Bitcoin’s value rises and plummets daily. The inconvenience Bitcoin would have on our commerce is intense and painful. Learn why.
The value of Bitcoin surged past $1,000 this week, the first time it has reached such heights since late 2013. But don’t let that big number fool you: this strange and controversial technology is no closer to becoming a mainstream currency. (Cade Metz, Wired.com, 01.06.17)
Banks in America produce money when the value of a dollar rises to keep its value consistent, while on the other hand, Bitcoin doesn’t try to keep its value consistent. Bitcoin can’t be used in commerce while it’s unstable, and the foreseeing future says it will continue to be unstable. Possibly, forever.
When prices fall, people put off buying things. And when people put off buying things, companies put off investing. And then the economy slumps—and keeps slumping. Even worse, people are stuck trying to pay back debts that don’t fall with wages that do. So bankruptcies pile up, and so do bank losses. That makes people too scared to borrow, and banks too scared to lend, which only makes prices fall even more. (Matthew O’Brien, The Atlantic)
Bitcoin needs banks across the globe to produce more coins when it’s value rises. Although this is great to fix the problem, the reason behind why Bitcoin is an investment value prevents this from becoming a reality.
Even if Bitcoin can sort out their financial issues, they still have another massive issue on their hand: American (including multiple other countries) finance laws.
If Bitcoin became mainstream and adopted as a substitute to American dollars, it will not be able to become anonymous any longer. Money laundering would be much too easy for the American government to deny allowing the currency as either mainstream, or to continue being anonymous.
Multiples of other laws would have to be instituted before it could be adopted entirely, anyways.
Bitcoin is slow, and takes lots of time to process purchases. Sometimes, the payments fail and aren’t processed correctly. What, are you going to wait ten minutes for your cup of coffee you bought with Bitcoin? Or are you going to reasonably hand the man your three dollars. It’s truly inconvenient.
Sources are also contained here.
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