Negative Effects of Cryptocurrencies

The word cryptocurrency brings up many questions in a common man’s mind. Are these currencies safe, are they legit, what will happen if I invest in it, what are the different scams in the market and many more. Cryptocurrency though about a decade old are fairly new and different compared to the traditional currencies. It is not identified as a legal token by any of the governments rather many of the countries are against using it. But, even among all these negativities, the cryptocurrencies are becoming more and more popular with every passing day. No matter what the future has in store for these currencies here are some negative traits that these virtual assets display.

1) Drastic impact on the Planet: This might sound weird but the cryptocurrencies are impacting our planet drastically. The cryptocurrency mining is the most important method of creating new blocks of cryptocurrency. This mining is a highly complicated process where a network of computers is used to solve complicated mathematical problems and when solved a new block is added to the blockchain. This uses an enormous amount of energy to keep these computers running causing an enormous amount of pollution. Many leading countries are part of this network and also have a huge contribution to the creation of this currency. These leading countries, even after being aware of the side effects are not helping to stop this impact.

2) Money laundering: Cryptocurrencies has not only provided an easily decentralized method of payment for the common man but has also helped many perpetrators to launder their money easily. These currencies are decentralized and hence it is impossible to trace back to the original owner of these coins helping people to convert their illegal money to legal currencies without getting into trouble with the law. These currencies are completely digital assets and hence it is impossible to trace anyone once they are hidden behind the huge cyber web.

3) Exchange and Trading scams: The uncertainty in this highly volatile market has given birth to many scams and frauds and many investors have lost their hard earned money in these scams. Many exchanges that were used to trade these cryptocurrencies have closed down suddenly and vanished from the market along with huge amounts from the investors. Similarly, the trading software like Crypto Trader is turning out to be different than the investor’s expectations. It is highly recommended to go through all the reviews before trusting any software or exchange if you do not want to lose your money.