Inconveniences of Buying Bitcoin

When you start investing in bitcoin, you won’t be buying cryptocurrencies right off the bat. No matter ProfitiX Broker which kind of trading method you use, you’ll still find it difficult to buy bitcoins even when you use credit cards or even PayPal, wherever you are in the world.

Exchanges avoid those payment methods

Exchanges usually require users to connect their bank accounts instead of using credit cards or PayPal. A larger number of sellers tend to be on their guard when doing such transactions. They also usually prefer to use hard cash.

The reason is chargebacks.

The transactions you do with credit cards or PayPal can easily be reversed if you call the company that issues the card. However, bitcoin transactions are irreversible and you may find it extremely difficult to prove that any good changed hands in the transfer of bitcoins. Overall, this payment method is avoided.

Legality Problems

There’s no doubt that bitcoin is a magnet of law enforcement Profitix Broker Review agencies, tax authorities, and legal regulators. All of these legal entities try to figure out how bitcoin fits into the already existing frameworks of the laws.

When it comes to legalities, it’s a good idea to see if bitcoin regulations and rules apply to the region or country where you live. Also, check out what transactions are allowed and which ones are not.

However, the general rule remains true wherever you are: avoid buying anything illegal (regardless if it’s done with bitcoin), and you’ll be okay.

Where it’s legal and not

It’s been almost a decade since bitcoin launched, so there have been government actions taken about it.

For instance, bitcoin is considered illegal in Vietnam, Iceland, Bolivia, Ecuador, Kyrgyzstan, and Bangladesh.

Some other countries are currently not taking any position about bitcoin and other cryptocurrencies in general.

Russia has initially banned bitcoin along with other digital currencies, but it reversed that decision shortly after the outlawing crypto. Russian authorities have also recently considered officially recognizing bitcoin and all digital currencies in order to fight illegal transactions.

Protection Risks

In general, exchanges and wallet services still don’t have the same level of protection that banks can provide, in spite of the proof of identity requirements and other security measures they impose.

For instance, take the case of now-defunct Chinese exchange Mt. Gox. It officially filed for bankruptcy protection and admitted that it couldn’t retrieve the stolen 750,000 bitcoins of its customers.

This shows that exchanges’ insurance for customers are very limited—if they exist at all. And since there is still no solid guidelines or laws when it comes to cryptocurrencies and their theft, authorities usually aren’t clear about how to approach the matter and the crimes related to it.

Larger exchanges have been able to replace their customers’ funds after an incident of theft, but at this point in time they’re not really legally obliged to do that.

Lastly, if the theft arise because of negligence on the user’s part (forgetting the keys or losing copies), there’s really no guaranteed way of getting the funds back.

Clarissa Cooke

Clarissa Cooke