Many people’s understanding of digital currency remains limited to impressions such as "having no intrinsic value" or being merely a "speculative tool." However, in reality, the concept of digital currency, first proposed before 1996 and developed to this day, has already had a tremendous impact on our society. Its influence can be summarized in two key aspects.
First, most intuitively, the development of digital currency has spurred the birth of blockchain technology.
The concept of digital currency was initially proposed by David Chaum in his 1985 paper, Security without identification: transaction systems to make big brother obsolete. After he outlined the idea of an untraceable cryptographic network payment system and digital currency, numerous cryptography geniuses began attempting to turn this concept into reality.
From 1990 to 2007, many digital currency payment systems emerged, including Adam Back’s HashCash, Wei Dai’s B-Money, and Nick Szabo’s Bit Gold. Although these projects failed, the core technologies of blockchain gradually crystallized during this developmental process. It wasn’t until the advent of Bitcoin in 2008 that a systematic blockchain technology was established.
Later, with the official launch of Ethereum in 2015, the infinite possibilities of blockchain were unveiled, and the technology was extended to various industries, leading to the current glory of blockchain. Therefore, without digital currency, the blockchain industry might still be quietly waiting in some obscure corner!
Beyond this, the second major impact of digital currency is its role in advancing financial payment systems in society.
Why is this the case? We should not underestimate the power of digital currency.
We all understand that cashless payments are inherently more advanced than cash payments. However, even in countries like ours, where cashless payment services are highly developed, it remains impossible to completely eliminate cash. Services like Alipay and WeChat Pay, which we commonly use, are more accurately described as "electronic cash," as they ultimately still rely on bank cash settlements.
Digital currency, however, operates differently. The essence of digital currency is information, and the speed of information transfer is inherently faster than cash settlement, especially in cross-border payments. For example, if we purchase an online service from the U.S. while in China, we would typically need a U.S. bank card. Even if not required, the payment would still need to be settled via the SWIFT international financial network, taking 2–5 days—a cumbersome process.
But if the website accepts digital currency payments, we can simply transfer the funds directly via digital currency. The underlying blockchain system automatically records the transaction, significantly reducing both time and cost compared to traditional payments, precisely because the nature of such transactions is information transfer. This is why many countries are now actively developing digital currencies—to enhance the internationalization of their own currencies.
Additionally, digital currencies make data tracking much easier, providing significant advantages in combating money laundering and preventing illegal transactions. These are tangible impacts brought about by digital currency.
In summary, digital currency is a product born from technological innovation. In its early stages, it may have been as faint as a spark, but as more people joined and time passed, it grew exponentially, ultimately feeding its power back into the world and driving it toward a brighter and more promising future.
