The characteristics and advantages and disadvantages of BitcoinCurrency Features:
Decentralization: Bitcoin is the first distributed virtual currency that is entirely user-driven, without the presence of any central bank. Decentralization ensures the security and freedom of Bitcoin.
Global circulation: Bitcoin can be managed on any computer connected to the Internet. Anyone, anywhere in the world, can mine, purchase, sell, or receive Bitcoin.
Exclusive ownership: Controlling Bitcoin requires a private key, which can be isolated and stored on any storage medium. No one can access it except the user.
Low transaction fees: Bitcoin can be sent out for free, but a transaction fee of about 1 bit cent will be charged for each transaction to ensure faster execution.
No hidden costs: As a means of payment from A to B, Bitcoin does not have complex limits and procedures. Payment can be made as long as the recipient's Bitcoin address is known.
Cross-platform mining: Users can explore the computing power of different hardware on various platforms.
Advantages:
1.Complete decentralization with no issuing agency, and therefore it is impossible to manipulate the issuance of Bitcoin. Its issuance and circulation are achieved through open-source P2P algorithms.
2.Anonymity, tax exemption, and unregulated.
3.Robustness. Bitcoin relies entirely on P2P networks with no issuing center, making it immune to external shutdown. Bitcoin prices may fluctuate and crash, and many governments may declare it illegal, but Bitcoin and its massive P2P network will not disappear.
4.Borderless and cross-border. In cross-border remittances, funds go through layers of foreign exchange control institutions, and transaction records are recorded by multiple parties. However, if Bitcoin is used for transactions, one can directly input the digital address, click the mouse, wait for the P2P network to confirm the transaction, and a large amount of funds will be transferred. There is no need to go through any control institution, nor will any cross-border transaction records be left behind.
5.Difficulty for copycats to survive. Since the Bitcoin algorithm is completely open-source, anyone can download the source code, modify some parameters, and recompile it to create a new P2P currency. However, these copycat currencies are fragile and susceptible to 51% attacks. Anyone who controls 51% of the computing power of a P2P currency network can manipulate transactions and currency values, dealing a devastating blow to the P2P currency. Many copycat currencies die in this stage. The Bitcoin network is robust enough, and the CPU/GPU required to control 51% of the computing power of the Bitcoin network will be astronomical.
Disadvantages of Bitcoin
1.Fragility of trading platforms. While the Bitcoin network is robust, Bitcoin trading platforms are fragile. These platforms are typically websites, which are susceptible to hacking attacks or closure by regulatory authorities.
2.Long transaction confirmation times. When installing a Bitcoin wallet for the first time, it can take a significant amount of time to download historical transaction data blocks. Additionally, when transacting with Bitcoin, some time is needed to confirm the accuracy of the data by interacting with the peer-to-peer network, and the transaction is only considered complete after being confirmed by the entire network.
3.Extreme price volatility. Due to the involvement of numerous speculators, the exchange rate between Bitcoin and fiat currencies is highly volatile, making Bitcoin more suitable for speculation than anonymous transactions.
4.Lack of understanding by the general public, and resistance from traditional finance professionals. While active internet users understand the principles of peer-to-peer networks and recognize that Bitcoin cannot be manipulated or controlled artificially, the general public does not understand it, and many people cannot even distinguish between Bitcoin and Q coins. While the absence of an issuing authority is a benefit of Bitcoin, traditional finance professionals see such a currency as worthless.
