Bitcoin has faced a lot of trials in the past year. After the 2008 cryptocurrency crash, Bitcoin succumbed to a near-death experience but was able to rise again from the ashes. The challenges Bitcoin will face in the future are unpredictable. But what are the anticipated problems that people think will happen?
Security of the System
The major problem with cryptocurrency is how to keep the bad guys away. Central banks around the world invest millions in implementing the state of the art security system to ensure that people’s money is safe from robbers.
Cryptocurrencies share the same challenge. Bitcoin can buy stuff, even illegal paraphernalia. Will this stop robbers from hacking in the system? In 2018, hackers hacked Japan’s largest cryptocurrency Coincheck, which contributed to the 2018 crash.
If Coincheck can be hacked, then it must follow that other people can cut other altcoins. Thus, security is a grave threat to the future of Bitcoin.
If Bitcoin can be used as a way of acquiring goods or services, large companies might have a problem with this. Real-world business transactions are processed in large quantities every second.
Cryptocurrency systems can process only 10-100 transactions per second. That would be like 100 customers can be accommodated on a certain second against billions around the world.
However, this problem will see its end soon. Tech companies are now on the verge of putting an end to this logistical limitation.
Liquidity has been a long-standing bitcoin challenge ever since its inception. Due to unpredictable fluctuations in price, many people become less confident with cryptocurrencies.
Perhaps, the price of Bitcoin tends to be influenced by market forces. Considering that Bitcoin is a speculative investment and the most speculative of all, it will be hard to guarantee its liquidity.
Credibility and Likelihood of Government Intervention
Yes, Bitcoin is a good investment. But, it is also used by criminals to acquire illegal substances, weapons, and even pornography. You may be an investor with good faith, but the other people using coins might have bad intentions.
With the rising concern for money laundering and drugs, the governments of the world might intervene. It’s hard to say when and how, but when things blow up into proportion, you expect that the governments’ noses will start sniffing.
Bitcoin faces a lot of challenges in the near future. It is a disruptor, for it enabled a whole new world of thinking business and economics. Who knew that a set of cryptographic codes could buy stuff like it’s money? That’s why Bitcoin has a bumpy future ahead of it. Brace yourselves, crypto investors.