Introduced by Satoshi Nakamoto in 2009, Bitcoin is both a peer-to-peer payment system and a decentralized money transfer technique. Coined as “virtual gold,” Bitcoin’s production is headed by rules which disable its manipulation, stealth, and devaluation by the government. Every new technology is succeeded by criticisms and applauds, and Bitcoin is no different.
As much as Bitcoin enjoys independence from governmental entities and duplication (by using strong cryptography), it also has a questionable take on protection and safety. As a result, there are just as many hardcore Bitcoin fans as there are strong critics. These critics think of Bitcoin as a bubble. They generally situate these thoughts over the fact that money cannot be developed out of thin air solely on digital platforms.
For example, CEO of JPMorgan Chase, Jamie Dimon, feels that Bitcoin is not only a fraud, it's a huge risk. A risk that will eventually blow up and fizzle out. His argument leaves the general public questioning whether Bitcoin is more of an investment or a gamble. Keeping these statements apart, let’s look at some of the things that bother me about Bitcoin compared to other cryptocurrencies.
Bitcoin’s transaction speed was much faster in 2010. It could, therefore, be used for spontaneous transfer and served as a practical mode of payment in the supermarkets and shops that accepted it. However, as the number of people using Bitcoin increased, the more scalability issues occurred within the Blockchain.
As a result, participants found it difficult to keep up with such a high number of transactions in Blockchain. The time required increased to approximately 1-2 hours for 7 confirmations. However, a new upgrade called the “Bitcoin Lightning Network” has been working to fix this issue. While slow processing speeds are a point of frustration, it’s nice to know that they’re ultimately temporary.
High Transaction Fees
Even though Bitcoin was advertised as form of currency with little to no transaction fees, things have changed over time, with transaction fees steadily increasing as the number of users increase. Originally a few cents, the fee first increased to $6. Recently, it was registered that a spike in the Blockchain network raised it to as much as $26 per transaction.
This might come out as irksome but on the inner levels, it is advantageous to Bitcoin users as a higher fee generally results in a higher priority transaction within the Blockchain network. This leads to faster confirmation and processing. However, a relatively higher fee does not guarantee that the transaction will process quicker than the standard time limit.
It’s worth noting that the problem of high fees only arises when Bitcoin gets a good number of network traffic and congestion. On a normal day when network traffic isn’t heavy, the fees are pretty moderate. Either way, this isn’t enough to discourage me from partaking in Bitcoin, and in the future, transaction fees will likely be more streamlined.
Why I'll Always Want To Buy More Bitcoin
There are no anonymous “WHALES” in the Bitcoin community as opposed to altcoins. With altcoins, there’s a possibility of price manipulation if users buy a huge chunk of it and change the ratio of supply and demand. However, Bitcoin is scattered among many people since no one expected it to be worth such a huge amount of money.
As a result, the possibility of price manipulation is slim, making it more “decentralized” in its true state. The global economy is unstable. We don’t know what the future holds, and history has shown how easily the cash economy can be disrupted as soon as something happens globally. However, Bitcoin doesn’t rely on any one stock market or government.
Bitcoin may, in fact, benefit from a disruption to the global cash economy, making it advisable to diversify your funds. Many criticize Bitcoin for not having any definable value, but they fail to understand that the real value of Bitcoin is its USP of Blockchain and Cryptocurrency Market. The value Bitcoin holds is in the eyes of new buyer who starts their first cryptocurrency trade in Bitcoin, rather than any other coin.
Also, the prices of all other altcoins are somewhat dependent on the price of Bitcoin. Even today, we bid for for them in terms of BTC and not USD. It’s the BTC’s value that ends up being converted to USD, and that’s how we derive the value of altcoins in USD. Every technology has its own pros and cons, but that shouldn’t prevent us from placing our confidence in said tech.
History has shown that all new inventions are initially met with criticism along with a host of problems in their initial testing phase. Later on, though, they’ve risen to global distribution. One good example is the lengthy war over the distribution of electricity. With that in mind, it’s always advisable to give new technologies a chance to take on and shape the world in their own unique way.