TECH EDUCATION

Advantages And Disadvantages Of Crypto Currency

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What Are Cryptocurrencies?

A Cryptocurrency is a digital-currency that can be used as a standard-currency where it is acceptable. However, Cryptocurrencies are not as stable compared to regular physical-currencies. Additionally, Cryptocurrencies are being used by people today for shopping online or money transactions. Lastly, digital-currencies use encrypted cryptographic technology and runs on blockchain technology. In fact, Bitcoin is the first cryptocurrency to come out and there are actually various websites that can allow you convert cryptocurrency to real money and transfer it directly to your bank account or vice-versa.

 

Advantages Of Cryptocurrency:

  1. Easy to access: Cryptocurrency is readily available for the general public. In fact, Cryptocurrencies feature a decentralized that allows people and investors from all over the world have easy access to them. For example, today there are several projects trying to raise funds through cryptocurrency.

 

  1. It’s very secure: Digital-currency is very secure because it uses blockchain-technology with a decentralized public ledger that displays every transaction made on a given token’s network. This makes tracking of individual coins thorough hence making it easy to track stolen coins. On top that, Hackers may also find a hard time attacking decentralized public ledger system compared to central hub systems. For example, Bitcoin can be backed up and encrypted to ensure the safety of your money.

 

  1. Quick and easy payments: Making payments using cryptocurrency is very easy and can be done in a few seconds. This is mainly because you don’t need to feed in many details or even enter credit/debit card details but all you need is an address of the wallet of the person or enterprise to which you wish to make the payment too.

 

  1. Provide users with total-control: Cryptocurrencies like Bitcoin allow users to be in control of their transactions and this actually facilitates for transactions on the network. In fact, you’re in control of your money with Bitcoin because there are no central authority figures within the Bitcoin network.

 

  1. Eliminate extra costs: with Cryptocurrencies, Merchants cannot charge extra fees on anything without being noticed. In fact, they must talk with the consumer before adding any extra-charges. Additionally, this Bitcoin you eliminate things like bank-charges and taxes on products/services being purchased.

 

  1. It protects people against identity-theft: With Bitcoin, payments can be made and finalized without any personal-information being tied to the transactions. This implies that your personal information is kept hidden from attackers hence eliminating identity-theft.

 

  1. Open the global-market to everyone: A digital-currency with universal acceptance can actually open the global-market to every possible participant thus allowing everyone to compete on an even playing ground. For example, Bitcoin it is very possible to send and get money anywhere in the world at any given time.

 

  1. Its Transparent: digital-currency is very transparent whereby all finalized transactions are available for everyone to see but with personal-information hidden. In fact, anyone at anytime can verify transactions in the Bitcoin block chain and the Bitcoin protocol cannot be manipulated by any person, organization or government because its cryptographically secure.

 

  1. It eliminates delays: Due to the technology Cryptocurrencies are based on, you don’t need to wait a couple of days for your business to receive the money because there are no third-parties in the transaction-process. In fact, with cryptocurrency transactions there are quick settlements because the peer-to-peer nature of the networking structure cuts-off the middleman.

 

  1. Improved Privacy: With Cryptocurrencies, you don’t need to share your identity, whereabouts or the details of the transactions made between you and the beneficiary. In fact, no information is required to be shared with the government or bank regarding the deal.

 

  1. No third parties: with Cryptocurrencies, you are the master of your money whereby you can keep it in your wallet and use it as per your wishes without involving third-party organizations like; banks.

 

  1. Lower Fees: crypto transactions may involve less money than those reliant on standard currencies. For example, a Bitcoin transaction requires only a Satoshi to process. Additionally, deals involving the use of American dollars must be worth at least $0.01 and this actually opens a broad range of micro-transactions that are just impossible to process with standard currencies.

 

  1. Fewer Risks for Merchants: with Cryptocurrencies like Bitcoin, transactions cannot be reversed, personal information is not carried with them and are even very secure. This actually helps to protect merchants from potential losses that might occur from fraud.

 

Disadvantages Of Cryptocurrency:

  • Difficult to understand: Crypto-currencies are new and come with a great learning-curve. For example, some people invest in digital-currency without acquiring proper knowledge and end-up losing money to something they did not learn about.

 

  • Its serves no practical-purpose: Bitcoin actually serves no practical purpose in a modern marketplace and has nothing underwriting its value and this implies that it can theoretically become utterly worthless in a day.

 

  • Risk and Volatile: Digital-currencies like Bitcoin are very volatile due to the fact that there is a limited amount of coins and the demand for them increases by each passing day. In fact, Bitcoin prices bounce everyday mainly because of the current events that are related to digital-currencies.

 

  • Wild price fluctuations: Digital-currency greatly fluctuates daily and that’s why most people fear buying them. In fact, fluctuations create a challenge for businesses to accept crypto-currency as a payment for goods and services because prices can vary dramatically by the hour.

 

  • Not accepted by most countries and companies: Most websites and companies don’t accept digital-currencies yet. Additionally, only a few countries have legalized the use of Cryptocurrencies. This is mainly because digital-currencies are impractical for everyday use.

 

  • It’s very easy to lose your wallet (money): If you have stored money in form of digital-currency on your phone or computer and then lose the device, you won’t be able to retrieve your money even with help of legal assistance. So, always try to backup your password somewhere in-order to avoid losing your money.

 

  • No reversing of payments: If you mistakenly pay someone by using digital-currency, then there is no way of getting a refund and all you can do is asking the person for a refund. But if the person turns down your request then you will lose the money.

Vanilla Farmer, Amazon Retailer & Tech Researcher. Yosaki is my personal blog but I'm working on some big tech project back doors. I will keep on posting various topics on things I have knowledge about.

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