mathematical problems through a process called mining.

Unlike fiat money supply, Bitcoin supply is also capped making it impossible for an inventor to create an unlimited number of Bitcoins. Ideally, cryptographic currency solves most problems faced by Fiat currencies today including trust issues introduced by governments and private banks. Cryptographic currencies are controlled by algorithms (instead of humans) hence their intuitive appeal.

Facilitating transactions

Since money is crucial for facilitating transactions, the future of money can be seen in the currency that is most likely to facilitate transactions of the future. As more transactions move online, Cryptographic currencies are expected to become increasingly popular. Bitcoin has been tested and proven to facilitate online transactions better than MasterCard and Visa in regards to cost and security.

As mentioned above, cryptographic currencies utilise widely distributed ledgers making them resistant to security attacks compared to centralised institutions like banks. Bitcoin transactions are also instantaneous so they attract lower fees. Moving forward, cryptographic currencies are the best suited for handling transactions in the future.

Democratisation of finance

Fiat money has centralised power into the hands of governments and central banks for a long time. The model appears to have worked well however, there are obvious drawbacks which are evident now more than ever. It’s clear than the fiat money system is controlled by a few bankers, the government, and regulators. As more people begin to discover the systemic challenges of regular currency, a revolution in financial world is eminent.
Cryptographic currencies will make finance more democratic by removing power from a select few and hand it over to the masses. Cryptographic currencies are highly decentralized making them more secure and functional compared to anything we have ever seen before. With payment systems like PayPal which make it very easy to accept electronic online payments, the future of money is in digital currency more so, cryptographic currencies.


Cryptographic currencies have setbacks to. For instance, Bitcoin has suffered from speculative bubbles proving it’s not the perfect currency for storing value. However, Gold has suffered the same setbacks so, currencies will always be vulnerable to speculation. With that said, digital currency is the future of money.

Is the Company Director of Swift Money Limited.
He oversees all day to day operations of the company and actively participates in providing information regarding the payday/short term loan industry.

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