I just checked the Bitcoin price and saw Bitcoin dropped down to $3,806.93. It is a steep drop from when I saw Bitcoin was up near to $5,000. This has happened because Chinese government is stepping up in regulation for Bitcoin. Rumor or not, Chinese government is banning several major Chinese Bitcoin exchanges and stopping groups in China to create new virtual currencies. Since such news have come out of China, Bitcoin has continued to slide downward. It got rebound a bit, but it’s not yet over $4,000.
People are believing in Bitcoin for several reasons. One important reason they believe in is that other governments won’t ban Bitcoin and so Bitcoin could survive outside China and around the world. Other reasons are that Bitcoin won’t be controlled by governments, and so people can actually surpass the governments’ scrutiny when making financial decisions. Unfortunately, Bitcoin has too many reasons for the governments around the world to step up to regulate.
I believe that China is a very powerful market factor, because China has the power to persuade other governments to step up their own Bitcoin regulations. This is why I think Bitcoin won’t survive in the long run! Of course, that’s my belief, and so I could be 100% wrong! Don’t take my belief as fact, because you need to do your own research and soul searching whenever it comes to financial decision. If you’re investing in Bitcoin and believing in Bitcoin, then you should just do what you think it’s best for you!
Anyhow, I like the idea of Bitcoin, but Bitcoin has several weak points that make me feel so uncomfortable about it. Two most important weak points about Bitcoin are governmental factor which I had mentioned, and the other one is how easily Bitcoin could disappear. What do I mean by this? Well, let’s say I believe that Bitcoin coins are not actually safe on your devices. Computers’ storages could get corrupted and poof your Bitcoin coins would disappear. Hackers could just hack into your network or your smartphones and poof your Bitcoin coins would disappear. No electricity or battery power, well you can’t really use your Bitcoin coins until the power is back.
In short, Bitcoin is much harder to get refund or recover once the coins leave you for good. There is no institution to make sure the transaction is just, and the transaction always depends on pure trust without any insurance. Once the governments start to ban Bitcoin together at large (i.e., worldwide), it makes Bitcoin users to lose the ability to appeal to the authorities for transactions gone wrong. This weakens the Bitcoin’s appeal by a lot I think. The things that make gold, hard physical asset, more appealing are values that can be verified and redeemed in the eyes of the world. Bitcoin lacks the redeem attribute! In my eyes, Bitcoin does not have the shine of gold, because you can’t redeem Bitcoin on justification but on pure trust!