Technology Major weakness of bitcoin
I share my view about the major weakness of bitcoin.

a) It is built on the distributed ledger. The entire ledger is sent out to the miners to validate the transactions. This is an inefficient way to manage the platform. It can handle a limited number of transactions. I read somewhere that only 5 transactions can be managed every second.

b) It uses a lot of energy to calculate an algorithm to identify which miner is entitled to the prize. This consumers a large amount of energy.

c) As the number of coins is limited and the demand is very high, the price of bitcoin has increased to an insane level. This is a speculative bubble and ponzi scheme. It is not sustainable.

d) Due to the volatility of the price, it cannot be used as a digital payment. The transaction cost is also very high.

I think bitcoin will crash in due course, especially if the governments ban its use. China has taken the first step. Other countries may follow.

Tan Kin Lian
 

Add Comment

---