For people outside of the complex and exciting world of cryptocurrency, Bitcoin can be hard to understand. Many have brushed it off for years, saying that it was bitcoin down lines fad that would disappear as quickly as the value of Beanie Babies. Many old-school investors who haven’t done their research will simply say it’s in an economic bubble and call it a day.
But the reasons why Bitcoin cannot succeed in the long run go so much deeper than that. Just like any other speculative asset, no one really knows what is going to happen in the future. However, when one looks at the big picture, it becomes clear that Bitcoin will struggle to survive. The most valuable thing about Bitcoin is that it introduced blockchain technology to the world. Blockchain technology drastically improves the speed, privacy, and security of sending money.
However, even though Bitcoin was the first to introduce blockchain to the world, it’s not necessary for blockchain to exist. Sort of like if one web page goes down, the Internet still exists. Most people never saw the very first website that was ever created. One of the biggest benefits of Bitcoin it that it is supposed to be private, secure, and untraceable. Obviously, this was a huge benefit for criminals on the Dark Web. Cryptocurrency got a really bad reputation once news broke that Bitcoin was being used to send money anonymously on the drug trafficking website Silk Road. The appeal that a lot of Americans see in Bitcoin is that they believe they can avoid paying taxes to the IRS, which is also a crime.
In 2013, 44 percent of the Bitcoin supply belonged to people who identify as Libertarian. What casual Bitcoin users don’t seem to understand is that even though their name is protected as a string of numbers and letters on the public ledger, that doesn’t mean they are fully anonymous. Most Bitcoin exchanges like Coinbase require that new users must upload the front and back of a Photo ID as well as take a selfie to prove that it’s really them. The FBI has made it very clear that they are watching Bitcoin very closely, and they are getting better and better at finding the true identities of the people who use Bitcoin for illegal activity.
They are fully aware that not everyone who uses Bitcoin is a criminal. Bitcoin was created by the man of mystery, Satoshi Nakamoto. While there are many compelling theories about his true identity, no one knows exactly who he is. At the beginning of the Bitcoin project, Satoshi was able to guide the coders who helped create the platform any time they had a question. Now, coders and miners must come to a consensus every time a decision about Bitcoin’s future must be made. Unfortunately, the community cannot seem to agree on even the smallest decisions. There is no clear business plan mapping out Bitcoin’s future.