Why the governments want to BAN Cryptocurrency?

Right from the time we humans introduced currencies into trade, we have seen a lot of things being used as currencies. One of the earliest currencies used to be valuable stones such gold, rubies, emerald and whatnot.

But as time went by and countries began to develop, we realized these stones were not the best currencies for a number of reasons and so we replaced them with coins made of different metals, which were cheaper and easy to find. And although it didn’t actually hold any value, we humans turned it into a valuable asset for trading.

And then we moved onto paper currency, which is still the most used form of currency. But with the recent development in technology, some of us are trying to get rid of paper, heck all sorts of physical currencies from the world and replace them with digital currency. I mean we already do buy digital currency, like gamers buying New World gold, which doesn’t have a real life value but it makes sense because it does hold value inside the game. Even if you buy games, in forms like game cd keys, every player has full control of what they earn inside the game.

Speaking of which, blockchain technology has given birth to cryptocurrency, which is already on the road to replace physical currency. However that might not be as easy as it sounds, as the Government is trying to ban cryptocurrency. But why?

It Devalues the Physical Currency

Any countries governments thrive on regulating the currencies, these include paying the government taxes when you buy something from the store, increasing the face value of currency when you use it instead of any other, makes it economically valuable than other currencies out there in the world and lets them government know if you obtain it from illegal sources.

But what if you could just use a digital currency that has nothing to do with the government, that is completely decentralized and taxes you nothing to transfer anywhere in the world. That would make more people use it instead of the physical currency of the country, which will devalue the currency and eventually make it cost more for production than its actual value in the world. Why would any government want that?

That is one of the reasons the government wants to ban cryptocurrency but there are many to come.

Government Loses Control

Governments all around the globe are still attempting to figure out how to regulate Bitcoin, more than a decade after it was first launched. The challenge of bitcoin regulation is multi-faceted.

Changing narratives about Bitcoin's utility, for example, have complicated concerns about which government agency should be in charge of overseeing the cryptocurrency, what definitions should be employed in lawmaking, and even how laws should be drafted.

Is Bitcoin a money that can be used in everyday transactions or is it mostly utilised as a store of value for investment? Is Bitcoin a safe haven asset amid a global economic downturn? Neither the so-called Bitcoin expert nor the average bitcoin investor seem to know.

Make Crimes Easy

While the crypto currency can and already is devaluing the physical currency, there are more at stake here. The other reason why the government wouldn’t want the citizens to use crypto is because it is kinda impossible to track the transaction as they take place on blockchains with peer to peer transactions.

To put it into simple words, if you want to transfer money to your friends living on the other side of the planet, you don’t need to paypal or wire transfer to send the money, which will deduct some tax for transaction. Instead, you simply put in a digital wallet address of the person who you want to transfer the funds and click SEND. That’s it!

However, that would make it so easy for the criminals to fund illegal activities all around the world and the government would not be able to track them.

What if they DON’T?

I mean sure the government wants to ban cryptocurrency but it would also not do any of the crypto users any good if they just accept the cryptocurrency. Why? Because then they would have to somehow regulate the currency the same as the physical currency, which means they’d be able to tax each transaction, keep track of all the transactions that you have made, how many crypto coins do you own and so much more.

This kills everything that cryptocurrency is currently being used for and in that case, the users would also have to just ditch the currency. While most of the countries are against the use of cryptocurrency, there are some countries that want to embrace this technology and for the same reason as everyone else, AVOID INTERNATIONAL SANCTIONS AND TAXES!

I mean it’s just too complicated when we think about it getting accepted or banned and I am sure many of the crypto lovers just want it to stay like this for years to come at least, so they can take full advantage of it.