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How Much Damage to a Country’s Currency from Bitcoin?
Ever since the creation of bitcoin, the issue has also come to the fore whether bitcoin can replace the local currency of a country? Will bitcoin become so strong in the coming times that it will destroy the currency of all countries?
There is a need to understand this topic in depth because as the crypto sector progresses along with bitcoin and other cryptos, misinformation about it is also creating confusion. In recent times, many countries have recognized bitcoin in their country in different ways. In any country you can pay tax with bitcoin, in many countries you can buy bitcoin and other crypto. There is only one country that has given bitcoin the status of its official currency and its name is El Salvador. Bitcoin and other crypto are completely banned in some countries and in some places the government is still considering this topic.
difference between bitcoin and currency
The first thing to understand in this subject is that what is the difference between ‘Bitcoin and currency’? Bitcoin is based on a decentralized technology and its control is not in the hands of any one individual or community! The working of bitcoin operates on predetermined coding and cannot be changed or tampered with. The amount of bitcoins cannot be increased or decreased.
On the contrary, the currency of every country is controlled by the government there and all the decisions related to the currency are taken by the government of that country. Due to the control of the local currency in the hands of the government, it keeps on making laws about it from time to time and the amount of currency is increased if needed. The government can stop the currency of its country at any time if it wants. If you have bitcoin then you 100% own it but due to government control over the currency we can use the currency but we cannot own it.
The difference between the use of currency and bitcoin
Bitcoin is completely internet based and it is mandatory to have internet and smart phone or computer to use it. Bitcoin transaction is not possible without these two features. If we talk about money, then there are many ways to complete the transaction with money. If there is internet and phone then its transaction can be done through the application but if these facilities are not there then even cash transaction can be done. There is a problem of cash transactions that only a limited amount of transactions can be done with this and its scope is limited i.e. you can do transactions where you are and not anywhere else. Unlimited transactions can be done with bitcoin and the transaction price can be paid anywhere. Apart from this, banks also provide the facility of completing transactions by cheque. The price of bitcoin is not stable, so there is a possibility of both profit and loss for the buyer and seller of bitcoin but the price of the currency is stable so there is no such problem with the currency.
how easy it is to buy bitcoin
As we mentioned earlier, Bitcoin requires a phone or computer as well as the Internet and to use it, education is also needed to an extent. Even today, a large population of the world does not have access to phone and internet, it is difficult to use bitcoin or crypto in such places. The biggest issue with dealing with bitcoin is its price fluctuations and its transaction fees. If the price of an item is set at 100 dollars and this price is given from bitcoin, then first of all, if the person paying this price has to pay even one dollar, then it will become 1% expensive. After this, if the price of bitcoin comes down then the seller will suffer and if the price goes up then the buyer will feel that he has lost. Like a person who bought two pizzas with 10000 bitcoins would be thinking today. As the mining of bitcoin increases, so will its fees along with the price and buying with bitcoin will become less practical.
Late completion of bitcoin transactions is also a big problem. If a transaction is being made with bitcoin, it will not be completed until the bitcoin is credited to the account of the person who has given a facility or item in return. Generally, there are long queues in public places like shops, malls, railway ticket counters, airports and in such a situation, if the transaction is not completed soon then it will create a big problem. The solution to this is that many crypto projects are coming out where the transaction is very fast and the fees are also very low. Looking at these things, transaction with bitcoin seems a bit difficult.
Right now bitcoin and crypto need to eliminate a lot of problems then we can say that transactions with crypto can be possible. Today many countries of the world are introducing their own CBDC and it will make transactions easier. If we look at all the issues, then in the end we can say that bitcoin does not pose any threat to the currency of any country, nor can it ever happen in the future. Bitcoin is a technology that is free from all controls and that is why people consider their investments here as safe. It is possible to transact some services or goods with bitcoin to some extent but it is less practical to use bitcoin and crypto for all the features.
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