What Are The Threats To Bitcoin

By  //  October 22, 2021

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There was a time when investing in bitcoin was thought to be buying a gold mine, which will make you very rich in the coming days. And this proved to be true also, as the investors of bitcoins enjoyed double profit after investing in it. But in January 2021,

Elon Musk, the famous Tesla owner, tweeted that his company will accept bitcoin from now on. And this boosted the price of bitcoin to its record height as bitcoin became equal to 65000 US dollars back then. Everyone started imagining bitcoin as the future currency until he tweeted again that he is no longer accepting bitcoin.

This tweet again decreased the value of bitcoin in half. It has again raised the debate in public. Is bitcoin worth this hype? Will investing in bitcoin pay us back according to our expectations? So, we will discuss threats related to bitcoin in this article. If you want to invest in bitcoin, then https://cryptotrader.software/ will guide you further. 

Regulation

Some countries have imposed a ban on cryptocurrency. China has ordered its businesses to stop accepting bitcoin instead of money, and it has decreased the market values of bitcoin and its worth. Same as China, the UK has also decided to ban all crypto exchange platforms.

These factors can be a threat to the future of bitcoin and maybe a reason for its decreasing worth. But the owner of a cryptocurrency exchange has stated that these countries should ban bitcoin. Because it has made it more decentralized, which is the primary cryptocurrency feature, but in the United States, over-regulation of digital currency could be disastrous. 

The regulation also affects in a way as the former US government decided that crypto users have to undergo an identity check before making transactions to stop money laundering.

One will also reduce the number of crypto users as they could not independently transact their money according to their will. If revealing their identity is the main thing, they can easily do a transaction using traditional currency. 

Volatility

The volatile nature of bitcoin can be known as its identity. One could be very profitable for people who have invested at the right time and sold it at the right time. There was a day when one bitcoin used to be equal to one dollar, and it reached its record height in January 2021, so it proved to be more profitable than any gold, silver, or jewels.

For example, if you had purchased bitcoin in December 2020, you could gain double profit in January 2021. But if you had purchased it in January 2021, then its price decreased to half.

It has turned you bankrupt for sure. People who have faced this loss will never invest in cryptocurrency and refrain from investing in bitcoin. One will become the reason for the lousy naming of bitcoin and will be a threat to its popularity.

Environmental Concerns

Many environmental authorities and bitcoin critics have shown concerns over the excessive use of energy by bitcoin as people who perform bitcoin mining have to spend a lot of electricity for this purpose. Loss of electricity and power for crypto mining has become a threat to the lack of resources in this world.

Fossil fuel and many nonrenewable resources have been in danger of running out any time soon. So, critics have claimed that One should reduce the excessive use of electricity during mining.

Elon Musk, the owner of TeslaTesla, once claimed that he would be accepting bitcoin as a payment method for his company, TeslaTesla, which increased the popularity of bitcoin and raised its price to its record height. But after a few times, he tweeted that he would not accept bitcoin anymore because of the excessive use of natural resources, so the popularity and the price of bitcoin also decreased.

Cryptocurrency and Cybercrimes

Bitcoin and other cryptocurrencies are at the continuous risk of getting hacked. As there is no proper storage, the hackers could run into someone’s iCloud or computer hardware and steal your security keys, then use them in transactions of their choice, and you will remain empty-handed.

Some criminals also use bitcoin for money laundering and other payment methods because they know no check and balance, and no one will demand their identity. That’s why some people are canceling bitcoin, which is the main reason for its decreasing prices and popularity.