Back in 2009, the entry of Bitcoin in the financial market hit a small section of interested people like an explosion. The majority were a bit confused about the turn of events. Some say that Bitcoin's aim has not been fulfilled by itself yet. Another section believes that Bitcoin carves a gradual upward trajectory and is a good investment in the long run. There can be no benchmark in terms of technology, but Bitcoin, it seems, is building its own. Or is it not? Let us look at some of the pros and cons of choosing BTC as an alternative form of monetary exchange.
Pros of using Bitcoin
We will possibly be safe from inflation.
Fiat currencies are not immune to inflation. Their values often decline over time. However, only 21 million BTC can exist in this world, which is how it is programmed. The benefit is that since demand will get higher over time, the value of BTC must increase accordingly to strike a balance and prevent inflation.
Decentralized currency
Unlike fiat currencies, Bitcoin is outside the reach of an intermediary third party who controls the flow of the money or its value. Central banks of various governments manage fiat currencies, and they enjoy the monopoly of the system. Centralization is a hindrance to you when it is about working your own money for yourself. A single administrative body does not govern Bitcoin.
Security and privacy
Bitcoin depends upon blockchain technology which is a peer-to-peer ledger network. Miners cross-check and verify all the transactions and crack complex mathematical equations to decode the complexity of coded information present in the blocks. This activity makes the entire Bitcoin experience safer. Bitcoin has also worked upon its bugs and has made itself more secure than before.
Easy and mobile payments
Wherever there is an active internet connection and a smartphone, one can transact through Bitcoin. Searching for ATMs or visiting the bank to use your own money is a big no-no for Bitcoin or other cryptocurrencies. It is also more accessible because you need not enter a lot of personal information every time you want to transact. Last but not least, in the case of international payments, transaction fees are much lesser as there are no intermediaries between two parties.
Cons of using Bitcoin
Often used to transact illegally
Bitcoin, due to its anonymity, is difficult to track down. It uses complex user addresses for transactions. Throughout the history of Bitcoin, it has always been a target of smugglers and frauds to illegally transact money and put the safety of the community in question.
Often a hub for hackers
Blockchain or Bitcoin in themselves are pretty secure, but the problem of dubious entities hacking your assets often occurs when you pass through Bitcoin exchanges. Third-party malware can save your credentials and other Bitcoin information that you put in otherwise trusted businesses like Bitfinex or trading software like crypto trading. However, this kind of software is highly secured nowadays, but no one can rule out such a possibility.
Risky in terms of losing data
Due to its high security, it is practically almost impossible to trace down your assets. The issue of traceability makes crypto a better option than regular bank safes. However, the private and public keys are fundamental. If you lose your private key, you will lose all your Bitcoin history, and your asset will sink into nothingness. If such a situation occurs, it will be difficult for you to retrieve whatever you lose.