What Determines the Monetary Worth of LIC?
The economic elements that influence the value or monetary worth of many things are demand and supply. For instance, the world’s leading cryptocurrency, bitcoin is not more than 21 million units; now, the planet is home to more than seven billion people. Assuming that one billion individuals adopt this cryptocurrency, 21 million units of bitcoin will reach a considerable price since part of the remaining six billion people on earth can still purchase it. The same applies to LIC with a limited offer of more than 60.8 million units – which would, given an increase in demand, will continue along its growth in value.
But the dynamics are not the same when it comes to legal tender or fiat currencies, i.e., the currency that the government has sanctioned as its official legal tender. The quantity of legal tender on the market is increasing daily. This is the primary difference between fiat money and a majority of the cryptocurrencies out there. Reproducible currencies are subject to devaluation as it depreciates in the long run. That is, the more currency units are pumped out there, the less rare and less precious – they become, thereby diminishing its symbolic value.
It is possible to keep $200 in a safe and then reach for it whenever you need it. Saving money is a smart move towards financial freedom. But the truth of the matter is that the $200 may not hold the same value a few years later as it may have lost some of its purchasing power as a result of inflation. When the circulation of fiat money is on the increase, the rarity also decreases as well.
This means the more banknotes in circulation, the less the value of individual bank notes, the purchasing power is also lessened considerably while prices of commodities increase in response to this effect. But such a scenario will never happen with any cryptocurrency, the quantity of which is drastically limited.
Back in the days before money was invented, the means of exchange used were physical goods such as silver or gold. But the legal medium of exchange, i.e., money is based solely on faith in the economy and credit. The only reason why fiat money has any value at all is that the government works hard to maintain that value or because two parties agree unanimously on such value.
So, this begs the question: how possible is it to lose faith in the currency – i.e., fiat money – of a nation? Nothing is impossible, and that means such a scenario could occur. Venezuela and Zimbabwe have proven that such an event could happen to judge by how their respective currencies have been rendered almost useless by high inflation.
What gives utmost value to any cryptocurrency is the immense trust that users place on it. People around the world based on the rules that govern supply and demand are responsible for determining the value of any currency or medium of exchange. Money – along with its interaction system must be accepted; the turning point, however, is that point where it becomes a substantial deposit of value or a resource via which individuals place their treasures.
The value of a cryptocurrency is given in two ways:
- On its payment network
- On currency requests
Every single day witnesses the transfers that are carried out via the network which places new cryptos into circulation and on the market. This happens through the verification of each transaction, thus affecting the value significantly. For every crypto coin issued on the market, some skilled users work tirelessly on their computers to inject more coins into the market.
The real value of this cryptocurrency lies in the network of the individuals that are participating. Technology is not responsible for creating wealth or fortune; it lies in the power of man to create wealth for themselves.
LIC is nothing but a symbol of value as well as a means of exchange. Its price, however, is based significantly on the virtual relationship between demand and supply of the cryptocurrency as well as on its usage. When people adopt LIC, they contribute to its rise in value when it is purchased as well as when it is used as a medium of exchange.
Therefore, take up LIC; begin to share and enjoy its growth in the world economy.