What are the advantages of Bitcoin over fiat?
Since the beginning when cryptocurrencies first started to appear in media, Bitcoin has received a lot of critique and at an early glance it can be difficult to grasp what makes it so valuable to the early adopters. Consumers love Bitcoin for many different reasons but there are certain aspects of it which I find make it especially admirable.
1. No banks
The most commonly mentioned reason is the decentralized structure on which Bitcoin stands. Decentralization is an essential part to almost all blockchain based applications and currencies. It’s the reason why Bitcoin won’t allow for banks to take financial power from the people. There are many reasons why banks are feared such as fractional reserve banking which is a practice where banks only are held responsible for a certain percentage (usually 10% or less) of the funds they have on loan. What this means is that they don't legally have to hold all the money they borrow from you, hence you theoretically can be refused from taking out all your money when needed. Bitcoin allows for you as an owner to not have to rely on any person nor company but only yourself.
2. Fast transactions with minimal cost
Even though Bitcoin has been struggling with its scalability and transaction speeds, it has the potential to become by far the most efficient form of payment. There’s already other cryptocurrencies out there which are almost instant and/or feeless (Even though this comes with negative effects such as DDOS attacks) however even Bitcoin defeats most fiat transactions. If you as a private person wants to send, let’s say a million dollars, to someone in another continent, then not only would it be close to impossible to do this the traditional way due to laws and regulations by banks but if it went through it would still take a couple of days. However with Bitcoin you can transfers millions of dollars in a matter of minutes (Depending on how busy the system is).
3. Simplicity, portability & ease of use
Unlike creating a bank account which can be a tremendous hassle, making a wallet is free and only takes a couple of seconds. Once the wallet has been created you are free to send and receive as much Bitcoin as you wish without any fat wallet filled with paper based cash that withers and breaks over time.
4. Protection of privacy
Bitcoin transactions do not reveal the identity of the person who does the transaction, however all transactions are transparent since the public ledger records and shows all transactions and this can be found using the wallet address. This has caused several other cryptocurrencies to come up known as privacy coins which aim to provide consumers with completely anonymous means of transactions. Some of the most famous privacy coins are Monero, Dash and Zcash.
5. Freedom
The main reason Bitcoin appears more adequate to me and a large portion of people is the aspect of freedom. Nobody but the owner controls what is done to their bitcoins. Nobody can freeze, limit or stop you from paying and/or receiving currency and this truly intrigues the libertarian part of me which admires the fact that Bitcoin allows me to control and do as I please with the money I have.
Conclusion
Whether or not Bitcoin will become the coin that we all use at a day-to-day basis is left to be determined, however the technology that stands behind it and the advantages that it provides its adopters with are impossible to ignore. I truly believe that we are going to see a paradigm shift towards something with a similar-based structure in the near future whether that is Litecoin, Ripple or something that has yet to surface.
Legal disclaimer: This is only my personal opinion, make of it what you wish. What does this mean? It means it's not advice nor recommendation to either buy or sell anything! It's only meant for informative and entertainment purposes.
Best regards,
Nicholas Stael von Holstein
Starflow