Bitcoin banking and challenges
It is always debatable to integrate cryptocurrency and especially Bitcoin with traditional banking. an inherent characteristic is the main subject and it can challenge traditional banking that is why I said it is a debatable topic. Things are stopping Bitcoin banking so the first thing is volatility and the absence of regulatory oversight However decentralized finance can solve this.
As I said first big challenge is bitcoin volatility Against Fiat currency, Bitcoin fluctuates more in the short term of period. And for this volatility, there are multiple reasons behind this such as speculation, market sentiment, and limited liquidity compared to the traditional market. Loan, deposit, and security everything is difficult to set along with Bitcoin because it’s a highly volatile currency.
Bitcoin is praised as a revolutionary value of store and it is also called digital gold. There is a saying that Bitcoin should not be taken as a currency but it will be taken as a hedge which means we can call it an asset.Banks need control To manage the banking system but Bitcoin has a decentralized nature which is why no one can control the Bitcoin transactions bitcoin is decentralised and transparent. Also, the bitcoin market is unpredictable. But it has a solution as defi. Defi works on blockchain technology.
Defi works without intermediaries. With the help of smart contracts and decentralized applications (dapps), it can provide a flexible and inclusive financial system. So the thing is Defi can help to integrate Bitcoin and cryptocurrency with traditional finance and that is why decentralized finance is very important now we have the option to take the full benefit of Bitcoin in the banking system but as you know the government does not want this because according to them Bitcoin is a threat for the fiat.
And somewhere it is true but it is also true that you cannot stop Bitcoin because it is decentralized and it is developed for the people people will use it and people will manage it so now the world’s government needs to understand Bitcoin and cryptocurrency and focus on fair regulation policy that can help this industry to grow. Decentralization is the backbone of this technology so you cannot remove the decentralization from the cryptocurrency because without it it is nothing.
Decentralization differentiates cryptocurrency from Fiat you have seen that most governments talk about blockchain technology but ignore cryptocurrency because of its decentralized nature of cryptocurrencies and they call them private digital assets so now it is up to you what you describe from this information Bitcoin can grow without regulation because of its decentralized nature and decentralization is very important I hope you found this post helpful and I will appreciate if you share this post or social media like X, Instagram, and Facebook also reblog of this post I will meet you in my next blog till then take care do not forget to share this post as I said. Have a good day Now Faiz Makrani signing off.
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