Bitcoin is a digital cryptocurrency that was invented in the year 2008 by a group of unknown people or an individual who went by name Satoshi Nakamoto. The digital currency Bitcoin was initiated in 2009 after implementation was released in the year 2009.
Basically, Bitcoin is a computer file that is stored in the digital wallet app. The wallet app can be used on both the mobile phone and the computer. Users can easily share the Bitcoins, sending and receiving a stipulated amount of Bitcoin. All of the transactions of the digital currency are recorded in the public list that is called Blockchain.
The users can trade Bitcoin for assets like gold or cash. If you are looking forward to the short-term profit, the high-liquidity attached to the Bitcoin renders it the greatest investment vessel.
Is the Operation of Bitcoin so Simple or Is It in Shadows?
Bitcoin usage is not as simple as mentioned above. Though all of the above facts are truer, the practical working of the Bitcoin involves complex rules and regulations as well as fee structures. It has been 10 years to the inception of the Bitcoin, but still, Bitcoin is in shadows. Large numbers of users are unaware of the operation of the Bitcoin, which has obstructed its popularity and acceptance by the public at large.
There are many authorities who have begun to question the future of the monetary assets and similar other financial resources. Bitcoin cryptocurrency is one of the most controversial topics. In the year 2019, the Blockchain technology could have witnessed the public acceptance phase;revolution came to an instant halt. This was rightly called the “Blockchain Fatigue”. There are many factors that limit the popularity and acceptance of the Bitcoin digital currency at large.
They are enumerated below:
- The problem of the Bitcoin Scalability
This is one of the biggest and most serious problems faced by the Bitcoin Blockchain users. The Bitcoin scalability problem refers to the limited rate in which transactions at the Bitcoin platform are processed. The public records, better known as the Blockchain, are very limited in size and frequency. So, the limited three transactions can be processed per second. This limits the functionality of the Bitcoin users, who have to undergo processing delays every now and then. There are many proposals for the correction of the Bitcoin scalability problem, but there are no long-term solutions for the Bitcoin Scalability.
- Costs of Bitcoin Transactions – High Fees
The costs of sending the Bitcoin from one digital wallet to another have risen significantly in the previous years. In the month of August, the price of the processing of Bitcoin cryptocurrency had climbed higher. The price of the Bitcoins Transactions had soared by 547%, rising from the $1 to $6.47.
- Block Time Issues
Presently, users are challenged by block time issues. In the context of the cryptocurrency, the block time refers to the length of time it takes to establish and validate the existence of the new block on the platform. Theoretically, the block time of the Bitcoin Blockchain is ten minutes. However, the reality of the block time is not as precise.
The precise time of mining the Blockchain is difficult and unknown, as the amount of time a block generation takes depends on the difficulty of the hash. Another issue of the block time is that a block is only verified by the Bitcoin miners. The Bitcoin miners compete against each other by solving a mathematical problem.
After combating other a great many block time issues, the successful Bitcoin miner is rewarded the cryptocurrency. The process is complicated and complex, which fatigue the users. It has been a decade to the inception of the Bitcoin, but problems and issues of block time had increased instead of decreasing.
- The volatility of the Bitcoin
The Bitcoin is a high volatile digital currency. For instance, if I set aside the $1,000 for spending it on my next trip to Italy and save it in the Bitcoin digital wallet, the value of the $1,000 can either increase significantly or drop considerably below. In 2010, if the value of the Bitcoin was worth $10, it rose significantly to 10 Million within two years in 2012. The high volatility of the cryptocurrency has not helped in fueling the popularity of the Bitcoin.
In order to achieve mainstream popularity, the Bitcoin price needs to become more stable.
- Convenient of Usage of the Bitcoin
To be honest, the ease of usage of the Bitcoin cryptocurrency had increased considerably since the last few years. However, the interface and rules of the platform are not user-friendly. For instance, if an average user would like to buy the $200 in the Bitcoin, the user needs to open a Bitcoin account and then link the account to the checking account. The checking account has higher fees, and users have to wait several days for clearing the transactions.
All said and done, the processing of the Bitcoin transaction is not an easy affair. Users go through different stages; only then one transaction is completed. This has discouraged users from using the platform of Bitcoin for investment purposes.
The bottom line is that the general concept of the cryptocurrency and Bitcoin is in its infancy. There are many problems attached to the functionality of the network before it receives mainstream acceptance by users. It is also very important to note that this is not an exhaustive list of factors limiting the usage of the cryptocurrency network. There are many other challenges faced by the network, which affect the functionality of the network and the productivity of the users. For instance, there always remains a lingering threat from the governments that could render the usage of the Bitcoin as illegal.
However, most of the problems of the Bitcoin network can be conveniently resolved and settled by the authorities in power. So, you must be aware that there is a great time left before you could encounter a group of people paying Bitcoins in the mall exchange of the shopped items.