Bitcoin has come a long way since its creation almost eight years ago; however, there is still a long way to go before the digital currency becomes a widely used method of paying for goods and services. Here are seven of the biggest challenges facing the mainstream adoption of bitcoin:
- Volatility — bitcoin has proven to be extremely volatile, and this does not appear to be slowing down. This increases its popularity among speculators but is not helping its appeal as a currency.
- Ease of use — although it has become easier to buy, sell and use bitcoin in the past several years, it has yet to become user-friendly enough for mainstream adoption.
- Widespread acceptance — although some retailers, especially online retailers, allow consumers to pay using bitcoin, the cryptocurrency is still not widely accepted enough for mainstream use.
- Potential for theft — knowledge of how to use bitcoin requires significantly more effort of the part of users, hurting its appeal to a mainstream audience.
- Reputation for criminal activity — Bitcoin, as an anonymous payment source, has earned a reputation as a tool for money laundering or the purchase of illegal items. This has hurt its ability to obtain a broader appeal.
- Tax issues — bitcoin is considered by many taxing authorities as an intangible property rather than a currency, meaning the tax situation around it can become very complex very quickly.
- Scalability — the underlying technology behind bitcoin means that, as it become more widely-used, the slower the network used to process transactions will become.