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Notes On Bitcoin 23

Bitcoin faces significant trust issues due to its association with scams and a lack of mainstream understanding, which complicates its adoption. While it offers advantages like low transaction fees and reduced fraud risk, its price volatility poses challenges for investors. Emerging markets present opportunities for bitcoin's growth, particularly through mobile payments and bitcoin debit cards, but widespread merchant acceptance remains limited.

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14 views2 pages

Notes On Bitcoin 23

Bitcoin faces significant trust issues due to its association with scams and a lack of mainstream understanding, which complicates its adoption. While it offers advantages like low transaction fees and reduced fraud risk, its price volatility poses challenges for investors. Emerging markets present opportunities for bitcoin's growth, particularly through mobile payments and bitcoin debit cards, but widespread merchant acceptance remains limited.

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prototype199191
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[ Trust ]

Talk to the average Joe on the street about bitcoin, and you’ll probably receive one of two possible
responses. They’ve heard of bitcoin because of Silk Road, Mt. Gox, or other type of scam associated
with this disruptive currency. These types of bitcoin stories have been picked up by mainstream
media all over the world. Lack of mainstream exposure is one of the issues that has been plaguing
bitcoin for quite some time now; its PR image caters to tech-savvy people.

In fairness to the average Joe, the entire bitcoin concept is fairly technical, as most of the focus
revolves around blockchain technology. But you don’t need to know every nook and cranny about
bitcoin in order to use it. Setting up a bitcoin wallet requires the installation of software on a computer
or an app on a mobile device. As a result, there is an educational problem with bitcoin, which causes
analysts to call the technology “far ahead of its time.”

There are several bitcoin conferences around the world every year, but ticket prices are too high for
the average person to attend. There are local bitcoin meetup groups all around the world too.

One of the core elements of any kind of payment technology is trust. Given the number of headlines
concerning bitcoin and scams, hacks, illegitimate services, and whatnot, there is a huge trust issue
bitcoin needs to overcome. Rather than trusting the economic value of a bitcoin individually, it is more
important to put your trust in the entire bitcoin network. That includes all associated services,
companies, mining pools, and users in existence today, plus the ones that will be joining the network
in the future. As is the case with any form of payment method, adoption is slow and faces a lot of
adversity and scrutiny from competitors.

It is convenient to use a bank account and bank card for storing and transferring money. Banks have
a virtual monopoly on what they do in providing financial services, and alternatives have historically
been few and far between. Traditional financial institutions want to dictate how we can spend money,
and more importantly, how much we can spend. Although bank cards, credit cards, and even bank
transfers are frequently used to pay for just about anything, and cash is slowly becoming obsolete
funds are prone to being limited in those areas too.
[ Volatility ]
Bitcoin is a financial tool that carries risks just like any other payment method or currency does. Part
of that comes in the form of a rather volatile price. Bitcoin and the underlying blockchain technology
reduce a lot of the risks presented by traditional payment methods. There are no chargebacks, fraud
is tough due to transparency, and the transaction fees are very low compared to credit cards, wire
transfers, or remittance services.

It’s a new breed of technology which is part ideology and part payment method although the best
solutions and implementations may not be viable in the end, if nobody adopts them.

Investing in a company that is working on this new technology is a different matter altogether, but that
principle is the same for any company you want to invest in. Bitcoin company investments are not
inherently riskier than investing in any other startup company.

When it comes to speculating on the bitcoin price however, the story is a bit different. If you look at
bitcoin from the perspective of an investment vehicle that will likely gain value, there are quite a few
risks attached. Speculating on price volatility is never a good idea, and bitcoin is proving to be rather
volatile on a daily basis.

Investors from all over have been buying up bitcoin, as they feel BTC is a safer method of storing and
transferring value compared to precious metals or traditional payment methods.

Bitcoin could be used to pay for virtually anything in-store or online and regular bills using third- party
services. The main objective is to cut out middlemen from the equation.

Key areas and emerging markets such as Africa, Asia, and even Australia have been overlooked.
Asia and Africa are obvious choices, due to their remittance market potential, being underbanked,
and technological prowess.

Bitcoin debit cards are proving to be a great example, as they allow you to spend BTC wherever
major credit cards are accepted. However, that will not push merchants to accept bitcoin all of a
sudden, as it is just a regular card transaction to them. Paying bills with bitcoin is possible too,
although those services are presently limited to SEPA zones. SEPA zones are European countries
where the SEPA protocol is used by banks and financial institutions. SEPA allows citizens to send
bank transfers, denominated in euros, to other countries using the euro in a short span of time
(usually one to two business days). SEPA is a forerunner to bitcoin — a case that has the potential to
change the financial system as we know it.

With mobile payments becoming more widespread, bitcoin is a very strong contender. Mobile bitcoin
wallets were available before most financial institutions unveiled their mobile apps. Moreover, most of
these wallets have been improved over the past few years, making the transfer of bitcoin as easy as
scanning a QR code with your mobile device’s camera.

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