Crypto-optimists see Bitcoin as a magic bullet against all the problems of the traditional financial system. And yet, the flagship of the cryptocurrency market is not without flaws, which are methodically pointed out by crypto critics. But people tend to ignore any flaws in any object they admire, whether it’s an investment asset, a favorite brand of car, or a popular singer.
Why get out of the information bubble?
People tend to surround themselves with like-minded people. There is nothing wrong with this, but exactly as long as the circle of friends does not begin to acquire the features of a circle of fanatics. But this transformation is greatly facilitated by modern information technologies and search algorithms. They kindly bring the user exactly the information that is interesting and pleasant to him. Ultimately, a person has the illusion of an ideal world.
While optimistic crypto investors are waiting for the next bullish rally and calculating the expected profit, crypto critics methodically keep statistics on the failures of the crypto industry. In fact, no one calls for abandoning Bitcoin, immediately withdrawing all orders for the sale of USDT to BTC and leaving again for fiat. All you have to do is take off your rose-colored glasses and treat Bitcoin a little more soberly.
Why is Bitcoin criticized?
It turns out that even the dollar (well, Bitcoin) is not liked by everyone and not always. What are the main claims to the main cryptocurrency and how justified are they?
Creator anonymity
“If nothing is known about the development team, it is better not to invest in such a project.” Don’t you think it’s strange that rule #1 of financial security as applied to cryptocurrency #1 is almost completely ignored. But nothing is known about Satoshi Nakamoto, except for a pseudonym.
Low network bandwidth
The Bitcoin blockchain can only process about 7 transactions per second. To meet the needs of a growing number of market participants, this is catastrophically insufficient.
High level of speculativeness
BTC appeared against the backdrop of the global financial crisis of 2008 and was announced as an alternative to traditional money. But instead, it has become a speculative tool on which traders earn.
Inefficiency
As conceived by Satoshi Nakamoto, BTC was supposed to become an ideal payment system, but for some reason limited the issue of coins. Deflationary assets are generally not very suitable for everyday spending, and even more so if they are so highly volatile.
High level of centralization
The alleged decentralization of Bitcoin is no more than a naive dream. More than 30% of BTC is concentrated in the hands of large investors, which means that they can control the market if they wish.
Not everything is so rosy with mining. Solo mining is no longer relevant, it has been replaced by mining pools. At the same time, more than half of the hashrate falls on two pools, namely AntPool and Foundry USD.
There are more powerful projects on the market
Critics of bitcoin note that since its inception, more technologically advanced and perfect projects have appeared on the market. Among them there are those that perform the role of money much better. Despite the popularity of questions like: “Is USDT safe?” – the convenience of using stablecoins is more than obvious.
Correlation with the stock market
Observations show that Bitcoin price dynamics correlates with the stock market. Both markets depend on the same macroeconomic factors.
High fraud rate
However, this does not only apply to Bitcoin. Fraudsters find opportunities everywhere and all the time. But the young, little-studied and, most importantly, almost anonymous market is just an ideal environment for attackers.
Negative impact on the environment
The Proof-of-Work algorithm is very disliked by environmentalists. PoW is very energy intensive and harmful to the environment. Therefore, messages about initiatives aimed at banning mining periodically appear on the network.
