Hello friends, in today’s online world no one is untouched by cryptocurrency. Everyone must have heard about cryptocurrency at some point or the other. Not only this, in today’s time keeping cryptocurrency and trading in crypto has become a trend, yet there are some drawbacks of cryptocurrency, which are very necessary to remove.
In today’s online world, the most important question that arises about cryptocurrency is that we are not in a hurry about cryptocurrency?
Friends, did you know that on October 21, 2020, it has been 12 years since the launch of the most popular cryptocurrency in the history of cryptocurrency, Bitcoin. There have been many occasions in the history of cryptocurrency when Bitcoin made its investors rich in an instant. Like bitcoin, many other types of cryptocurrencies have also come into the market in the last few years.
In today’s era, 70 percent of investors are moving towards cryptocurrencies. Given its popularity, some countries have officially recognized cryptocurrency, and in some countries there is still a debate about cryptocurrency. Warren Buffett, one of the world’s leading rich people, has also expressed doubts about cryptocurrencies, he also tried to attract public attention like vulnerabilities of cryptocurrencies and poor protocols in terms of security in the coming times.
Weaknesses of Cryptocurrencies
You must have seen in the last few years that the price of bitcoin sometimes rises suddenly, and sometimes falls suddenly. This is one of the biggest drawbacks of cryptocurrencies. There can never be any accurate prediction on the volatility of cryptocurrencies. That’s why one side of all the enlightened people from the world is not in favor of cryptocurrency. The economic and ecosystem of cryptocurrencies can never be trusted anywhere and anytime. According to a report, 60% of all investors in the world do not even know how cryptocurrencies work, even if they have a small amount of cryptocurrencies. If you are also the owner of cryptocurrencies, then the biggest problem and risk before you is to come across other competing cryptocurrencies and increase in their prices can create trouble for you. If the price of cryptocurrencies decreases after your investment in cryptocurrencies,
If seen in a way, this currency is a fake currency, which works only by keeping the investors deceived.
scalability of cryptocurrencies
When it comes to the weaknesses of cryptocurrencies, the biggest weakness that comes to the fore is its scalability. To know the scalability of cryptocurrencies, we have to go to the root of the problem of cryptocurrencies. And at the same time one has to understand the concept of scalability of cryptocurrencies.
There are usually only two options cryptocurrencies can choose between speed, security, and decentralization. That’s why the famous cryptocurrencies named Bitcoin and Ethereum have chosen the path of security and decentralization. Therefore, the pace of investment and profit in them is very slow. When looking at other cryptocurrencies, the speed of investing and making profit in them is very fast, investors can invest their money whenever they want and can withdraw their money whenever they want.
Lack of exchange in cryptocurrencies
Another reason is that cryptocurrencies are not regulated in any way, which makes it difficult for investors to completely trust the system of cryptocurrencies. Unless cryptocurrencies are regulated, the use of cryptocurrencies from a security point of view can prove to be very damaging.
There are also some people who have officially recognized cryptocurrencies, all of them are making many rules for using cryptocurrencies safely and efficiently.
Lack of illiquidity in cryptocurrencies
Another main weakness of cryptocurrencies is its illiquidity. For example, suppose an investor raised $7 million by selling his assets and put those dollars in cryptocurrency, and now there is no guarantee that the same amount will be returned if needed. Because in such occasions many investors have to bear the loss.
As you know that cryptocurrency is an e-currency, and its cyber security and its hacking has raised questions from many people. For example, about 8 million bitcoins worth of cryptocurrency was stolen from the account of Swiss blockchain company Trade.io, which used to use cryptocurrencies a lot. Many such small and big hacking cases and cyber security breaches have become common in cryptocurrencies.
Ever since the cases of ransomware attacks have come, most of them have been related to theft of cryptocurrencies. Under this, ransomware attackers first send a virus to the users’ computer, and then lock all the files on their computer in some way, then ransom is demanded in return.
In conclusion, it can be said that even though there are thousands of questions in people’s mind regarding cryptocurrencies, yet many businessmen, investors and various organizations have encouraged cryptocurrencies. Many investors have agreed to accept payments in the form of cryptocurrencies as well. The most important thing in today’s time is that if you also want to invest in cryptocurrencies, then first understand the precautions of blockchain and cryptocurrency well, for this you have to work by making a special strategy.