7 Things Bitcoin Can't Do
Published January 11, 2014 12:50 PM
|
Updated October 20, 2016 10:16 AM
1 Min Read
Juan Pablo González
Bitcoin is gaining legitimacy as an alternative to cash and card payments, but for all its popularity, the digital currency has many limitations. Here are a few. (Image: ShutterStock )
VikZa/Getty Images/iStockphoto
Instant Payments
Though Bitcoin payments are fast, they are not instantaneous. It typically takes over 10 minutes to clear a transaction, which must be recorded on a public ledger called the blockchain. (Image: ThinkStock)
Chargebacks
Consumers can't unilaterally undo a Bitcoin transaction like they can a credit card payment. However, the Bitcoin protocol is being updated to better facilitate refunds initiated by the merchant. (Image: ShutterStock )
AndreyPopov/Getty Images/iStockphoto
Pay Taxes
Governments typically do not accept taxes in anything other than the official currency, but there are efforts to introduce bitcoin into the mix. E-Gov Link, for example, accepts bitcoins for parking tickets and other fees. (Image: ThinkStock)
Stockbyte/Getty Images
Money Laundering
Though there are concerns about criminals using bitcoins to launder funds, the digital currency is a bad way to cover one's tracks. Since each transaction is recorded publicly, Bitcoin users are establishing a trail that anyone can follow. (Image: ThinkStock)
Rupert King/Getty Images
Mortgages
A few homes have been listed for sale in bitcoins, but buyers must have the funds on hand. Regulatory issues and the volatility of Bitcoin's value preclude mortgages priced in the virtual currency. (Image: ThinkStock)
Matthias Haas/Getty Images/iStockphoto
Lend Money into Existence
Because there is a fixed supply of bitcoins, it's impossible to simultaneously store a bitcoin in a blockchain address and lend it out, as banks do with deposits. However, firms could issue IOUs for bitcoins , which could then be used as a method of payment. (Image: ThinkStock)
FRANCIS SPECKER/BLOOMBERG NEWS
Avoid Infringement Claims
Many digital currencies have been built on top of the Bitcoin protocol, including the infamous Kanye West-themed Coinye. West sent a cease-and-desist letter to Coinye's developers, prompting Coinye to change its mascot to a "half-man-half-fish hybrid " that still bears a passing resemblance to the celebrity who inspired it. (Image: Bloomberg News)
