Cryptocurrency has been viewed as a progressive innovation in the economy. It has achieved several successful financial goals by gaining mainstream traction worldwide. With various innovations and accessible infrastructure apps, it has provided the users with benefits like quick transactions, potential returns, access to digital exchanges and trading platforms via this Official Website. However, success does not come alone. It passes through many crests and troughs, including controversies, faults, errors, etc.
The journey of cryptocurrency is linked with a mine of controversies. The article discusses some of the significant arguments that cryptocurrency has witnessed in its history.
Controversies of the digital currencies
Cryptocurrency has been a significant challenge in the financial system of the world. With several advantages, it poses high risks to the users. The risk factors have made it quite controversial, and experts are debating over various aspects. Some of them are listed below:
Does virtual money fulfill the elements of cash as per the law?
The consideration of digital cash as a form of money is still controversial. Many law and finance experts insist that it does not fulfill the legal criteria of money and hence cannot be regarded as money. Money has three properties: a store of value, a unit of account, and an exchange of commodities.
However, a few people have accepted it and used it as a mode of exchange and began using it as money for trade, transactions, and purchasing goods through digital marketplaces. At the same time, most of them use it for investment purposes, which does not make it fall in the category of money.
Digital cash does not abide by laws and regulations.
The lack of laws and regulations makes it highly controversial. The legal status of digital cash is still under debate. Many countries have accepted it. On the other hand, several countries have imposed a complete ban. This is because it underpins no laws, which can cause the involvement of fraudulent activities, such as drug trafficking, money laundering, etc.
The extreme vulnerability to cyberattacks.
Digital cash has come across several fraud events, including fraudulent initial coin offerings, Ponzi schemes, false claims of potential returns, cyber theft, etc. These back and forth cybercrime activities have made it controversial among investors.
They have lost faith in it, while others still believe in skyrocketing profits by using appropriate investing strategies. This discussion is not over yet, leading to controversy among the critics.
It protects the anonymity of the users.
In a blockchain network, the transactions are carried out with a pseudonym. The information regarding transactions, such as date, time, details, etc., is stored in smart contracts by solving complex mathematical puzzles. Therefore, there remains no track of the sender or receiver’s location, name, national identity database, etc. The details are kept anonymous.
This has resulted in illicit transactions. Criminals have started to send hefty amounts as cross-border transactions for money laundering purposes. Hence, it has become the target of critics, making it controversial.
Cryptocurrency’s high volatility is beneficial and hazardous, both simultaneously.
The cryptocurrency has grabbed the spotlight because of its sudden price fluctuation. For instance, Bitcoin, the first known cryptocurrency, began its journey from a few cents. Imagine someone purchasing ten bitcoins for a few dollars. Over the years, the currency skyrocketed to 69000 US dollars. A person who had purchased 10 BTC would have gained potential benefits by just waiting.
Now think vice versa because the price goes down within an instant. Therefore, it can lead investors to considerable losses. This is another controversy that corresponds to digital cash. On the one hand, it can give high profit, and on the other, it can land the investors in hot waters.
The above discussion enables us to conclude that cryptocurrency is a significant challenge for the global financial system. It has taken the world’s economy to the next level. With its emerging success, it has given birth to many controversies across the globe. Digital cash is still struggling to find ways to get rid of the discussions and get accepted as a form of money globally.