Bitcoin is a peer-to-peer, decentralized electronic currency. It has no regulatory organization or issuing authority. The public database on the Bitcoin network is fault-tolerant and immune to corruption, and it runs on a cryptographic protocol.

The network runs without a central database or administration, and transactions happen directly between users. 

Potentials of Bitcoin 

Its value and user base have considerably increased since its creation. Most retailers and websites now accept it, and investment in the currency has increased significantly.

Online marketplaces like coin desk, zebpay, and others offer an auction system for buying and selling it.

Because it is now more difficult to mine the coin, sophisticated hardware is being used. Additionally, this competition returns less profit, which is a disadvantage.

Advantages 

Here are some of its advantages:

Protection from payment fraud

It makes use of cryptographic protocols and an algorithm. They are therefore impossible to copy.

Reduced possibility of identity theft

Transactions made with bitcoin are fully anonymous. Neither the sender nor the receiver of a bitcoin transaction needs to provide any sensitive information or personal information.

It aids in avoiding identity theft. Credit or debit cards use a “pull” process in which they ask for your login information, start a transaction, and then withdraw money from your account.

With a push system like Bitcoin, you can send any amount to the recipient at your discretion.

Immediate settlement

With Bitcoin, there is no middleman to handle the transactions. Once launched, funds cannot be placed on hold or returned; they are settled immediately.

Greater liquidity 

In contrast to other cryptocurrencies, bitcoin retains most of its value when converted to other real-world currencies.

Independent

It is not governed by any political or governmental entity. It doesn’t have any political sway. It cannot be frozen or seized by any authority or government.

Security

Because of bitcoin’s extremely high security, it is impossible to forge or manipulate bitcoins or the bitcoin payment network. There will ever be 21 million bitcoins. In comparison to other real-world currencies, it gives bitcoin worth a long-term guarantee.

Disadvantages 

You can find below some of its disadvantages:

Scams and frauds

It is technically complex and not simple to comprehend for the average person. It leads to in the name of investing in, saving, and doing other bitcoin-related transactions. It is being sold on fake websites and apps that also pose as humans.

Black market activity 

It is often used by criminals and on the black market. It is also utilized in computer hacking, drug deals, and black-market arms deals because of its complete anonymity characteristic.

It is more difficult to stop bitcoin-related illegal acts when there aren’t currently adequate laws and authorities in place at the international and national levels.

Price volatility 

Bitcoin’s value soared after the FBI said it would treat it like other legal financial services. when there was a security breach in MT. Gox bitcoin exchange saw a more than 50% decline in bitcoin value. It is challenging to invest in bitcoin because of the price fluctuation.

No refund

It cannot be retained or refunded after a transaction has been started and completed. Without a middleman, it occurs directly between users. Therefore, bitcoin cannot be sent back.

Future cryptocurrencies 

Future cryptocurrencies that can address bitcoin’s drawbacks while maintaining a more secure network may eventually replace it.

Cyber hacking

Bitcoin is used as a payment method by criminal ransomware and hacking to demand money from their victims. Due to the anonymous nature of bitcoin, this renders them untraceable.

Piracy 

Bitcoins are essential to the operation of pirated file-sharing networks.