In the beginning of civilization people had no choice, but to adopt barter system in which goods, animals, commodities were the only means of exchange. For example if someone had a cow and he wanted to get some goats, then he had to search for someone who had surplus goats and was willing to dispose of them. So, for one cow he could have get two or three goats depending on their mutual agreement. So, barter system was a cumbersome way of exchange. It is not always possible to search a person who needs our thing and also willing to sell his things in exchange. Also, taking one thing from one place to another was a tedious job. So, trade and commerce could not flourish because of it.

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Later gold and silver coins became the means of exchange but, they were not easy to carry and also they used to get wear off with the time. Hence, paper notes came into existence. Now, we have digital money which is kept in our bank and we use it through debit-credit card, internet banking etc. Latest development is the cryptocurrencies. Digital money is something which is not kept in physical form. It is kept electronically. So, with a rapid pace we are adopting digital money and hard cash is becoming a thing of the past.

Digital money is easy to carry. We only need cards or smartphone to carry out all the transactions. So, no one can steel it from us and we don’t need safes in our homes to keep them safe from the burglars.

Limitations

However, digital money has its own demerits. It is kept in electronic form so any malware or hacker can hack all of our fortune and make us poor. It can fail easily due to some reasons like solar cycles, destruction of the electronic and electric system by the natural calamities, non-functioning of the system etc. In this condition we cannot use it and thus will be deprived of the money despite of having it in our accounts. Apart from it, world governments are becoming authoritarian day by day. If someone is against the government or if government thinks that some person is its enemy, then that person’s bank accounts can be frozen easily by the government and thus that person will be helpless against the system.

Hence, complete digitalization can be very harmful. So, we should have hard cash system as well in order to survive in dire situations. Money should be kept in a form of hard cash as well to cope with such unforeseen events.

Thank you!

Yours @akdx

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