Currency in the Digital WorldJuly 12th, 2013 | Articles, Job Search | No Comments »
Will there come a time when all forms of physical currency become so archaic that they fade away? At the rate that the IT world moves technology in new directions it seems that this is a definitive yes, leaving only the more pertinent question of “when will it happen” to be asked.
Consumers in America have already latched on to credit and debit cards. At the same time ecommerce companies like PayPal, which generated $5.6 billion dollars of revenue in 2012, are becoming the standard payment option for transactions. When you combine the average consumer’s penchant for quick, easy, and paperless transactions, globalization in the marketplace, and the decline in location stores like Best Buy and Barnes & Noble you get a hefty demand for non-physical forms of payment. As online retailers like Amazon pick up steam and crush their competition it will only be a matter of time before the majority of retail shopping is conducted online.
As of 2011, 609.8 million credit cards were held by US consumers, which averages out to about 3.5 cards per person. Additionally, 80% of people own a debit card, a trend that has become more common with age. Only 47% of people over 65 have and use debit cards, but it is certain that we will be hard pressed to find many consumers in the next generation that do not heavily utilize bank cards.
Visa held a debit purchase volume $1.15 trillion in 2011, and The Survey of Consumer Payment Choice in 2010 showed that more people use their debit cards to purchase items than cash. We have entered a period of time where, thanks to credit and debit cards, it is quite possible to go about life without ever handling a monetary note or coin. Even small businesses can use iPhone or iPad apps to swipe credit and debit cards. The physical representation of money is on its way to becoming as obsolete as commodity money (gold and other precious metals) became after the Gold Standard was rescinded.
The future of currency
Since their introduction in 2009, Bitcoins, the newcomers to the field of digital currency, have picked up steam in the marketplace as people begin to eye different forms of digital currency. Although bitcoins are not flawless they still remains the leader in internet currency. The coins are sold as a safe and secure way to make domestic and international exchanges, and are touted to be able to survive no matter what is occurring in the volatile global marketplace.
The Winklevoss twins, famous for their role in the creation of Mark Zuckerberg’s Facebook, have already amassed more than $11 million dollars in Bitcoins and placed them in trust of their own. They plan to start selling shares worth a fraction of each coin, effectively allowing people to invest in the digital currency with very little risk.
PayPal has also recently made news when the online ecommerce company announced that it will be shifting its focus towards inter-planetary payment systems, stating, “We won’t be using cash when we are in space.”
As private space companies eye a future in space tourism, PayPal is doing the same with space commerce, and hopes to make inter-planetary exchanges a reality in the near future.
As tech continues to advance and the Cloud expands, how long until all physical currency is stripped from the marketplace?
By Kevin Withers