The bitcoin is the world’s first and most popular decentralized online currency, and more and more people—consumers as well as merchants—are using it every day. Yet the popularity of bitcoins would actually be even more pronounced if questions regarding security can be dispelled. People are asking the same question: are bitcoins safe to use? To answer this question properly, let’s take a look at several factors:
Bitcoin Software Security
Using bitcoins means that you use software to transfer funds, and everybody knows that software may sometimes prove unstable or insufficiently secure. But these problems are dwindling as newer versions of bitcoin software included security and stability fixes. You just need to make sure that you install updates regularly.
In fact, the bitcoin track record as far as security is concerned is quite impressive and the most common problems involve user error. The “wallet” files can be stolen or accidentally deleted, so you need to think about proper backups. These backups should be encrypted as well, especially if they are online.
And of course, your wallet should also be encrypted. You need a password that you won’t ever forget because password recovery is somewhat limited when you use bitcoins. At the same time, you also need a strong password that contains letters, numbers, and even punctuation marks so it’s not as easy to break.
Like hard cash, bitcoins can be lost as well. That doesn’t mean that it’s unsafe to use bitcoins. Let’s put it this way, we still consider it safe to use hard cash even though we lose coins and paper money all the time. You simply need to use some common sense if you want to take care of your bitcoins.
For example, you ought to consider your bitcoin wallet as a real wallet. Would you walk around with thousands of dollars in your wallet? Of course not! It’s the same thing with a bitcoin wallet. You should only keep small amounts of bitcoins available on your mobile phone or computer, with the rest of your stash placed somewhere safe. You should also inform your heirs about your bitcoins, because if you pass away they may not be able to access your money otherwise.
There is one scenario which may make it seem theoretically unsafe to use bitcoins in general, and that’s if no one accepts it as currency. There are a lot of historical precedents for this, and just recently in 2009 the Zimbabwean dollar was abandoned by their government due to hyperinflation.
But while bitcoin values do fluctuate quite a bit day by day (or even minute by minute), it’s highly unlikely that companies will start to abandon bitcoins any time soon. In fact, the current trend is an increase in the bitcoin’s popularity. Many established online sellers have begun accepting it, and many more are planning to join in their ranks. As more merchants and consumers realize just how easy and convenient it is to use bitcoins, its popularity will undoubtedly increase. The increase in usage will also cause less volatility in the value of the bitcoin. So all things considered, what’s the final verdict? Are bitcoins safe to use? The answer is a resounding yes.