Usage Bitcoin in payment of trade decreased significantly in 2018, even as the encryption most popular world reached one of the basic features of any currency What: stability.
Bitcoin value was exchanged between the largest payment processing world fell nearly 80% from January to September, Reuters citation from research firm blockchain Chainalysis said. This represents the pre-coding is struggling to mature from asset classes speculative tool to replace seriously currency issued by the state.
Bitcoin can be used for cross-border money laundering
Virtual money traded between individuals with each other, instead of through the banking system. People use virtual money for many different purposes and do not know how many of them use virtual money for illegal activities. Currently, the Bank faced with the strong development of the payment system from virtual money to electronic payment platform Alipay or an electronic wallet as M-Pesa of Kenya.
Cash payment is still unpopular
Cash is not the traditional method of payment through the Bank. This is the oldest type of payment and difficult to change. Although the method of payment by credit card, debit cards, and smart cards are not exposed (contactless card) are growing strongly, most people still often use cash. The people with the cash are comfortable with the familiar and reliable. The Mexican drug kingpin is an exception when making cross-border money laundering by Bank banknotes.
Cash transactions had been the pillar of the banking industry from personal customer service to small business customers. This gradually changed as banks focus on the electronic payment method that encourages managers to use. In Britain, a debate broke out between the Bank and the party machine to withdraw money free of charge by the Bank pay to the customer the amount less withdrawal each time.
However, withdraw money directly from a bank in difficulty do not make people stop wanting to use cash. In a recent speech, Mrs. Victoria Cleland, head of the customer service and cashier of the Bank of England, admitted that the cash is still a difficult problem. The total value of cash in circulation in the UK increased by 10% in the last year, it was the fastest increase rate within a decade. As banks use complicated payment methods then the more people use cash.
This situation makes us recall the rise of the shadow banking system in the early 2000s in the UK while managing credit lending lose. Meanwhile, payment systems underground, electronic payments through banks and other forms expanded. The non-cash transactions such as using a credit card or debit card increased by about 11% per year, the check is no longer favored anymore. The popularity of these cards and payment methods contactless smart (contactless payment) make payments become more convenient. This enables banks to easily control money laundering.
Technology is not enough?
Many months of price stability after a powerful explosion in the winter prices in 2017 boosting hopes that the last Bitcoin can be widely used in payment. This capital was its original purpose. Many characters in the financial sector and the pre-coding has been trying to find ways to improve technical infrastructure, help Bitcoin become the payment method.
"Bitcoin will need stability if it wants to become a form other currencies. But points will really help Bitcoin is widely used is the ability to scale: Is it possible to handle the value or volume of transactions that currency so often handled or not? ", Strategist Joni Teves UBS in London shares.
Blockchain technology, where all activities are recorded Bitcoin and authentication, can only handle a small portion of the transaction that the major credit card carriers perform in a second. This fact makes the application of Bitcoin in payment is not possible.
And yet, despite prices Bitcoin stabilize in recent months, even more, stable than the US stock market, the value of payments in Bitcoin has plummeted from 427 million dollars in May 12.2017 to 96 million in September, according to Chainalysis. The company surveyed 17 firms handling Bitcoin payments, including US-based BitPay. BitPay is one payment processing firms with the largest Bitcoin.
Most sellers accept Bitcoin does not directly receive money encryption, which uses the middleware services such as Bitcoin BitPay to transfer real money. Comprehensive data on the use of Bitcoin in payment is unclear because transactions between Bitcoin and other currencies is usually charged to general and commercial payments.
The data for each firm by Bitcoin payment processor plunge reflects trends. For example with Coin payments based on Vancouver (Canada), the transactions to and more than halved from January to October, according to the analysis blockchain OXT page. Director of technology strategy Sokolin global financial research firm Lex Autonomous Next said: "Activity Bitcoin payment processing is decreasing slowly but consistently."
Not done much after 10 years?
In the first decade since its inception, Bitcoin attracts different investors. Some people believe that it could reshape global finance by replacing the traditional means of payment. Some of them just buy Bitcoin as prices soared to reach 20,000 USD late last year.
Since then, Bitcoin has lost 1/3 of the value. 20:11 Yesterday, it fell to 4,200 USD, the lowest level in over a year. Many food businesses should make money from fever encrypted Bitcoin prices also plummeted. For example, shares of Nvidia chip design firms slid last week after the announcement of the business results showed that chip inventories also many post-mining boom precoding.
The relative stability in prices Bitcoin has not raised this year it is expected both personal and business use extensively for payment. Britain's Coinbase CEO, Mr. Zeeshan Feroz, said: "Out of volatility is a step in the right direction, started to help Bitcoin has the ability to use outside retail segment."
However, the big financial firms and entrepreneurs are pre-coding elements that price stability is not enough to Bitcoin is accepted. Bitcoin to faster, cheaper. In addition, the specified, explicit management will also help users to feel it more legitimate.
While regulations, managing a matter of the distant future, the efforts to improve the ability to expand the scale or the number of network Bitcoin transactions processed per second, is underway. Lightning network code (lightning network) is being added to blockchain Bitcoin, make payments faster, cheaper. The lightning network is growing both in terms of capacity and use.
This week, hitting a record 4,101 network node or computer software to run, according to data that the airline General 1 ml. This figure shows increases over 25% from August. For bitcoin users or lightning network popular because it allows them to send money to each other quickly instead of having to complete time-consuming capital transactions on the blockchain.