Slowly, cryptocurrencies are becoming mainstream. When the first cryptocurrency was launched back in 2009, people were very skeptic about it. Since then, Bitcoin has succeeded in having a market capitalization value of $143,506,539,558. This is not the only cryptocurrency that is operating in the market. Instead, there are various other digital currencies available as well.
As blockchain becomes mainstream, various industries are adopting it. This includes the automobile sector. The AutoBlock has delivered a cryptocurrency specifically for this industry, namely the AutoCoin.
If you are new to cryptocurrencies, you might wonder what the difference between Fiat currency and the AutoCoin is. Let’s first begin by defining the two.
What is fiat currency?
Dollars. Euros. Yen. These are all examples of fiat currency. Fiat money is any money that the government issues and regulates. Therefore, it is centrally regulated. The government and the central bank controls the money supply. This currency acts as a medium of transfer and a store of value. It is also dubbed as a “legal tender.” This means that you can legally use it to conduct transactions. There was a time when gold and other physical commodities backed fiat currency. However, in the world of credit, this is no longer the case.
What is the AutoCoin?
The AutoCoin is a cryptocurrency explicitly made for the automobile sector. You can only use it to buy and sell cars. To understand what it is, you must understand what a cryptocurrency is. In layman terms, you can view AutoCoin and all other cryptocurrencies as a virtual currency. You can use it to carry out transactions, yes. But, there is no tangible currency that you will have. Instead, it is all virtual. Unlike fiat currency which is centralized, cryptocurrencies are decentralized and work via the blockchain technology. This means that no one can alter their supply. Also, every transaction is stored in the system to ensure auditing and transparency.
The key differences
Fiat currency and the AutoCoin differ in the following aspects:
The most significant difference between the two is that fiat currencies are issued by the government who regulates it while cryptocurrencies have no central regulation. Any authority cannot influence their value and supply. Also, while fiat is considered a legal tender, this is not the case with the AutoCoin.
While you get access to physical currencies in case of fiat money, this is not the case with the AutoCoin or any other cryptocurrency. These are virtual coins. They are not available in physical shape. This actually is a benefit since it means you don’t need to carry bundles of notes whenever you want to conduct a transaction.
There is no upper limit to how much fiat currency can be in the world. This is because the government can issue more money whenever it wants to increase the money supply. They control the production of money.
However, this is not the case with the AutoCoin. Here, the supply is capped at a particular value. And there will only ever be the decided amount of digital currencies in the market. No one can choose to exceed this cap.
The AutoCoin can only be stored in digital wallets. This means that your money can always be prone to hacking since it is dependent on an online platform. On the contrary, there are various ways you can store your fiat currency. Whether it be putting it in a bank or saving it as hard currency, the chances of you losing money due to hacking in case of fiat currency as slim.
These are the critical differences between fiat currency and the AutoCoin. Decide whether you want to invest in AutoCoin or not.