Advantages and disadvantages of Bitcoin
Advantages of Bitcoin
freedom
At the point when BTC was made, the main thing was to guarantee the opportunity of clients. Such freedom was, first of all, ensuring that there was a centralized institution to control transactions, charge transaction fees, and take people’s money. In recent years, purchasing goods and services with cryptocurrency has become as easy and legal as purchasing with fiat currency. Moreover, considering the existence of numerous deep-web markets that do not accept payment methods other than Bitcoin, it can be said that purchasing items with BTC has become much easier than before.
high portability
One of the most important characteristics of money is portability. In other words, it should be comfortable to carry. Since Bitcoin is a 100% digital currency, you can conveniently carry any amount with a flash drive and store it online.
Cryptocurrency gives you the freedom to send and receive money simply by scanning a QR code or clicking on an online wallet. Such a transaction can be done in a matter of seconds, and there is no need to pay huge transaction fees like banks do, and transactions can be made directly from person to person without going through an intermediary process.
Freedom to freely set transaction fees
Another inescapable advantage of the Bitcoin network is that you can set your own transaction fees or choose not to pay any fees at all. Transaction fees are given to miners after the hash is successfully created and a new block is created. Usually the sender pays the full fee, but deducting this fee from the recipient may be considered an incomplete payment.
Transaction fees are voluntary and are given as a kind of incentive to miners so that certain transactions are included in newly formed blocks. This incentive is an important source of income for miners and allows them to earn much higher than traditional mining. Nonetheless, this is just impermanent as the measure of Bitcoin mining is restricted.
Therefore, the cryptocurrency market allows users to choose between cost and latency. A high transaction fee means that the processing time is short, so users without time constraints can save fees.
No PCI presence required
PCI stands for Payment Card Industry and includes prepaid cards, debit cards, e-purse, ATM and POS cards, plus all related providers. PCI encompasses all organizations that store, process, and transmit card user data, and strict security regulations apply. This includes all major credit card companies such as Visa and Mastercard.
From the perspective of large corporations, such uniform rules and regulations are desirable, but they are not made in consideration of everyone’s needs. There is no need to comply with the PCI standard when using Bitcoin, so it can be very useful for business expansion in markets that do not accept credit cards or are prone to fraudulent use of credit cards.
As a result, users can receive low fees, enter new markets where credit cards are difficult to accept, and reduce administrative costs related thereto.
high security
Bitcoin users can do all their transactions with peace of mind. This means that no one can withdraw money from my account and no one can steal my payment information from merchants unless I authorize them.
BTC users can also shield their capitals into backup copies and encryption technology. Their identity and personal information do not need to be disclosed at the time of payment, so it can be said that they are always protected.
High transparency and neutrality
On the blockchain, anyone can check and understand all transaction details and related information in real time. Since the BTC protocol is encrypted, no individual or institution can control or manipulate it. Since the network is decentralized, no one has complete control over it. That is why Bitcoin is always neutral, highly transparent and predictable.
Non-counterfeiting feature
The most common way to counterfeit in the digital world is to repeat the same transaction twice. This is called ‘twofold spend’, and to forestall this, digital currencies, for example, Bitcoin use different agreement instruments inborn in blockchain innovation and the BTC calculation.
Disadvantages of Bitcoin
Legal Status Issues
Bitcoin’s lawful status changes generally from one country to another. The use and trading of BTC is encouraged in some countries, while it is completely banned in others.
There has been considerable concern about the fact that Bitcoin appeals to criminals. Some media even argued that Bitcoin exists because it can be used to purchase illegal goods. In fact, the black market of the infamous Internet Silk Road was nothing that the Bitcoin price at the time would have been closed (Silk Road) plunge.
low awareness
Bitcoin is legally recognized in many countries, but some governments still do not even have regulations on BTC, and some countries have banned them altogether.
Moreover, most operators of all sizes do not even know about Bitcoin. It’s not going to happen when you’re just throwing away all other currencies and just sticking with Bitcoin.
Problem in case of key loss
Here, the key is a password that combines numbers and letters required to access the Bitcoin wallet . Losing the key has the same effect as losing the wallet. However, most wallet services provide backup and recovery mechanisms, but users have the inconvenience of having to set up first to use this mechanism.
high price volatility
Bitcoin price is notorious for its high volatility. Throughout its history, BTC has seen several spikes in price and then crashes in just a few days. As such, its value is unpredictable and the price fluctuates rapidly, causing considerable financial damage to unscrupulous investors.
continuous development
Bitcoin’s future is still uncertain. Currently, governments and banks do not control BTC. It is practically unregulated. In any case, as Bitcoin turns out to be progressively mainstream, governments all throughout the planet will need to present their own administrative components. Regulated and regulated Bitcoin would be a completely different kind of currency.
