Cryptocurrencies have had to travel been characterized as a complex path full of challenges. They have had to demonstrate the capabilities they have to lead a Rise of Bitcoin.
The decentralized technology offered by the blockchain is the most potent attraction of these financial tools, guaranteeing secure operations that any intermediary cannot alter.
By 2022, the level of adoption of CRYPTOCURRENCIES worldwide will reach almost 20% of the population in various countries, something that is not an insignificant amount.
Over time they become more interesting not only for individuals but also for large companies, their owners, and without a doubt for financial institutions and governments.
All these aspects are usually very positive, but if we are aware of something, the good is always accompanied by harsh criticism and radical opinions that, in many cases, have managed to destabilize the digital financial market.
Advantages and disadvantages of cryptocurrencies
After their popularity and significant impact on the world economy, cryptocurrencies have had to adapt to society and the market, and vice versa; the world population has had to accept and adopt them, and of course, the financial market has been forced to give cryptocurrencies the opportunity to a new form of market.
Something important is to know where we are stepping. That is where we must analyze the pros and cons of digital currencies before making any investment.
If we refer to advantages, we find in the first place they are digital currencies that are characterized by being decentralized; there is no manipulation or control by third parties, only the interested parties.
Security in operations is backed by state-of-the-art technology used even by traditional financial institutions.
Thirdly, we find the comfort and low costs per transaction offered by operations with digital currencies, avoiding the high costs of bank commissions.
Fourth is the profitability generated from investments in the short, medium, or long term.
Fifth is the possibility of knowing its value in real-time and always being up to date concerning it without waiting for a financial or macroeconomic factor to establish it.
Suppose we refer to the cons that digital currencies have without thinking twice. In that case, we find two main ones: their volatility and the risks assumed by bad investments.
Volatility accompanies them all the time; unfortunately, they are assets extremely vulnerable to market changes, which causes them to have bullish phases and suddenly go down.
The risks are common in all financial operations, whether in the traditional or digital market. However, the amounts of money put at stake here are usually higher due to the price of digital assets.
Criticisms that have caused Bitcoin to fall
Although digital currencies, from the moment of their creation, have not been linked to external or macroeconomic factors that control the traditional market, something that has impacted their valuation is the opinions of third parties.
When prominent business people or any particular user issues an opinion for or against cryptocurrencies, their valuation can skyrocket or drop.
Such is the case in particular of the opinions issued by Elon Musk that after accepting BITCOIN as a form of payment for his vehicles, he retracted and, with only two statements, made the price of this digital currency rise and fall abruptly.
On the other hand, we constantly find the opinions on the internet of people who have invested their savings and, unfortunately, have lost them without having the right to claim anyone since the digital market regulates itself; no entity controls it.
Other criticisms that have impacted their valuation are those issued by governments such as Russia and China; after being considered the countries with the most effective use of cryptocurrencies through operations on exchange platforms, they decided not to accept more cryptographic operations in their territories.
Conclusion
All the criticism that has been generated around cryptocurrencies seems to strengthen them somehow since after they have affected the valuation of digital currencies, they have ended up adopting them or even storing Bitcoin units in their digital assets.