5 reasons why Bitcoin will fail

Bitcoin has become very popular recently. More and more people are buying it, not wanting to miss out on the one million dollar Bitcoin. However, I don't believe Bitcoin will ever come close to being worth a million dollars per Bitcoin, for five reasons:

1. The size of the blockchain. One of the benefits promised by Bitcoin is to be able to bypass banks. However, this will change soon. The more Bitcoin is used, the bigger the blockchain becomes. Currently, the blockchain is around 150 gigabytes. This means most people can't or won't use the Bitcoin app on their smartphones. As such, they are forced to use third party wallets. Once governments force third party wallets to meet the requirements of banks, the benefit of not using banks will pretty much be dead (unless you want to carry around a laptop).

2. In order for a currency to be desirable, it needs to be stable. A high inflation currency is bad for buyers because it means their purchasing power is continually falling down. An inflationary currency is bad for sellers because it means they have to keep changing prices. It is bad for an economy because it results in shortages, since people are always trying to get rid of their currency by buying whatever is available. A high deflation currency is bad for sellers because it means no one will ever buy their products unless they absolutely have to. It also means changing their prices all the time. It is bad for an economy because it results in little innovation. Since Bitcoin is pretty much setup to be deflationary, because it is limited to 21 million Bitcoins, it means it will never be a desirable currency.

3. The cost of sending transactions will just keep getting higher. Currently, it is costing around $20 to get your Bitcoins sent quickly by the miners. That means sending $10 will cost you $30, if you want it done fast. Otherwise, it could take weeks or months for your transaction to go through. This means it is only realistic to send high amounts of Bitcoin. For a currency to be useful, it needs to have low transaction feest for any amount that is sent.

4. Since it is a decentralized currency, that means it cannot adapt to changing market trends quick enough (for example raising the cap to avoid deflation or resetting the blockchain to avoid the large size). A good currency can change the amount of currency in the market to fight inflation and deflation.

5. Since all transactions are public, no business will want to use Bitcoin, since no business wants all their transactions to be public. But wait, you were told that Bitcoin transactions are anonymous. This is pretty much true so long as people don't know your Bitcoin address. However, in order for a business to accept Bitcoins, they need to make their address public. And if they are doing business with other businesses that use Bitcoin, their addresses will also become public.
   As such, anyone could see who they are paying or being paid by and how much. Most, if not all, businesses that currently accept Bitcoin immediately convert them to the local currency.

Bitcoins only use is as a currency. And as a currency, it stinks.