What Are the Risks of Bytecoin?
Before you invest on
any coin, you should made some
consultations and obtain advice so as to decide if the potential returns on
your investment overweighs the risks.
Historic performance and success stories do not guarantee the future returns in
cryptocurrencies trading. Generally, investing in Cryptocurrencies are highly
speculative and involves significant risks such as vulnerability to hacking,
highly volatile and capital loss. Bytecoins distinguish itself from other cryptocurrencies
in terms of security, financial privacy and
protection. Bytecoins Investment is like other cryptocurrency or foreign
exchange investment. You purchase your BCN when the price is low and sell the
price appreciates. Historically, Bytecoin price fluctuates regularly and you
can never be sure of the actual price. You experience increase in price today and decrease in price tomorrow. This
instability has created fears in the heart of traders and this has made
investors/traders to be inquisitive on what the “Risks of Bytecoin” entails
before joining Bytecoin. Below are some risk associated with Bytecoin.
Danger of losing the private keys: Private keys which are
also known as secret keys is an integral component of cryptography that is used
with an algorithms to decrypt and encrypt
code. It allows a user to have access to his or her cryptocurrency. It security
build up help user to protect their wallet from unauthorized access to their
funds and theft. All cryptocurrencies including Bytecoin rely on the digital
wallets that store the secret keys. Users may lose access to their wallets if
they forget or lose their passcode to their wallet. This is one of the reasons
why users should are advice to use passcode
that they can easily remember and ensure they are well protected from third party. Digital wallets are not exempt
from getting lost as well. Users tend to lose their Bytecoins if the computer
with the digital wallet installed get lost together with the wallet or the
smartphone with the wallet is misplaced. Bytecoins
could also get lost if the system storage where the wallet is stored is
formatted. In order for users to prevent their bytecoins
and wallets from getting lost, it is essential to have as many backup for your wallet as possible. You must
get yourself updated with your wallet status and maintain it at all time. To
make this easy to achieve, you can obtain a lot of hardware drive wallets and
keep one under lock and key either at home or in the bank, and also ensure that
the computers are in good condition all the time with adequate monitoring.
Traders who deals with Bytecoins and
other cryptocurrencies always designates
a high performance and standard computer to handle each coin accordingly.
Attack: Bytecoin founders argue that their system is well encrypt and therefore, it is not vulnerable to
cyber-attack. It will be difficult for any hacker to penetrate easily and steal
the coins of consumers because according to the brain box behind Bytecoin, the
process will need a lot of costly electricity and the computing power of data
processors. They forgotten hackers can explore at any length in order to
achieve their aim.
In December 2017, there was a gigantic fraudulent
attack on the Bytecoin’s network which
resulted to the heavy loss of consumers’ coins from their respective wallets,
exposing the power between the Crypto Note-based coins and damaging the
Bytecoin network. Bytecoin experienced this cyber-attack in the period when the
rate of Bytecoin was experiencing great
increase in its coins. The basis of the Bytecoin software and power of the
cryptographical technology which it was designed proved that it’s impossible
for anyone to attack the network or pilfer someone’s coins. Although,
consumers’ couldn’t find their coins in their wallet due to the inability of
the desktop wallet to synchronize which is as a result of the attack.
being scam: Cryptocurrencies is the
latest in the world now and it is fast moving with publicity that everybody
wants to be involved in it. No matter how secured a scheme is, scams will still
thrive especially in the heart of those with little or no knowledge on
cryptocurrencies. Everybody wants to be in the record book of cryptocurrencies
but most do not understand how the cryptocurrencies work. Some get lured to
invest money with some companies with the
promise that they will get ROI (RETURNS ON INVESTMENT) on their money within short period. Some people register on websites
and started trading just because they want to be part of Bytecoin stories.
Hardly can Ponzi schemes be differentiated from cryptocurrencies because the
latter is a wide network and it operates in the highest possible anonymity.
Scams can discourage many people from participating in Bytecoin because people
are sacred of losing their hard earned money to fraud. This can further pull
down the value of Bytecoin and make it irrelevant in the cryptocurrencies
regulations: Cryptocurrencies activities and it operational mode in the world
business market pose a lot of threat to the governments. One of the target of
governments is to build up industrial and enterprise growth in order for
dividends and income generation to grow but Bytecoin and other cryptocurrencies
has been seen as an antagonist to this target. Bytecoin activities do not
create employment opportunities for people because there is no room for
intermediary between the seller and the buyer since it activities take place
online. Transactions charges on Bytecoins are very low because no
intermediaries are involved. This trading activities hinder banks from
generating income because transactions being made with banks generate multiple
ripple effects through the bank growth, empowerment, employment, investment
activities, and tax to the government. The Governments therefore seek a move to
modify cryptocurrencies mode of operation by declaring Bytecoin and other
cryptocurrencies a tax asset with the introduction of tax, and also limiting the
extent to which Bytecoin operate.
This implication of this is that the modern rapid appreciation
of Bytecoin and other cryptocurrencies is likely to depreciate and move down
the trend the moment these laws are introduced. Bytecoins will definitely get
regulated at long last just like Foreign Account Tax Compliance Act (FATCA) had
far-reached implications after the 2008/2019 global recession. In view of this,
experts and analysts have advice people not to put all their eggs in one basket
when they are dealing with Bytecoin network alone. Instead, they should explore
other crypto assets carefully and invest wisely without cutting links with the
What Happens if Bytecoin Gets Lost?
Different reasons are associated with the loss of
Bytecoin from owner’s wallet and this may be due to the carelessness from the
owner, Bytecoin system malfunctions or fraudulent attack on the Bytecoin wallet
from hackers and scammers. The following are the common ways that people lose
#Carelessness from the owner: Loss of Bytecoin
occur when the owner of the Bytecoin mistakenly or carelessness link his wallet
login to the public (i.e third parties). This careless act will enhance easy
penetration from third parties into the Bytecoin owner’s wallet and the
Bytecoin can easily be diverted and move away from the wallet. You must ensure
your log in well secured and save from third parties because Bytecoin lost due
to this reason may be difficult to recover.
#Bytecoin system malfunctions: This normally occur
when some software updates occur on your computer. You may lose your Bytecoin wallet
in this process but you can still retrieve your coin back to your wallet when
you reinstall the Bytecoin wallet. Retrieving of coin can be achieve in the
##If your Bytecoins are stored in the wallet that
you have backup initially, then you can use it this
##Also, you can use the Data recovery exercise
which has to do with recovery from the original wallet. This is possible when
deletion occur from the memory stick/SD card or deletion of a hard disk.
#Fraudulent attack on the Bytecoin wallet from hackers
and scammers: Bytecoin owners in possession of coins in their wallets may lose
their coins when there is an attack launch on the Bytecoin system by hackers.
This mostly occur when the company security firewall has been broken down or
captured by the hackers. The company is responsible for the loss of your
Bytecoins and you can always file a case against them if their preventive
measures to refund back your coins fail.
For any Cryptocurrency to be the future, there
would always be a need for the currency to be fully integrated or utilized by
the dominant financial system and be regulated in some ways so as to provide
efficient structure and reliable security. Bytecoin financial system is a
dispersed network and the basis is such that it provides restraint for the cost
needed in the operation of the cryptocurrency. This approach allows the
Bytecoin financial structure (i.e system) to regulate the optimal state when
the operating efficiency of the system is the highest. Bytecoin goal is aimed
at developing a financial system that is more efficient than the existing ones and
such that it provides all the same functions but at a lesser cost for users.
Is Bytecoin Legal?
Yes, Bytecoin is lawful and accepted in the society
for business transactions but less than twenty percent of the population in a
country have a clear understanding on Bytecoin and other cryptocurrencies. This
inadequate knowledge and lack of exposure has created fear and doubt in the
mind of the people and thus, hinder them from participating in Bytecoin and
cryptocurrencies. Several questions has
been asked for clarification and enlightenment. Some of these questions include;
why is Bytecoin not used as the general currency in all countries since it is
lawfully accepted? Why are people still scared of cryptocurrencies despite its
dominance in the business market for transaction activities?
Although, some countries like United States,
European Union, China and others allowed Bytecoin as one of the payment methods
when making transactions. These countries are far grown in Technology compared
to most African and underdeveloped countries where cryptocurrencies appear like
a mystery to them. Bytecoin would have attracted many people if it were to be
the only cryptocurrency in the market but this is not so, because over 500 cryptocurrencies have found their ways in to the market with different technologies.
The government find
it difficult to legislate Bytecoin because of its anonymous and tricky nature.
The problem associated with cryptocurrencies are
that the crypto chains are mysterious just the same way the identity of the
founders cannot be traced. The BCN founders didn’t reveal their identity till date thus
making it more complicated for people to know who they are and where they come
from. This nature of crypto has frustrated that potential declaration of
Bytecoin and cryptocurrencies in general as legal or illegal by the Government.
Bytecoin is not single-use as most people think. Aside being
used as currency, it also creates opportunities for people through Mining as a
means of additional and steady income. Bytecoin and other cryptocurrencies seek
to explore the positive side of blockchains to shun lagging, and the possible
ways of gaining the heart of people in this new era of technological
advancement by capitalizing on the flaws, and havoc the current fiat currencies
have caused such as inflation and direct interference. Considering the
opportunities that bytecoin have created, most countries will not find it
appealing to shut down its actvities.
Fiat currencies are designated to specific territories while
Bytecoin is bound to the Internet. Hence, it is International by default. Though
Bytecoin is accepted and widely in use today, but the impending government
regulations could affect the current appcreciative value of Bytecoin and thus,
makes its future unpredictable.
Bytecoin and Taxes