Ever since the first cryptocurrency came in the limelight, people have raised serious concerns relating to this technology. But, unlike blockchain, its parent technology, these cryptocurrencies fails to impress many sectors.
Many governments and financial sectors worldwide are in the league for the alienation of these digital currencies.
Moreover, some of the banks have completely denied trading with crypto-related companies. But why do people fear investing in these cryptocurrencies? Why people resist using or investing in these digital currencies?
Let's dive in the article to find some reasons and how things can be made at ease:
Knowledge And Understanding Lack:
Lack of knowledge and understanding is the prime reason for people refraining from the digital currencies. Some people fear because of the complexities they offer. They don't know how they should deal with this virtual money.
Well, that's the same with all new technologies and innovations. But, with time, it will subside. Also, things like bitcoin credit card wallet and other cryptocurrencies are completely technical, and the person without technical knowledge will find it hard to understand.
Furthermore, it lies in algorithms and laws of mathematic, which not many people are aware of. However, the education on these digital currencies will fade away all fears and increase the trust in them.
No Legal Tender:
The government does not back cryptocurrencies; instead, they are decentralized smart contracts. This makes them not to be known as legal tender. These legalities give rise to fears from sectors, especially from the government agencies that are afraid of the system fail.
Another thing that creates worry is illegal worries that give rise to activities like terrorism, frauds, and money laundering. Solution?
Regulation in the financial flow will help to ease the money laundering and other fraud activities. This will help to control the wrongful transaction.
Volatility In The Price:
This is the most common and obvious reason why people called Bitcoin trading as gambling. Despite is exact price always making news, there's always some kind of uncertainty that stays in the market. You can expect a sudden rise and an instant downfall in one day.
There was a time when bitcoin collapsed to $3,800 suddenly, which people later named that drop as "Black Thursday." However, this volatility is not as bad as it is represented. The same occurs in investing and other schemes. You just need to understand the limitations of your risks and the coin you are investing in.
Whenever you buy any digital currency, you have to store it somewhere, and the best platform to store them is a crypto wallet. However, having less knowledge about the crypto wallet makes it difficult for ordinary people to trade and invest.
Basically, a cryptocurrency wallet is made from codes that make digital transactions, and as the cryptocurrency is itself a code, non-technical people find it is used to store money.
Has Its Own Ups And Downs
Another reason why people fear is that it may lose its value. It is apparent that cryptocurrency investors have faced many ups and downs in the market over the past years. While it has seen both increases and dips, it is here to stay.
The reason why it is going to stay is that the transactions are more secure than the govt. Backed legal tender. Thus, it is difficult to forge or steal. There have been security issues, though. People need to learn more about using cryptocurrency safely to embrace its continued use.
Too Many Crypto's:
Bitcoin? Etherum? Ripple? In which should I invest! If someone understood the algorithm behind these cryptocurrencies, another confusing thing that arrives is which cryptocurrecy one should invest in.
Over the past few years, the number of digital currencies has seen huge growth. So, if you want to invest in it, dig deep and research. Keep in mind that investing without research can be a huge fall.
Now that we have clear all the doubts that often stopped people from investing in digital currency, keep them in mind and give it one shot!