Lately, bitcoins have become very popular. So many investors are trading bitcoins on a daily basis. The exponential growth that bitcoins experienced in 2017 is unrivaled. There was massive growth of cryptocurrencies in 2017 with about 1,100 different types of digital currencies in use as of December 2017.
People have realized that using digital currencies is more convenient in many different ways as compared to using fiat currencies. As compared to the normal currencies, transacting in has bitcoins very many advantages as discussed below.
This virtual currency is not regulated by any central authority. This means that the operations of bitcoins are influenced only by the buyers and the sellers. There is no third party that can manipulate it. It cannot be artificially inflated or devalued by banks or governments as they do with the normal currencies. Since there is no government influence in bitcoin trading, there is no fear among investors that the currency can be devalued to the detriment of the investor.
Only 21 million bitcoins will ever be in use at any given time. Bitcoins do not stand a chance of failing. For instance, if the economies of China or America collapsed today, the Yen and the US dollar would terribly suffer. Since it’s a standard worldwide virtual currency, geo-politics have no influence on this currency.
2. Protection of Privacy
Bitcoin transactions do not reveal the identities of the transacting parties. However, the transactions are very transparent because the public ledger records and gives visibility of the transactions. The ledger provides information of how the bitcoins were exchanged identifiable only through wallet addresses.
With no personal identity information, more people prefer to transact using this virtual currency as no tracking can be done to an individual. Though some critics say that this promotes illicit payments, supporters on the other hand value this privacy. Making payments through the traditional methods such as banks require that you provide all your personal information which Bitcoins bypass.
3. Freedom of Transaction
There is no intermediary that controls how a person uses his or her bitcoins. Ordinary payments often have limits of transactions based on amounts or geographical locations. Traditional currencies can be frozen by intermediaries such as PayPal or banks. Some organizations can limit transactions that they feel are not favorable for them. This is not the case with bitcoins. Bitcoins give the users absolute freedom to buy or sell whatever they want with no restrictions at all. Whether your business is legal or illegal, you can still receive payments using bitcoins.
4. Easy to Use
Virtual currencies are very easy to use. Traditional currencies are often faced with challenges such as delayed transactions and inaccessibility to banks. You need to physically go to a bank in order to open a bank account. This complicates the entire process of payment. With bitcoins, you can receive or send payments from your mobile phone or computer at the comfort of your seat back at home. Unlike bank accounts that require money to open, downloading a virtual currency wallet is free. You do not have to fill any forms or spend time queuing.
5. Fast Transactions
Traditional transfers often take long. In fact, sending money from one continent to another may take several days. Bitcoin transfers, on the other hand, only take few minutes. By just clicking the send button, a person in Japan can receive bitcoins from a person in Brazil within a few minutes. Banks usually have working hours and are closed at night, during holidays and during weekends. With a computer or a mobile and internet connection, you are able to transact with bitcoins any time, any day.
6. Durable and Portable
You cannot damage or destroy a bitcoin. The supply of gold and silver, for instance, can be manipulated if their supply is interfered with. Traditional currencies like dollar bills can be destroyed or counterfeited.
Since bitcoins are not physical, they cannot be manipulated. This virtual currency is also very portable. This advantage gives it an upper hand over normal currencies. You need somewhere to put your money when traveling, for instance. Different countries have permissible limits of possession of cash money especially when traveling out of the country. This often hinders those interested in walking with a lot of cash money.
7. Reduced Fraud
With the use of bitcoins in transactions, there are very slim chances of fraud. Criminals often steal credit cards and withdraw money or make online purchases. Since this virtual currency is purely digital, there are no loopholes that could allow for manipulation of a person’s funds. The sender can only send the exact amount of bitcoins that he or she wants and the recipient has no way of manipulating the payment in his favor. This makes bitcoins a very safe currency to transact with.