In the year 2009, Bitcoin came into the introduction and got recognition as the first asset known as cryptocurrency. This digital currency reduces the requirement of any third party, whether banks or other institutions. Bitcoin can be referred to as “BTC” as a symbol and regards to a computer file which is kept in the digital wallet on the user’s device. If you want to be familiar with the Bitcoin working process, you need to be familiar with certain terms, too, such as blockchain, bitcoin mining, public and private keys. Bitcoin is operated using a blockchain code, which results in a generated public ledger. The technology using which bitcoin operates is termed as blockchain technology. Bitcoin miners are the ones who are engaged in the platform of peer-to-peer technology. In each BTC wallet, there is one private and public key. Both the keys are useful to start the transactions and put signature in digital format. For more terms, you can easily rely on some sources such as bitcoin pro.
If you’re a beginner in the Bitcoin world, then you must be aware of some advantages or disadvantages linked with it. No doubt, Bitcoin regards to be a beneficial currency with lots of usage options. Still, it holds a few limitations, which makes it an unsuitable option for some investors. Using Bitcoin can be either beneficial for investors or turn into a limitation for others.
Advantages linked with Bitcoin
- Growth potential:
Many times, investors go with a trick to get benefits using Bitcoin. The investors who are buying Bitcoin and holding it assumes that the Bitcoin maturity stage is linked with high growth potential. Seeing the present usage of Bitcoin currency, investors consider that the currency is going to be used by more people in the future. This makes it a beneficial currency in terms of growth potential.
- No third-party requirement
While making any money transfers with the currency you use every day, you need to indulge a bank in making transfers from one account to another. It might mean that all your transactions are completed with an intermediary. What will you do if the bank’s service goes down and you need to transfer money urgently? Often, it is the time when Bitcoin won’t leave your hand. After the Great Recession period, investors are waiting to get an alternative solution. As a result, it can be a great idea to use a digital currency that is not involved in the regulatory bank or other party’s control.
- Low charges:
While performing any financial transaction, you need to pay fees to get the transaction completed. But this limitation is removed with the Bitcoin currency. It is one of the advantages which makes Bitcoin a preferable currency among several investors.
- Convenient transactions:
One of the most beneficial aspects linked with Bitcoin currency is the use of it. One can conveniently use the currency to make transactions digitally for paying or receiving payments.
Disadvantages linked with Bitcoin
- Volatile pricing:
In 2017, Bitcoin’s price attained a spike with high demand and usage by investors. Seeing the present trend of Bitcoin, no one can make speculations about bitcoin prices. Though, it is not beneficial for users to predict future trends due to the volatile bitcoin pricing nature.
- Security issues:
In the present time, hackers are getting clever by breaching online security related to credit cards, Bitcoin wallet, and other things. No doubt, the usage of blockchain technology into Bitcoin is considered to be safe and secure in comparison with the conventional mediums of transferring money. Though, bitcoin hot wallet comes under the catchy eyes of hackers to get access quickly. Several good-profiles became victims of hacking scams.
- Limit on usage:
Not every company accepts payments in Bitcoin currency. This makes it a currency that is restricted with limited usage. No doubt, Bitcoin usage is growing day-by-day, and soon it will become the most used currency with the growing trend. Though it is not the case in the present economy. Some exceptions are there which accept Bitcoin payments.
- No SIPC protection:
With the SIPC (Securities Investor Protection Corporation), it can be beneficial for an investor to insure about $500,000 when any funds get stolen away, or brokerage gets failed. Though, cryptocurrency doesn’t come in the list of things insured by this insurance protection.