Cryptocurrency is a type of digital currency that functions as a means of exchange, much like traditional money. Bitcoin is one of the most well-known cryptocurrencies, and what sets it apart is its blockchain technology, which has a variety of uses that promote global connectivity.

Blockchain technology creates a digital ledger system that tracks sales, digital use, and payments for wireless users. This data is compiled into blocks, which are then linked to the previous block once the current one is full, thus generating a blockchain of the data.

When linked together, these blocks create a time-stamped, unalterable timeline of data from the instant it was added. The digital ledger cannot be modified, deleted, or destroyed.

Currently, the most significant users of blockchain technology are cryptocurrency, decentralized finance (Defi), non-fungible tokens (NFTs), and smart contracts. If you are unfamiliar with cryptocurrency and how it operates, you can check out my article on **Cryptocurrency Investing Potential.

The Most Common Blockchain Uses

Cryptocurrency mining and purchases are done through peer-to-peer interaction (from your computer to mine), with blockchain technology recording each transaction as it occurs, creating a transaction history that cannot be tampered with, hacked, or deleted.

Defi (decentralized finance) is a worldwide alternative to our current financing system that eliminates the need for banks and brokerages. Blockchain technology enables individuals to conduct business with software as the middleman, rather than relying on a traditional bank or lending institution.

Defi is a term for financial services that use blockchain technology, mainly Ethereum. Anything you can do at a bank can be done this way. You can borrow money, lend money, purchase insurance, and trade assets, all while earning interest through blockchain.

Defi is quicker, eliminates paperwork and third-party institutions, and is done between individuals using a pseudonym (a created name), available to anyone with internet access.

Defi is currently used for “flash loans,” which are instantly obtainable short-term loans that require no paperwork or documents. It is used globally, allowing you to conduct financial business with anyone, anywhere, at any time. Additionally, it is used for crypto-based savings, earning much better interest rates than a traditional bank savings account. Its use in buying derivatives (two-party contracts whose value is based on an underlying asset) is combined with smart contracts that share blockchain technology.

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Pros and Cons of Decentralized Finance


Decentralized Finance (Defi) allows you to create a digital wallet that serves as your account, without the need for personal information. This protects your privacy and ensures that your data stays confidential. Defi also gives you full control over your assets, allowing you to move them whenever and however you want. Interest rates and rewards are updated quickly and are generally higher than those offered by stock exchanges. Transactions are transparent and visible to both parties, which is something that traditional banks and lending institutions do not offer.


Active trading in Ethereum blockchain can be expensive due to the fluctuations in transaction rates. Decentralized apps (dapps) used by Defi software can also create high volatility for your interest, depending on how and what dapps are used. It is important to keep records for tax purposes, and regulations may vary depending on where you live.

Non-Fungible Tokens (NFTs)

Non-fungible tokens are crypto assets, with each token being one-of-a-kind. Tokens can represent digital assets for anything from real estate to artwork. These can be used to trade, buy and sell tangible assets to reduce possible fraud. NFTs are used to identify you and your property (or your right to the property). Non-fungible tokens like Defi eliminate the middleman and scammers. At the same time, allowing collectors, buyers, and sellers a simplified transaction.

Currently, non-fungible tokens are used primarily by collectors of rare items, sports cards, and artwork. The value of each token is unique to the asset (unlike Bitcoin, where each coin has the same value); you can combine two NFTs and create a third unique NFT.

The benefit of non-fungible tokens comes from quickly turning a physical asset into a digital asset, eliminating the middleman, paperwork, and its ability to connect buyer to seller. For the collector, it creates provenance (a way to authenticate the collectible) and allows the item to be tracked starting with production through the final purchase.

Smart Contracts

A smart contract between buyer and seller is written in digital code using a decentralized blockchain network. The code controls how the contract is executed, with all transactions being permanent, non-reversible, and tracked. As with all blockchain-based technology, there is no go-between and your privacy is protected.

Despite the irreversibility of a smart contract, it is transparent and can be traced. Its traceability lets people see you own the house on Third Street, identifying you as the owner. Smart contracts allow securities/derivatives and their complex terms into a standard contract, decreasing the transaction cost because they are digitally analyzed during the contract’s creation.

The biggest boon to cryptocurrency has been the global connectivity it created. It allows entrepreneurs and investors in smaller nations international access. They can take advantage of markets that were never before available to them. Blockchain technology builds trust in transactions along with maintaining their safety.

Users in developing nations who do not have a bank account are taking advantage of this technology, creating a digital wallet to conduct their transactions. It connects people in different countries on a level never been used before. It is a fantastic connection that will only strengthen as blockchain technology improves.

Global Protection through Blockchain Technology

Cryptocurrencies blockchain technology is creating global transparency and accountability to its worldwide users. As more banks begin to use blockchain technology, the need for a central bank to monitor transactions will disappear.

Transactions stored in blockchain are there for all to see; a company’s risk distribution and liquidity will be transparent. It will offer insight into how the bank works and its behavior. The use of blockchain could have eliminated the 2008 banking crisis in the US, making the banking businesses’ behaviors transparent, and measures could have been taken to avert the crisis.

Globally, blockchain is improving the payment process. Its use by Western Union and companies like it has made it less expensive and much safer to send money to families all around the globe. In addition, payments using cryptocurrency only require an internet connection and are completed in minutes.

Global merchants save on credit card fees and receive payments quickly in blockchain transactions. It alleviates high costs, speeds up processing time, and makes it harder for the money to be intercepted and stolen

Blockchain Use in Banking and Investing

Worldwide, financial institutions started incorporating blockchain technology; in 2018, the Commonwealth Bank of Australia created an i-bond, a “blockchain operated debt instrument.” It was the first global bond to use blockchain ledger technology to allocate, transfer and manage the fund until its maturity two years later.

The Commonwealth Bank of Australia had researched blockchain for a year before creating the i-bond. In 2019, they added to their existing platform using blockchain technology to create a secondary tranche, a slice or portion of a pool of securities (frequently mortgage-backed securities sold as an investment and asset-backed securities.)

There is currently seven digital ledger (blockchain) trends in finance, smart contracts, non-fungible tokens, and decentralized finance make up the first three, with Initial coin offerings, asset-backed tokens, Robo-advisory services, and central bank digital currencies being the last four.

Initial Coin Offerings (ICOs)

An ICOS is an initial public offering by a start-up attempting to raise monies by selling a new cryptocurrency. The company hopes that the cryptocurrency will increase in value. Investment returns are based on the company’s financial performance.

Companies create their cryptocurrency offerings and directly sell the coins to investors. As a result, the coin’s value is related to the company platform offering the ICOS. These coins are a risky investment unless the company’s value rises or the company’s popularity increases.

Not all aspects of the technical details in these transactions are available for examination, making them a bit more suspect. Yet, companies like Singapore’s Based on Blockchain have stated publically that their goal is to make “ICOS more trustworthy, reliable and profitable for all industry participants.”

Asset-Backed Tokens

Asset-backed tokens are backed by a non-cryptocurrency value source (the opposite of an ICOS, which is backed by the value as a traded cryptocurrency.) Asset-backed tokens break down into four categories:

  • Security tokens denote the actual shares of stock in a business or similar type of asset.
  • Real estate tokens denote a physical property such as a plot of land or a building with the token equal to the property’s value.
  • Stablecoins are backed by assets such as fiat currencies (a government-issued currency using gold or silver as its asset) or another investment offering stability.
  • Utility tokens are used by companies to raise capital; an airline token will ensure an airplane seat at a specific price. Utility tokens are the newest token in this asset class; their use is only good for the company that issued them. For example, you can’t use a United Airlines token for a seat on a Delta plane.

All four asset tokens use blockchain technology and offer a level of liquidity, transparency and are traceable through a digital ledger.

Robo-Advisory Services

Robo-advisory services are automated financial guidance using an algorithm (AI) driven by analytics; the algorithm watches the markets and suggests when to buy and sell investments. It also manages your portfolio and makes investments through your portfolio. The majority of these are developed in the US and China. Since this trend is relatively new, there is no stand-out in this area. Though, I find it interesting that China is developing this technology given their ban on cryptocurrency in 2013 and their increased restrictions on cryptocurrency three years later.

Central Bank Digital Currencies (CBDC)

These currencies created by central banks are being developed worldwide. Sweden, China, Hong Kong, and Thailand are working on digital currencies to be used for cross-border payments.

In July, the European Central Bank announced a digital euro project they will be working on over the next two years that evolves from four possible business models. Even Google is exploring the introduction of a digital currency.

How the Blockchain Affects Our Everyday Lives

Decentralized social media platforms such as and Social X use blockchain encryption to keep your interactions and user information safe. It also ensures your right to uncensored expression of opinions, relieving any fear of retaliation.

Personal digital record security offers safe storage in an encrypted code on a blockchain, letting you store records such as birth and death certificates, deeds, and financial records.

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Healthcare uses blockchain technology to ensure HIPAA (health insurance portability and accountability) compliance to protect records, insurance claim processing, protect against data theft, and to create patient portals (an online portal where you or an authorized user appointed by you can access your medication prescriptions, lab results and procedure results, like an x-ray report.)

Travel and Hotel blockchain lets you book a flight, do a pre-flight check-in, and often precheck luggage, decreasing travel stress. Likewise, hotels allow you to book reservations and upgrade your accommodations. The use of blockchain in both industries assures information privacy and convenience, frequently offering users discounts and rewards.

As the voter fraud issue is raised, blockchain seems to be the solution. In the 2020 US Presidential election, the first vote using blockchain technology was cast. The use of blockchain would eliminate voter fraud, allowing people to vote on public policy directly. It would undoubtedly eliminate lobbyists and some politicians; it would also eliminate recounting votes and save tax-payer money that can be put to better use.

Blockchain establishes ownership of property, including IP rights using smart contracts, proves provenance, tracking registration and distribution, can help to find stolen property. It lets you create a digital identity keeping your personal information safe, and allows companies (you don’t have to share information with) to keep their data free of data breaches and fraud.

The Future of Blockchain Technology

The future of blockchain will be tied to user trust in the technology as they see the proof of information privacy and safety. As users see that encrypted information can be added, and how they can audit this information and establish transparency.

When people use blockchain-based services like banking, smart contracts, etc., they will realize the efficiency and time savings offered with this technology. The significance of this technology will be more apparent as more users learn to use it to their benefit.

Decentralization will be one of the more complex concepts for some users to understand. The idea that the more computers that use the network, the better the network will be maintained will undoubtedly need explaining for technology-challenged individuals.

As blockchain increases in each sector, the need for trained blockchain experts will increase. Ensuring there are enough experts to satisfy the demand may be an added challenge.

Final Thoughts on Blockchain Technology

Blockchain technology need not be feared; as with everything else in this everchanging world, time and education can prepare you for the next step in global connectivity. But, of course, it will take getting used to as all new things do.

Blockchain will change all aspects of our lives, from purchasing a house or a car to sharing medical information with medical professionals. It will improve and enhance aspects of our lives we have not realized needed improvement!

As the use of cryptocurrencies increase and new cryptocurrencies evolve (and they will in great numbers,) blockchain will grow to accommodate the changes and ensure its digital ledger remains a safe, transparent space.

Digital ledgers will eliminate the need to reconcile your books, a timesaver for all entrepreneurs and businesses. Used as a central file for your customers, blockchain will store all the information (credit ratings, company-required information, and notes you make) on your clients and customers in one place, allowing quick and easy access.

Security and time-stamping are the most encouraging reasons to embrace blockchain technology. Having your ownership and asset connected in the one place it will count the most, with just a stroke of the keys and the latest technology, is an excellent step in digital technology. Imagine life without the worry of being hacked or having to reclaim your identity; that is a future in technology that I can embrace!

While governments learn and regulate the newest technology, only those who effectively use it will become the leaders in blockchain technology, attracting global users from banking to investments in the latest blockchain technology.