It’s completely fair to be on the fence regarding what you might feel about bitcoins. In some ways, it’s almost a revelation, something that has people scratching their heads and saying “Why didn’t we think about this before?”. It’s a means of trade and exchange that’s so blunt and simple in theory that it’s often being touted as the currency that’s ready to take the world by storm, and in some ways, it certainly did.
When it was first introduced, it sent shockwaves all across the world’s industries and economies, with many traditional financial players wondering if it was worth their time. It ballooned and deflated like the phases of the moon, which is understandable considering how the world of trading and exchange isn’t nearly as simple as the bitcoin itself. Therein lies its biggest issue.
Being universally compatible in a complicated market
One of the biggest drawbacks of bitcoin is the fact that it isn’t regulated by any bank or any government. It’s something that just about anyone can buy and sell, which gives it an undeniable charm. As more and more people decided to trade in it, however, it became increasingly clear just how unstable the bitcoin can be. For those who are still unsure or are confused about its history, there’s also a complete guide to bitcoin for anyone who happens to be interested.
The instability of bitcoin mainly lies in the different nuances of the world’s economy. While it might be seen as unsightly or incredibly inefficient, the economies of the world have a habit of stabilising despite everything going on. You would need to do something truly remarkable and extraordinary to rock the boat as far as the economies go, but the same can’t be said about bitcoin. For example, if someone were to hold a grand amount of bitcoin and not trade it, there will be a deficiency, enough to start a crisis. Because of how easy it is to use, it’s also very easy to destabilise.
Trying to keep bitcoin secure
This is another issue that has been plaguing those who have traded in bitcoin since its inception. The unfortunate fact is that bitcoin is one hundred percent digital. This means that it can and has been stolen by skilled hackers, which has resulted in an increased demand for digital security. Fortunately, the high-profile nature of bitcoin has resulted in many clever workarounds, such as the blockchain.
It basically acts as a digital ledger, allowing you to keep track of every single transaction made with bitcoin. It’s not something that can easily be hacked, but that doesn’t mean that it can’t be hacked. As more and more financial players are joining in and trying bitcoin for themselves, it’s highly likely that the security issues will be dealt with sooner rather than later. This will at least deal with one of the biggest and most pressing matters that bitcoin has, and what’s stopping it from living up to its full potential.
An ironic situation
In the beginning, many people were touting bitcoin as something of a fraud. In fact, one of the executives of JP Morgan Chase said that it amounted to nothing more than making a currency out of thin air and having people who purchase it think themselves smart. While this does seem rather silly, let’s not forget that this is exactly what central banks have been doing ever since the US was taken off of the gold standard way back in 1971.
This is what makes the situation with bitcoin so tricky; it’s bringing to the surface all of the most ridiculous (but true) accusations, without the accuser realising that this is exactly what is going on with traditional currencies in the world today. Eventually, the statement was retracted, which just goes to show what an ironic situation the bitcoin has found itself in.
A financial world divided
Due to bitcoin’s ability to change the status quo regarding how currency can and will be traded, it understandably has a few world powers worried about its current direction. You have the Chinese outright shutting down and banning bitcoin out of fear, because of its ability to effectively cut the middleman from the trading exchange process.
On the other hand, you have places like Canada and Finland who have begun to see just how much potential bitcoin has to help the markets grow, with the latter even planning to launch their own type of cryptocurrency. This kind of stark contrast between nations has left bitcoin in a bit of a strange state. It’s both universally loved and hated in equal measure, with more and more financial players deciding that perhaps bitcoin is worth their time, effort and money after all.
The current verdict
There are dozens of financial firms that are currently preparing to make use of cryptocurrency in one way or another, whether to enter the crypto markets by making use of bitcoin currencies that are currently moving around the markets or to make their own and make their mark on the crypto markets themselves. It’s a very interesting time for bitcoin, and there are many people out there who are saying that the world is currently on the cusp of a bitcoin revelation. As much as some parts of the world try to fight cryptocurrency, it’s only a matter of time before a mutual understanding is found regarding its benefits, and it will pave the way to a better and more fully realised worldwide market.
However, that isn’t necessarily what will happen. It’s almost just as likely for bitcoin to fall flat on its face once again as the markets begin to turn toward more traditional forms of currency and trade. It certainly isn’t the first time that it’s happened, but it’s interesting that bitcoin has never truly been down and out. Perhaps while it might not be this year, the bitcoin revelation might still happen in the near-future, and maybe its rise is completely unavoidable.