Decentralization of the Digital Economy

Decentralization of the Digital Economy

The digital economy is defined as an economy that relies mainly on information technology, which means every stage of information manufacturing, from culture, training, and teaching, through the manufacture of physical computer parts and components, and then to the manufacture of computer software, or something computer-based, in one form or another.

What distinguishes these industries is that they depend mainly on human minds: the real cost lies in research and development, not in hardware and equipment (like in other industries) and the rest of these other things are more supportive than they are an activator, or a key engine.

The development process in the digital economy, which has emerged simultaneously, is supported by the emergence of the “electronic currency” or “digital currency” that promotes “decentralization”, the most important positive allusion to be addressed in this type of economy.

Given this digital world, where decentralization of financial transactions is the most important feature, it is possible to pay attention to these positive manifestations of decentralization, and to limit them to, for example, what might be called “instant free trading”, as the digital economy allows the transmission and reception of any amount of electronic currencies in real time, and from or to anywhere in the world, at any time, around the clock, without leave, without restrictions in overcoming them, and electronic currencies allow their users to control their finances completely. The implementation of transactions in electronic currencies is a matter of the digital economy, where such transactions have no fees – or, as is sometimes done, only with small fees, compared to the high cost of carrying out financial transactions through official financial and banking transfer networks. This is an important advantage in addition to the advantages of decentralization; we find them in the security and full control of transactions, where users of electronic currency have full control over their transactions, so it is impossible to charge them any undeclared fees compared to other traditional payment methods; digital currency transactions can also be concluded, without linking the personal information of the customers to transactions, and this provides superior protection and prevents the theft of identities; users of the digital currency can also protect their money through backup and encryption.

The digital economy provides the advantage of disclosure, transparency and the neutrality of all information about digital currency transactions, which is available in the block chain for anyone to use and document in real time, making it transparent and absolutely neutral for all customers; no one can control or manipulate the digital currency protocol, because it is secured through full encryption and encryption systems, which allows a great deal of reliability in the digital currency system to be transparent, and customers can completely predict via all its outputs.

On the other hand, there are disadvantages to the decentralization enjoyed by the digital economy, which should not be ignored, and can be monitored through extensive transactions in digital currencies. For example, there is a low degree of general acceptance, since digital currencies do not enjoy much general acceptance because many people are not familiar with the mechanisms of dealing with them, but they are increasingly being dealt with over time by continuing to spread digital economic awareness and culture. The value of transactions made in real money is still small, threatening the existence of the digital currency, which is still emerging, but the high probability of its disappearance is excluded as a result of the rapid technological development of both communications and information. The same applies to the secret nature of digital currencies, which are designed to allow their users to send and receive funds with a high degree of privacy, and although transactions can be verified, they prevent verification of the identity of their parties due to the existence of multiple techniques to protect the privacy of users, and other techniques are still under development. The digital currency, and some other countries, such as Thailand, impose restrictions on cryptocurrency transactions. And to talk the rest.

Author : Manahel Thabet
Published October 30, 2020
Al Bayan Newspaper

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