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3 reasons why some governments are restricting use of cryptocurrencies

5Many governments now want to control the use of cryptocurrencies. Though this type of payment system has become popular, it has led to several concerns among people. In USA, extensive inquiry is going on against bitcoin. Professionals from different fields are having regular meetings to discuss the impact of bitcoins. Here are three reasons why some governments don’t want the use of cryptocurrencies.

  • The government is thinking of proposing a regulatory framework for firms using virtual currency. If bitcoins are controlled with strict regulations, then the original essence of bitcoin is lost. It’s supposed to be decentralized. Most governments are used to imposing strict rules. Like the banks today have to verify customer accounts in detail before opening an account. They would like to impose similar regulations on bitcoin.
  • Bitcoins are open to hackers. Though measures are being taken, but there was a recent incident when customers lost a lot of money in bitcoins. So, the people’ money isn’t safe anymore.
  • Bitcoins make illegal businesses easier. Buying fire arms and drugs are much easy with bitcoins as this form of money is not traceable. Bitcoins can also be used for terrorist activities. Bitcoins have great potential for becoming the vehicle of money laundering.

All these are quite serious issues and the governments have all the reason to be doubtful about the practical use of bitcoins. The security of bitcoins may increase due to technological advancement in future; but it doesn’t make bitcoins 100% secured. The experts still need to work on the possibilities of making bitcoin a global currency.

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What will happen if bitcoin is accepted globally?

What would happen if bitcoin was accepted on a global scale? Will the situation be better than now? Or, will the society suffer? These questions always come up regarding the use of bitcoins. Lets look at the advantages of using bitcoin.

  • There won’t be any banks. So, there won’t be any need to open an account and go through all the formalities.
  • We will receive more financial freedom. Bitcoins will be stronger than our conventional currencies as there won’t be any currency fluctuations.
  • There will be only one type of currency that will be used in all countries throughout the world. So, transactions between countries will be much simpler.

Bitcoins also have some drawbacks. Here are the main setbacks of using bitcoin.

  • Security is a problem. Though experts are saying that it is fully secured, but you never know when a criminal activity may take place, like hacking.
  • With the introduction of bitcoins, other things like BitLincense have also come up in the USA and other places. There will be more similar businesses in future.
  • The acceptance of bitcoin as global currency means that an international law will be regulating it. So, every country in the world has to follow the same method of transactions.
  • Such regulations may cause people to go back using our conventional currency like dollar or yen, but they will be using it the same way they use bitcoin.

So, the debate is still in the middle of the pendulum. It will continue to be so until bitcoin is fully established as the new currency everywhere.

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3 reasons why bitcoin is revolutionary

Although some time has passed since bitcoin has been making headlines, still many people don’t  know why bitcoin is revolutionary. Some people say it’s an extraordinary invention, whereas others say it’s going to affect the society negatively. While the debate still continues, most experts have welcomed the concept of bitcoin. Here are main reasons why this new technology is so exciting.

Bitcoin is decentralized

Nobody controls bitcoin. Bitcoin is open for everyone to use. However, it cannot be changed by anybody. It is the open nature of bitcoin that makes it so promising and popular.

Bitcoins are scarce

The supply of currency is unpredictable. Sometimes it increases and sometimes it decreases. There won’t be more than 21 billion bitcoin ever! With money, you don’t know whether it is scarce. Even with gold, which is scarce and holds the greatest value, you cannot say the exact amount that’s going to be available. We only mine 2% of gold a year. But with bitcoin, there will not be any mining after 21 million bitcoin is exhausted. This makes bitcoin unique.

Bitcoin transactions are resistant to censorship

With money, if you have to send it to anyone, you have to do it through a bank or a third party. You also need to pay some transaction fee. But with bitcoin, you can send it to anyone anywhere in the world in real time without any fee.

These three features make bitcoin the best form of money till now. Experts think that bitcoin is going to change money the way Internet has changed information.