X Infinity: Limitations of Cryptocurrency Transactions
There are now over 1,600 cryptocurrencies. These vary from tokens supporting infrastructure protocols to coins for use in various applications. The number of tokens in play means that there is more complexity. This article outlines the disadvantages of cryptocurrency adoption.
In practical terms it makes it harder to use cryptocurrencies in the real world. The number of cryptocurrencies make it harder for merchants to accept a broad range effectively. There are several cryptocurrency wallets that vary in storage power. Some wallets are unique to storing a single cryptocurrency, such as Bitcoin Core Wallet that stores BitCoin, and MyEtherWallet that stores Ether. There are also multi-coin wallets, such as Coinomi that can store up to 154 cryptocurrencies. The constant introduction of new cryptocurrencies means that merchants will have to endure the tedious task of acquiring multiple different wallets just to hold their cryptocurrency revenue.
The volatility of cryptocurrency prices make it harder for merchants to adopt. Cryptocurrency prices fluctuate dramatically because the market is small. Let’s take BitCoin into consideration, the most iconic cryptocurrency. There are currently 28.5 million BitCoin wallets that hold more than 0.001 BTC, which is equivalent to a mere 0.375% of the world’s population. In a market of $630 billion, a few million bitcoin owners can significantly shift the price of BitCoin. [https://www.bitcoinmarketjournal.com/how-many-people-use-bitcoin/]
There are no major markets for some cryptocurrencies which make transacting difficult. So far, only USA, Canada, Australia and The European Union have made cryptocurrency legal [https://www.investopedia.com/articles/forex/041515/countries-where-bitcoin-legal-illegal.asp]. The concept of cryptocurrency is still fairly new therefore some countries have not developed regulations for this market. Merchants in these countries would not want to risk accepting cryptocurrencies prior to the implementation of cryptocurrency regulations. Find out more at http://www.xinfinity.io.
