Why are some Countries Reluctant to Adopt Cryptocurrencies?
After a remarkable debut in 2009, Bitcoin has gone through major ups and downs to gain acceptance in many countries all over the world. There is no doubt that cryptocurrencies have opened up the ways of successful investment opportunities for traders and investors but many countries, including China, Russia, Brazil, and Thailand, have banned cryptocurrencies and considered them as an illegal mechanism of conducting transactions. In addition to this, some tax authorities, enforcement agencies, and firm regulators raise questions on the legality of cryptocurrencies.
As Bitcoin is a decentralized digital currency and it does not exist in any physical form that is why this peer to peer currency is not acceptable in many states of the world. Regardless of the increasing fame of this decentralized currency, it is still unable to gain the trust of many governments because of its decentralized and volatile nature. The countries which have banned the use of Bitcoin prefer their banking and financial system for trading purposes across borders. Furthermore, governments want to uphold a regulatory check on transactions and trades initiated from an individual account. For instance, the Bank of Thailand has issued a financial statement in which it has asked several institutions not to engage with any Cryptocurrency. The reason behind this act of Thailand’s government is to reduce money laundering and support of terrorism.
Reasons Why Certain Governments are not Accepting Bitcoin:
No doubt Bitcoin and other cryptocurrencies have influenced and impressed the worldwide business community, but there are certain down points to it as well. The lack of trust and transparency surrounding cryptocurrencies is a concern for governing authorities. This is why Russia has also banned the use of this digital currency in the state to prevent Funding for terrorist activities and money laundering.
Moreover, the economic risks and manifestations closely related to digital currencies have enabled well known countries to give up on Bitcoin. In addition to this, the fear of crimes and scams with digital payments has restricted the use of cryptocurrencies to a greater extent. The parliament and cabinet of Russia, Thailand, Brazil, and other countries regularly call notice on the activity of digital currency in the respective states. Even with the high profit potential, many countries deem cryptocurrencies unfit for a long term financial solution.
Alternative to Bitcoin in Many Countries:
it is quite evident that no country affords to lag in the race of advancement. That is why they have made efficient alternatives to Bitcoin for fulfilling the demand of investors and traders. Many countries are developing their own version of digital currencies to compete at an international level. China has issued state-backed digital yuan, which is providing golden opportunities for investment in digital currency. It has enabled people to earn considerable profits and carries a great potential for growth in the near future.
Unlike China, Digital Ruble is used in Russia, Central Bank Digital Currency (CBDC) is used in Thailand, and Brazilian Real is used in Brazil as the best alternative of cryptocurrencies. These methods are not on the level of Bitcoin, or other such popular cryptocurrencies, but they have a promising future in front of them.