As we all know, bitcoin is a popular cryptocurrency, and there are millions of users worldwide. There are billions of people who have mobile phones and internet access, and ten to twenty percent use bitcoin. There are 21 million bitcoins in circulation, and millions of transactions daily occur. I know that there are a lot of bitcoin benefits. That is why bitcoin is a popular cryptocurrency instead of other cryptocurrencies. Still, there are cons or disadvantages to bitcoin. So, in this article, we will discuss the disadvantages of bitcoin. So, without wasting time, let’s take a look at the negative side of bitcoin.
Bitcoin in brief:
Bitcoin is a popular first cryptocurrency to solve the problems of people. We use fiat currency for daily transactions, but there are some limitations of fiat currency, and then bitcoin came into existence. Bitcoin is a globally accepted currency in a digital form that no one can control since it is a decentralized currency. There are a lot of benefits of using bitcoin cryptocurrency such as decentralized system, no taxes, most secure currency, globally accepted payment gateway, business expansion is easy with bitcoin and many more benefits. Understand the bitcoin market for more details.
What are the disadvantages of bitcoin?
- Volatile: - Volatile means fluctuations in bitcoin price. When the price of bitcoin goes up and down in a few minutes, it is a volatile cryptocurrency. You know about bitcoin price fluctuation if you are already a bitcoin user, investor, or trader. Bitcoin is a decentralized system that means no one can control the price or changes. Therefore, it is riskier for bitcoin users, especially those who daily use bitcoin for transactions. For example, suppose you have a bitcoin worth $500, and you want to purchase something worth $500, and at the time of transferring, the value decreased, and $500 decreased to $450 that means you have transferred $450, and you have to transfer $50 more that means you lose $50. So high volatility is the most significant disadvantage of bitcoin.
- Illegal Activities: - This is the second most significant disadvantage of bitcoin. Bitcoin is a decentralized system that means third parties cannot control it, such as the government, banks, other financial institutions, and even the founder of bitcoin. Furthermore, the government cannot trace the bitcoin transactions because you can use multiple wallets of bitcoin, and your identity is anonymous on bitcoin. Unfortunately, after the launch of bitcoin (2008), many people started using bitcoin for illegal purposes, and in today’s era, people also use bitcoin for illicit purposes because it is not traceable.
- Riskier investment: - As we know, bitcoin is volatile in nature and uncertain. The price of bitcoin depends on demand and supply, and many more factors also influence the price. If you are investing in bitcoin, there is no guarantee it will go up or down in the future. Many people lose their money in trading because there is a low risk in investment but 120% high risk and high return. Many beginner traders lost all their money in bitcoin trading and committed suicide.
- Not widely accepted currency: - We always read that bitcoin is a globally accepted cryptocurrency, and anyone can use it all over the world. You can send and receive bitcoin from anyone worldwide. Still, many people in the world do not accept bitcoin and do not use or haven’t heard the name of bitcoin. In some cities or villages, people do not know about technology. They use cash for daily transactions because it is easy to use. Let us clear in the comment section if you are using or not using bitcoin payments. In some countries, bitcoin is because the government cannot control it. Bitcoin supports illegal activities indirectly, which is why some countries can’t use it.
- Wallet risk: - Wallet is a place to store your bitcoins digitally as you need a physical purse to keep your physical cash or coins. There are a lot of bitcoin wallets on the internet, such as web wallets or online wallets, offline wallets, mobile and desktop wallets, software, etc. Some exchanges provide bitcoin wallets inbuilt in their platform that are also too risky because once the exchange gets hacked, you will also lose all your bitcoins.