Cryptocurrency and its challenges

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Just like a coin has two sides, cryptocurrency also has many aspects. The important topic that arises in our head is □□. What are the benefits of cryptocurrency, what are its disadvantages and what challenges do we face after investing in it?

Today in this article we will read what challenges we have to face after investing in cryptocurrency.

Nowadays people's inclination towards cryptocurrency is increasing because it is a digital currency and the government has no control over it . A good income can be earned by doing research in it and along with this, the process of keeping money in it is also very easy.

People can obtain cryptocurrencies through a process called “mining”. It involves using a computer’s ability to solve complex mathematical equations, which validate and record transactions on the blockchain in exchange for a certain amount of cryptocurrency.

Since , are no government rules on it, so there are many challenges in it□□

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Cryptocurrency prices are highly volatile making it difficult for businesses to accept it as payment.
Cryptocurrency is a digital currency and like every business, news has a great impact on it too. If positive news comes in the market by the media in its favor, then its rate increases a lot but on the contrary, if negative news comes then its rate drastically decreases. News has a great impact on investors, due to which the reaction of investors contributes significantly to its instability. So it keeps going up and down, its prices are not stable . Due to lack of sweet stars, it is difficult to pay it in business.

There is a lack of clear regulation of cryptocurrency making it difficult for businesses and individuals to know how to use it legally.To implement any currency properly, it is very important to have a clear rule in it. Since it is a digital currency, the government has no control over it. So there are no clear rules in it, which makes it difficult for businesses or individuals to know how to implement it legally.

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Cryptocurrency is a digital currency and all the transactions done in it are done through digital means. The currency is always kept in the wallet for which a security key is made but still since it is a digital currency, there are chances of hacking attacks in it, hence it is extremely sensitive.

Despite its growing popularity, the adoption rate of cryptocurrency is still low making it difficult for people to use it as a form of payment in everyday life. One of the biggest reasons behind this is that it has little stability and lacks any regulation, which makes it difficult for people to adopt it.

Cryptocurrency has limited scalability, making it difficult for this technology to handle a large number of transactions.
Stability is more determined by the liquidity of a market (that is how many people are willing to buy and sell at any given price point) than by the price of an asset. But even liquid markets can move quickly if market sentiment about the asset's value suddenly changes. Also, this argument is always clashes with bitcoin's price getting really high because there is no good reason why bitcoin's price should ever get 'really high.'

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The biggest challenge is that electricity consumption is sometimes low and sometimes very high, and it is not certain how much electricity will be used in 24 hours. Cryptocurrency miners react to price fluctuations. This constantly changing reaction results in fluctuations in electricity use as well.

Despite so many challenges, people's attraction towards it is increasing because it is out of the control of the government, hence the tax process is not applicable on it and people are moving towards cryptocurrency while facing the challenges, so we hope that its future will be even brighter.

India, 15.04.2024
@moyeon