How Usability & Volatility Restricts Bitcoin Regulation?


risks-of-bitcoin-coin-and-computer-middle-class-dadIntroduction

Some people want to invest in Bitcoin, but something is holding them back. Do you know what it is? Well, there is no particular reason behind it because different people have a unique perception of Bitcoin. Since it’s a relatively new concept for many people, they don’t understand it properly.

In general, some people don’t understand Bitcoin, while others think it’s too risky to invest in it. If you don’t understand it or you think that it’s too risky, visit www.yuan-paygroup.com to know more about Bitcoin investing opportunities and how you can earn money safely. Here we will know about how usability and volatility restrict Bitcoin regulation.

How Usability Restricts Bitcoin Regulation?

Some usability issues restrict the government from regulating Bitcoin. The Bitcoin community needs to address the following problems for the wide adoption and regulation of Bitcoin.

No Protection Code For Wrong Transactions

Chances are higher that you will never get back your Bitcoins if you send them to the wrong address. Once you send your Bitcoins to the wrong address, the user to whom you have sent your digital money may not send you back, and you lose them forever.

So, a protection code can prevent this problem. That means the recipient needs to enter a code given by the sender to accept the money. However, it may increase the time of the transaction, but it can save you from sending money to the wrong address. This is a usability issue that prevents Bitcoin regulation.

Immutability

Another main concern is you cannot revert back transactions because once you send money to the wrong address, they are gone. You cannot get them back. However, there is a feasible solution that a third-party can hold it back for a fixed fee with the help of smart contracts. One of the existing solutions for this issue is Bitcoin vaults.

Complex Address

If you want to memorize the Bitcoin address of a user, probably you cannot do it. Since the Bitcoin wallet addresses are too complicated, it’s not possible to remember them. However, you can remember the phone numbers and email address, but you cannot memorize a Bitcoin wallet address.

Poor Scalability

Presently, it’s the biggest problem due to low transaction speed in the Bitcoin network. It’s far less than the payment processor VISA, which has an average transaction rate of 24,000. Even though the Bitcoin community has come up with the Lightning Network prototype, it’s still in the development stage and not a full-fledged solution.

Lack of Trust

Since Blockchain uses the same level of security for every transaction, it makes the process lack trust. Although it uses high-level security features, the anonymity feature allows criminals to make illegal transactions.

How Volatility Prevents Bitcoin Regulation?

Have you ever observed the price fluctuations of Bitcoin? You can check out the price of  Bitcoin; you will see that there is high volatility. It’s not possible to use a currency that is not stable because merchants and customers will find it difficult to exchange products and services.

For instance, if you bought a product by paying 0.0025 BTC yesterday but the value of Bitcoin suddenly decreased. Now, the merchant will make a loss because the value of Bitcoin is reduced. The next day the value of Bitcoin rises, and you may regret thinking that you have paid more. So, price fluctuations of Bitcoin cannot make the exchange process smooth. Hence, the volatility issue is the main concern for Bitcoin regulation.

Final Thoughts on Bitcoin Regulation

Apart from usability and volatility, there are other reasons that prevent Bitcoin regulation. Some nations, banks, and financial institutions don’t want Bitcoin in the financial world. Since it’s working in the decentralization principle, it will take away the power and their business from them. So, they don’t support and even don’t want it to be regulated. Finally, what’s your opinion on Bitcoin’s regulation?

Jeff Campbell

Jeff Campbell is a husband, father, martial artist, budget-master, Disney-addict, musician, and recovering foodie having spent over 2 decades as a leader for Whole Foods Market. Click to learn more about me

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