Name Price24H (%)
Bitcoin (BTC)
Ethereum (ETH)
Litecoin (LTC)
Cryptocurrency, Featured

Why Growth of Cryptocurrencies Cannot Be Ignored?

There are several reasons behind the rise and growth of cryptocurrencies in recent years. The foremost reason is that many people are realizing the enormous benefits of decentralized finance. The growing discontent with centralized finance is one of the major factors. The discontent is largely due to recurrent inflation, financial exclusion by banks, and chronic economic problems. Against the backdrop of these problems, the growth of cryptocurrencies has been phenomenal. The revenue in the cryptocurrency market is projected to reach $51.5 billion in 2024. The annual growth rate is going to be around 8.62% and the average revenue per use will amount to $61.8 in 2024. 

Key Reasons behind the Growth of Cryptocurrencies

Cryptocurrencies such as Bitcoin, Ethereum, and many other altcoins are gaining legitimacy, popularity, and widespread acceptance. These are some of the major reasons behind the growth of these cryptos.

Widespread Adoption

In the last decade, cryptocurrencies have primarily grown due to widespread adoption. The total market capitalization has exceeded $2 trillion. Major multinational corporations are playing a vital role in this spectacular growth. Companies like Tesla, and Square are heavily investing in Bitcoin. Prominent asset management companies like Fidelity are integrating cryptos as a part of their investment strategy. 

Undeniable Advantages

Cryptocurrencies have many undeniable advantages over most traditional financial assets. For instance, cryptocurrencies have higher liquidity and can be traded 24/7 across different countries. The returns on investment are also significantly higher. Moreover, top cryptos such as Bitcoin are renowned for their hedge against inflation. Compared to other assets, the security systems of most exchange platforms are superior and faster because of blockchain technology’s transparency and traceability features.

Provides Credit Facilities

Cryptocurrencies have lower restrictions to entry and are useful in providing better credit facilities than. Crypto credit facilities can be bought and sold online by using a suitable platform. Therefore, it is useful for many people who live in those parts of the world where traditional banking facilities are inadequate. Cryptocurrencies can offer credit facilities through Maker DAO, Compound, and AAVE. These will help users to earn interest amounts for the crypto holdings. 

Approvals of Bitcoin ETF and Ethereum ETF

The recent ETF approvals of Bitcoin and Ethereum are a positive development in the cryptocurrency sector. The SEC has approved these which signifies that government agencies are no longer ignoring the tremendous potential of these coins. ETFs will help in better diversification of portfolios and facilitate more financial integration. 

Positive Impact of Blockchain Technology

The numerous benefits of blockchain technology are also contributing to the fast growth of cryptocurrencies. Features like decentralization, easy programmability, pseudonymous transactions, and the need to do away with financial intermediaries are having a cumulative positive impact on cryptocurrencies.

Also Read- Understanding The Concept of Crypto Airdrops

Bottom Line

The growth of cryptocurrencies in the last few years is an undeniable fact. It is also undeniable that cryptos being an integral part of decentralized finance (DeFi) offer unique advantages as a distinct asset class. Market growth and adoption are a testament to the fact that cryptocurrencies are profitable modes of investment. Shortly, there is a high possibility that cryptos may grow to the extent of challenging the monopoly of fiat currency in the world. 

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