Why The World Is Embracing Digital Currency – Elofusim

Peter Elofusim is the managing director of foreign portfolio investment advisory firm, TSP Capital Ltd. He is a passionate advocate of the adoption of crypto currency. In this interview with NKECHI ISAAC, he highlights the opportunities available in adopting crypto currencies, saying the world is drifting to digital currency because of its relative stability in value storage.

How would you describe money as a means of storing value?

Money as a means of exchange has been evolving way back. It is as old as man. We started from trade by barter and moved to coins and cowries and to paper money. The present money we have now is plastic money, which is ATM cards but the thing about it is that there is what businesses and individuals are looking for which money in its present form does not have. In economics we are told that money is a store of value but the truth about it is that money stores value at the point of exchange, at the point of conversion of goods into money but as days go by the value is lost due to depreciation and devaluation. So, a lot of things affect money as we know it.
Today, the present state of money is called fiat money. The thing about fiat money is that though it is a store of value, it fails to maintain that storage of value over a period of time. Every fiat money is subject to socio-political events, any negative socio-political events in a country affects value of stored money. Socio-political happenings affect the value of money; body language of the leaders of the country affects the money. So, essentially what I am saying is that a leader or top echelon of an administration can make a careless statement that could possibly affect the value of money.
This aggregates into a substantial form over a period of time. This simply means that money in its present form does not provide a safe haven to store wealth, assets. However, digital money allows for a relative stability in the storage of value. Also, any money that does not have finite amount, that can be printed like fiat money cannot have a strong value, it does not provide a relative stability in storage of value. These are the banes of fiat money.
So, what will you say is the answer to this? How can people and businesses store money and ensure its value does not depreciate?
It is in answer to this that made business to be looking for what can be used as a means of storing wealth and assets that you can go to bed and wake up and know that the value remains stable or at best improved or increased. This is what led to the emergence of digital currency or crypto currency.
In 2008, the financial crisis in America was at its worst point. In fact, you can say that money failed in America in 2008. It was at that point that Satoshi Nakamoto came up with the idea of digital money, so the first digital money, BITCOIN, was finally invented in 2009. It was invented at the time when the US dollar which was the world’s reserved currency failed everybody in the world. At the initial stage Bitcoin can only be acquired by solving a set of mathematical equations that were running on digital algorithms.
Those digital coins were exchanging for one Bitcoin for 10 cents. Now from 2009 to 2012 the value of Bitcoin moved from 10 cents per coin to $1,200. What this essentially meant is that people that invested in Bitcoin led to the emergence of so many millionaires in USD.
Why should people invest in crypto currency?
The reason the Bitcoin came into existence and has stayed till today, why the world should go for digital currency is that crypto currency is the form of currency that is not affected by socio- political events.  It is finite, meaning that the technology which is called Blockchain which controls and creates digital or crypto currency can only produce a finite amount of coins meaning that once that technology is in place nobody can just wake up and print more. So that already effectively imposes on it a finite amount of supply. That is why if you store your wealth in crypto currency you’re sure that it is not going to face devaluation as a result of printing of more currencies.
Another reason why it is the best way to store your wealth and assets is that it is not controlled by any government or money regulatory institution. The only thing that affects the digital currencies is the demand and supply which anyway affects the fiat money, and of course usability. If you store an asset in digital money you can go to bed and sleep and be rest assured that it will keep appreciating.
If digital currency is not controlled by financial regulatory institutions, what role will banks play in it?
This may sound too far-fetched but banks will close shops in the next 10 to 15 years if they fail to key into the scheme. This is because individuals and businesses are looking for transactions that do not impose any charges on transactions, and are more so instant. Presently, international transactions are not instant, but when it is digital money if I make payment to a vendor it is received immediately.
Also, digital money seeks to take away the middle man by making you your own banker. So, as a result there are no extra charges connected to transactions. If you look all over the world you will discover that governments are beginning to scramble to conform to digital or crypto currency. I am glad that I heard the NDIC MD recently say that FG had set up a committee to study crypto currency and how to adopt it. Senegal has already adopted this technology.
Is Bitcoin the only form of digital currency?
Now there are many digital monies, it is not only one. There are Litecoin and Onecoin. They are universal currencies that are not controlled by any government or central bank. But we are promoting Onecoin because Bitcoin was created on an experimental level because it didn’t put certain measures in place to make sure it stood the test of time. It was created experimentally and the inventor lost control when it became a success. When Bitcoin was created the issue of Know Your Customer (KYC) was not put in place. There were no tracking instruments to know who used the currency for transactions so it was abused. This gave Bitcoin a negative vibe but it was taken care of in later years. Another drawback for Bitcoin was that it was restricted to technological, science and mathematical savvy individuals or science nerds.
Onecoin has put in place measures to mitigate the shortcomings of Bitcoin. First of all, the KYC, from day one before you can acquire Onecoin, you must first of all fill out the KYC and supply your biodata. Unlike Bitcoin, in Onceoin everybody enters their mining pool so you don’t need to be technology or IT savvy. Onecoin is at the initial stage of creation and it will go public around 2018 so the opportunity to recreate the kind of wealth that was witnessed in Bitcoin exists in Onecoin.
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