Cryptocurrency | Unfavorable Aspects of Bitcoin
Safety: is it really as safe as it seems?
Although the blockchain system is in principle known as a thoroughly secure system, it is of course questionable whether this is actually the case. The corresponding bitcoins must be stored in online or offline wallets. Fraud is possible with both. Nowadays everything can be hacked and you regularly hear stories about bitcoin theft and fraud with hardware wallets.
Governments want to curb it
One of the reasons cryptocurrency was developed is to minimize or even eliminate government intervention. Since the government earns a lot from things like taxes, and they have absolutely no control over cryptocurrencies, this is a reason for panic. An advantage is that it is not possible to restrict it completely, mainly because it is simply not easy and complete to trace. However, they can make it difficult by, for example, ensuring that regular currencies can no longer be converted into cryptocurrency or vice versa. As a result, entrepreneurs will not soon accept the crypto coin as a means of payment, as a result of which the entire basis of the bitcoin is gone. It is then purely an investment object based on supply and demand. But for example, you don’t have a bitcoin, you can still visit 우리카지노 to play reliable games and earn money!
It has been fixed from the very beginning of bitcoin: only 21 million of these digital coins are produced. However, the coin’s popularity is at an all-time high. As a result, the price is currently going up and down. This is of course nice to make profits in the short term, but this makes Bitcoin less suitable as a means of payment at the moment. After all, why spend your Bitcoins on a bicycle when you can buy a car for it a few days later.
Not guaranteed capital retention in case of problems
In the Netherlands, all banks have agreed that you will not lose your money if a bank goes bankrupt. That is when the deposit guarantee scheme comes into effect. This means that each customer gets up to €100,000 in savings back. All Dutch banks fall under this scheme, so you can save safely. However, Bitcoin is not regulated by any government. In fact, it is not regulated at all. Should something ever happen, for example, that the wallet you are using is “hacked” or somehow collapses, you will lose your money. There is no recourse from anyone except the party where you have deposited your money. However, there is a good chance that they will not give at home.
Transaction costs are getting higher
At the moment, the transaction costs of a bitcoin transaction are getting higher and higher. It is extremely busy on the network and this means that fees have to be paid so that transactions are executed (faster). The future of the Bitcoin transaction is very uncertain at the moment anyway. Now there is a reward waiting for people who make their computers available to validate transactions because bitcoins can still be mined. However, the question is who will validate bitcoin transactions when all bitcoins have been mined since in all likelihood there is no longer any reward attached to it.
Power consumption is insanely high
The computing power required to mine bitcoins and complete transactions is incredibly complex. This leads to insanely high power consumption. At the time of writing (Jan. 2018), the Bitcoin network is said to consume more power than the whole of the Netherlands. This means that in 2018 the network will probably account for 0.6% of the total energy consumption worldwide (!). This does not exactly make it an environmentally conscious and sustainable payment method.