Cryptocurrency Pitfalls 2022

Updated: Apr 23

With the booming uprise in crytpocurrency integration for bringing society into a new wave of transacting, there are still many uncertainties that would cause any competent person to question the reliability of utilizing cryptocurrency as a main source of transacting for goods and services.

Original Article Date: 11 March 2022



Benefits of Cryptocurrency


Cryptocurrency has been around since about 2009 and started out with Bitcoin, which was said to have been created by a Japanese genius named, Satoshi Nakamoto. Since its inception into the financial arena, cryptocurrencies like Bitcoin, Dogecoin, Ethereum, etc., have played major roles in future trends on transacting around the world. With society having been accustomed to traditional paper currency for over one hundred (100) years to date, since the creation of the Federal Reserve Note [U.S. Dollar], a transition into the new digital currency has left many excited about the decentralization aspect of removing severe banking politics from the equation of purchasing goods and services. However, there are many who are still skeptical about the many potential pitfalls of utilizing cryptocurrency as a predominant and permanent means of transacting for things like food, clothing, and other basic life necessities.


Over the years, cryptocurrency has shown promising potential with its cryptography technology that makes it virtually impossible to be hacked. In addition, the peer-to-peer transacting method that allows each user of the blockchain technology that secures cryptocurrency for exchanging between two people, eliminates the hassle of traditional banking and the associated fees with having a bank account. The technology allows each user to be his or her own bank, while making secure transactions for products and services between the two parties. This gives people great reassurance that their purchases are secure and hassle-free, regardless of what they purchase through the blockchain.


Unfolding Pitfalls


With so many having become more dependent on the investment into cryptocurrency, as each crypto-unit purchased carries marketable value that can increase or decrease based upon current market trends, a lot of individuals are starting to realize the gamble involved with cryptocurrencies. The value of cryptocurrencies highly depends on current market trends and predictions (similar to the stock market).


There are more and more companies beginning to invest in the creation of new cryptocurrencies, which can easily devalue the market based upon over-saturation. There has yet to be determined an absolute cryptocurrency that stands out among all as the ultimate cryptocurrency that the entire world will use. This can be a good thing or a bad thing depending on the circumstances and the controllers of such cryptocurrencies...


Transaction Abuse


As of now, it has been determined by blockchain companies that cryptocurrency transactions cannot be reversed once an exchange has been initiated and completed between two people. Because of such a limitation, now people must be extremely careful on who they purchase from.


There has been an increase in fraudulent activity and scams pertaining to transactions. In recent reports, there are store owners who have cryptocurrency ATM machines, where people can purchase certain cryptocurrencies offered for a fee via ATM purchases. Customers who use the ATM machines can choose their digital currency of choice and purchase set increments of cryptocurrency to be sent to his or her digital wallet for future use. While in the wallet, the cryptocurrency can increase or decrease in value depending on the market trend shifts.


A recent problem that has been arising, is that store owners have been reported to be charging heavy transacting fees for cryptocurrency purchases. The fees have ranged anywhere from five percent, to as much as forty percent of the purchase amount. This, of course, can become very expensive for those who want to purchase cryptocurrency and who may not have access to traditional bank accounts (like many shady operations demand for purchasing cryptocurrency).


Overall, cryptocurrency has its benefits when responsible and entirely ethical people are transacting between one another. In a perfect world, no one would lose anything when using cryptocurrency for the purchase of goods and services. This is obviously not the case, as there are still way too many individuals, who are more than eager to defraud someone through an initially innocent cryptocurrency transaction, by means of abuse of knowing the cryptocurrency transactions cannot currently be reversed.


It has become a risky factor as to whether or not it is still even safe to consider centralizing cryptocurrency as a universal transacting method around the world.

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