3 Reasons Why Cryptocurrency is Still Not Widely Acceptedby Madison L. Digital Marketer
When it comes to cryptocurrency, the first thing that usually comes to mind is Bitcoin. In the Philippines, cryptocurrency made its splash at around 2010. It’s worldwide success peaked in late December 2017, when it neared $20,000 in value.
Unfortunately, Bitcoin and all other cryptocurrencies crashed right after. Now, a bitcoin is worth four figures and is said to be achieving a state of stability.
Why, then, is it still not accepted by the vast majority of the public?
Let’s find out.
It’s an Unprotected Currency
Cryptocurrency is a means of exchange. it’s digital money that you won’t be able to physically hold unless you convert it into your local currency.
In-process and systems, it’s fairly similar to wire-transfers, credit cards, and services such as PayPal.
Only with bitcoin, or any local currency, it’s valuation is not protected.
It is a type of currency that doesn’t have any managing body to control it.
Consider this, most industrialized nations have relatively stable currencies. The value of would usually jump up or down between a predesignated range.
This is because the national banks of these countries are strong enough to control the value of their currency.
They have the means to keep the currency in a good spot by increasing or decreasing the available money supply.
However, some countries do not have any dominant central banks that do this currency management. In turn, their currencies are very volatile.
This makes it extremely hard to keep prices fair.
Cryptocurrencies are part of the later. There is no governing body that controls its value in the midst of changing events.
This also means that no one will help prevent or confront price manipulation.
From a retailer’s point of view, this volatility is not appealing. Nobody wants to accept a currency that can suddenly lose its value minutes after they accepted the payment.
People want security and stability when it comes to their money—which is what the local currencies provide and what crypto currently lacks.
It has a Shady Past.
Cryptocurrency has been around since the 2000s. It reached its height in popularity in 2017, but even before then, it has already been used in business, though not exactly in the best way possible.
In a Forbes article, the most popular cryptocurrency transaction types were laid out, and it’s not something that makes crypto look good in the eyes of potential investors.
In summary, crypto has been mostly used in criminal transactions.
To provide some context, you should first know about the Dark web. it’s the corner of the internet that search engines cannot reach. It’s the dark side of the internet.
Within the confines of the Dark web, the Bitcoin remains the most common form of payment—particularly in the selling of contraband.
Because of this, bitcoin and most other local currencies are allegedly used for cybercrime.
Even just having a few bitcoins would already put you on a watch list.
That being said, this is not always the case. Although several financial and security institution proclaims this, it’s not exactly what most other parts of the world thinks of bitcoin.
Still, the negative connotation that bitcoin has to most institutions bars it from being accepted by them.
The Cryptocurrency Paradox
Crypto has value based on its usage to buy things; because of that value, most owners of bitcoins don’t want to use it to buy things; therefore, crypto is not widely used to buy things and thus has no value other than related to relatively minimal usage.
Most people that own a form of crypto do not want to use them because they believe that it will only appreciate its value. They treat it as an investment, thus they don’t use it.
This line of thinking leads to most crypto investors buying and holding them because they think that its value will still go up in the future.
However, since they don’t use crypto, its value decreases instead.
Unless investors are persuaded to actively use their crypto, then no cryptocurrency is going to be successful.
In the end, most of the leading economist still believe that bitcoin and other local cryptocurrencies will only decrease in value in the future.
In the Philippines, bitcoin is another form of investment that only a handful of risk-takers are willing to make.
Fortunately, recent observations of cryptocurrencies have found that it’s reaching a point where its value is less volatile and relatively more stable than before.
If the time comes when cryptocurrencies much like bitcoin achieve stability like other local currencies (If such a time is to come), then maybe economists and the general public can safely dabble into crypto and use it in their daily lives.
For now, all we can do is wait and see what other upgrades or downgrades crypto will experience in the future.
Created on Sep 19th 2019 21:08. Viewed 249 times.
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