Cryptocurrency and cash have been coexisting for several years now. But the question is, will crypto soon replace cash? Will, one day, fiat money cease to exist whilst crypto takes its place?

To discuss the possible answers to these questions, we first need to analyse the main difference and similarities between the two currencies. Next, we’ll look at the pros and cons of each. This will help us see how crypto stacks up against cash and whether it can replace this traditional currency. Let’s begin! 

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The Similarities Between Crypto and Cash

It’s important to identify the similarities between crypto and cash before discussing whether the former can replace the latter. 


The main similarity between cryptocurrency and cash is that they are both used in exchange for goods and services. Furthermore, both currencies act as a store of value and can be taxed by governments. 

Cryptocurrency can also be divisible in the same way that cash is. For example, we can divide a single Euro (€) into 100 cents and a single pound (£) into 100 pennies. Similarly, most cryptocurrencies can be divisible down eight decimal places or more (for instance, we can divide Bitcoin into 0.00000001 BTC). 

Additionally, despite cryptocurrency being a ‘digital currency,’ cash also exists in a digital form. In fact, according to the International Monetary Fund (IMF), less than 10% of the world’s money manifests in physical form. The other ~ 90% exists in digital records, which global banks control.  


Although it’s not common knowledge, consumers can access and withdraw crypto in the same way as cash. There are already thousands of Bitcoin ATMS that anyone can use to cash out Bitcoin and other crypto coins. Although they are more scarce, a Bitcoin ATM is very similar to a standard ATM that people use to take out money from their bank account. 

Crypto debit cards also exist and allow consumers to use crypto to make purchases online and at stores the same way they would with cash. There are also plenty of other ways that allow traders to sell Bitcoin and other crypto tokens, making this currency accessible similar to how traditional cash is. 


Finally, as we mention further in this article, since it’s a decentralised currency, cryptocurrency does not require the inclusion of intermediaries that fiat money does, such as banks. However, this doesn’t mean intermediaries and third parties don’t exist in the crypto industry. 

For instance, centralised exchanges (such as Binance) are also present, which traders use to buy, sell, and store crypto. Likewise, traders can collaborate with brokers through crypto platforms. In this way traders can receive much needed advice on how to improve their trading strategies and get the most out of their crypto journey. 

The Differences Between Crypto and Cash

Although, as we’ve established, there are a number of similarities between crypto and cash, there are far more differences between the two currencies. This discrepancy has opened up the discussion of whether crypto can compete against and even replace cash in the future.


The main difference between crypto and cash is that cryptocurrency is decentralised and not regulated by authorities or backed by governments. This makes cryptocurrency less credible than its counterpart but also provides more transparency and control for users. 

Additionally, regulating fiat money has led to more customer protection laws in place. This means customers can more easily recover lost funds or become compensated for issues resulting from using an illegitimate or insolvent company. Furthermore, due to the lack of crypto regulation, the industry is subject to scams and malicious activity. 


Another key difference between these two currencies is that cash depends on government backing, whilst crypto doesn’t. This means that government authorities determine the value and supply of cash. 

On the other hand, since it’s not regulated, cryptocurrency derives its value from other factors such as utility, demand, competition, and availability. This makes cryptocurrency less stable than cash, which is why it’s considered a highly volatile asset. The question of whether this volatility is a good or bad thing is still widely debated.


Whilst fiat money is printed and disturbed through banks and governments, cryptocurrency is created through a process known as mining. Afterwards, all distribution and transactions are recorded on a public blockchain that anyone can view. 

Currently, there are many more options for making transactions using fiat money since it’s the world’s most accepted currency. All stores worldwide accept their country’s local currency physically or through card transactions.

On the other hand, despite crypto becoming more accepted in recent years, it’s still not as widely accepted as cash. In most countries, crypto is not yet considered legal tender, so users are limited to using a Bitcoin ATM, exchange, broker, or debit card, to withdraw, buy, and sell crypto. 


Lastly, the main difference between these two currencies is that cash is often subject to inflation, whilst many consider crypto as inflation-resistant. Inflation refers to a significant price increase for goods and services over a set time period. As prices increase, the value of fiat currency will subsequently decrease, which in turn, decreases its purchasing power. 

Typically, cryptocurrency doesn’t suffer from inflation in the same way cash does. This is because most cryptocurrencies have a maximum supply cap. For example, Bitcoin has a supply cap of 21 million, meaning this is the maximum amount of BTC coins that will ever exist. This means that the supply of the currency will halt whilst demand will increase, making this and other crypto coins much more resistant to inflation than cash.  

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The Pros and Cons of Crypto

The crypto industry often receives praise for being innovative, private, and highly transparent. However, this digital currency has experienced significant criticism over the years. But is this praise and criticism justified? Let’s find out by looking at cryptocurrency’s main pros and cons! 


  • Protection from inflation  – We can consider crypto much more inflation-resistant than cash. As many cryptocurrencies, such as Bitcoin, have a maximum supply cap, demand will continue to rise whilst supply doesn’t. This offers much more protection against inflation compared to fiat currency. 
  • No need for intermediaries – Unlike fiat money, crypto transactions don’t require an intermediary such as a traditional bank. Although there are some intermediary options, such as a crypto exchange and a Bitcoin ATM, traders can choose to use peer-to-peer exchange platforms instead. Through peer-to-peer selling, traders can negotiate prices and trade crypto without any need for a third party. 
  • Highly transparent – This lack of intermediaries also contributes to the higher transparency of the crypto sector. Additionally, since crypto is decentralised, all traders can easily view and track transactions.
  • Lower transaction fees – Crypto is generally much more cost-effective than fiat currency. Traders can sell crypto or trade assets with each other from opposite sides of the world without incurring substantial fees that would occur if they made transactions through traditional institutions. 


  • Higher volatility – Cryptocurrency is infamously volatile, which means it’s common for traders to experience losses from their investments. Even established coins such as Bitcoin can rise or fall unexpectedly, and this instability can be off-putting for many. 
  • Not widely accepted – As crypto is not yet a widely accepted payment method in most parts of the world, it can be quite inconvenient for traders. However, there is still a range of options for traders to convert crypto into fiat money through Bitcoin ATMs, crypto debit cards, and other crypto cash-out methods. 
  • Difficult to use – Crypto is definitely not suitable for everyone, and purchasing crypto coins is generally much more difficult compared to buying cash. Research must be done before anyone can start investing in crypto coins, which can be a hindrance for some. 
  • Can damage the environment – The mining of Bitcoin and other cryptocurrencies is more environmentally damaging compared to the printing of cash. This is because crypto mining is highly energy-intensive and consumes a significant amount of electricity. 

The Pros and Cons of Cash 

We all have experience using cash, and most of us rarely encounter any issues first-hand. But, as much as we’re used to using cash, it’s definitely not perfect. Which areas of fiat money are lacking? Find out by checking out these main pros and cons of cash!


  • Highly stable – Cash is generally much more stable than crypto and doesn’t experience the same volatility as digital currencies do. This can be a relief for many, as we don’t have to consider the same risks that we would with crypto when creating a bank account or withdrawing cash. 
  • Easy to use – Compared to crypto, cash is extremely easy to use. By using a debit card or withdrawing from a bank account, anyone can instantly access their cash to make transactions. There are usually no extra obstacles to hurdle, either.
  • Widely accepted – Cash, of course, is the most prevalent currency in the world, making it highly convenient and accessible. There are tons of options for consumers to use cash, including money transfer apps, which make cash an accessible and user-friendly currency. 
  • More consumer protection laws – Since cash is highly regulated, there are more consumer protection laws in place that can help shield consumers from scams and malicious practices. Furthermore, these laws make it easier for consumers to recover funds, which is not the case for crypto. 


  • Chance of purchasing power decreases – As fiat money does not have a supply cap, it’s extremely vulnerable to inflation. Through unstable periods in an economy, the value of cash can plummet, which means citizens will need to pay more to receive a product than they would previously.
  • Need for intermediaries – Cash owners don’t have the same control over their money as crypto owners. With cash, an intermediary such as a bank will manage most transactions and decisions. This lack of control also makes cash much less transparent than cryptocurrency. 
  • Higher fees – With this inclusion of intermediaries, cash owners are usually subject to higher transaction fees compared to crypto owners. These fees can sustainably increase when making international transactions and even withdrawing money abroad. 
  • Vulnerable to theft and loss – As cash is typically physical, it’s susceptible to loss, theft, and damage. Additionally, cash is prone to counterfeiting and criminals who participate in money laundering widely use it. 

Final Thoughts – Will Crypto Replace Cash?  

Now that we understand both the similarities and differences between crypto and cash, as well as the pros and cons of each currency, we can discuss whether cryptocurrency could replace cash. 

It’s clear that crypto addresses key issues that arise from fiat money. For example, crypto transactions incur lower fees and are far more transparent compared to cash transactions. This can make crypto a cost-effective option that is free of corruption that could result from the inclusion of third parties. 

The lack of requirements for third parties and intermediaries also gives crypto owners a higher level of control when managing their funds. Additionally, since crypto is typically inflation-resistant, it can be a suitable alternative to cash in periods of economic instability. 

However, crypto is not perfect, and its key characteristics can also have a negative impact on consumers. For instance, the lack of regulation puts crypto owners more at risk of scams and has resulted in an increase in malicious business practices. Furthermore, crypto is not currently widely accepted, making it an inconvenient option for many. There is also a much steeper learning curve when it comes to buying and selling crypto than cash.

Overall, crypto has plenty of advantages compared to cash. Although, the currency still needs more time to integrate into our society and overcome its own obstacles. Over time, crypto may begin to replace cash, but as it stands, cash is holding its ground as the most popular and accessible form of currency. 

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