Table of ContentsStrengthsWeaknessesConclusionBitcoin is considered the world's first digital currency. The fact that cryptocurrency operates without the regulation of a single administrator or central bank makes it a decentralized currency. Since its inception in 2009, the cryptocurrency has gained popularity around the world and has been accepted as a medium of exchange by several traders. The peer to peer network allows users to transfer money directly from one person to another without the involvement of an intermediary. This method of transfer has allowed transactions to be much cheaper than other means of transferring money. However, there has been much speculation about the vulnerability of Bitcoin. The volatility of the currency also raises the question of whether bitcoin is worthy of being a real currency and whether it is safe. To better understand the security of bitcoins, it would be appropriate to compare the strengths and weaknesses of bitcoins. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get the original essay Strengths Unlike other currencies, cryptocurrencies allow peer to peer transactions. This means that users can transact without involving an intermediary since the transactions are recorded in a public ledger. Regulated currencies require an “intermediary” to facilitate the transaction. In this case, banks act as intermediaries and must charge for the transaction, which increases transaction fees. The absence of intermediaries in digital currency transactions makes it a cheaper method of transaction. Transaction costs for bitcoins are as low as $0.61 (Dumitrescu, 67). The low transaction fees have also attracted several merchants around the world who now accept the digital currency as a means of exchanging products. The security offered by bitcoins is also an important consideration. Consumers with bank accounts are offered protection for their accounts with the specific bank. This means that the security of their accounts is in the hands of intermediaries. In contrast, cryptocurrencies do not depend on intermediaries. Once a user opens an account, they receive unique private keys that are used to access their accounts and make transactions. Since the security of a digital account depends on the owner, it is advisable to create passwords that are difficult to guess in case of hacking. The high return from an investment in bitcoins is also a great advantage for users who invest in cryptocurrencies. In 2016, Bitcoin investors saw a return on investment of over 100%. The large amount of returns cannot be compared to annual bank interest rates and for this reason many clients have chosen to invest in bitcoins. WeaknessesThe volatility of bitcoins is the most concerning when it comes to investing in cryptocurrencies. Since it is a decentralized monetary system, it does not have a regulator. Unlike banks which regulate the flow of money through their defined policies, bitcoins are entirely dependent on users. This means that the price of digital currency cannot be determined or controlled. The lack of regulation has seen cryptocurrency fluctuate wildly over the past few years. For this reason, bitcoin has been called a risky investment because an investor may buy high and sell low in an attempt to get more return, but the price may fall at the time the order of.