The major challenge bedevilling bitcoin and blockchain is the possibility of a government clampdown on its activities. This is largely due to the fact that its working operations are not centralised. There doesn’t seem to be a central body that controls the activities of the trade. Rather, it is highly decentralised. It is controlled by a network of servers. Because of this, there has been quite a number of countries that have tried to regulate the activities in a number of ways:
1) Outright ban of all bitcoin activities: Countries like Venezuela have gone as far as banning all cryptocurrency activities in her country. This include exchanges, mining, etc. what this has done is to take blockchain activities underground. It is a known fact that banning an activity does not take it away, rather it only empowers the bold to take it underground and continue its activities in secret. An example is having a law that bans manslaughter, and prescribing punishment against it. It doesn’t mean that there’s been a stop to manslaughter, in fact, it has empowered the bold ones to continue in its act. And it also gathers more popularity from the inquisitive ones who want to know what and why it was banned.
2) Exchanges: Government can go ahead and decide to shut down exchange platforms like OTCBTC and others. This may affect prices in that country, but wouldn’t stop these platforms from operating. And such exchanges can go to other countries to run and may even make it available for citizens of that country. Shutting down exchange platforms may only ensure that the value of these fiat currencies drop. But it will still pick up.
3) Go through all the miners: When government goes through the miners to regulate prices and activities, it will only make transactions volume decrease, and the medium of transaction may take forever to process. But bitcoin and blockchain is highly versatile; and its activities will still pick up. Or government can become a miner itself which may lead to the same action. And it will have same occurrence.
4) Stopping the internet: it can as well try to stop the internet. But there are transactions that do not need the internet to run. They are called peer-to-peer transactions. Even if the government blocks the internet, transactions will take on a peer to peer basis. In addition, there are bitcoin multinationals that are working on getting a satellite for cryptocurrency activities. This, on its launch will run devoid of government attention.
5) Quantum computers: there is a new form of computing called quantum computing. Regulators can, through this, run algorithms that disrupts and stops or controls bitcoin activities. But counter-algorithms can be created to stop this.
6) Thought campaigns: What this means is that regulators, government can run campaigns that will ensure that citizens see its activities as bad and not to be used.
We need to understand this: What is the purpose of regulation financing? Why are the government fixed on regulating its activities? By answering these questions, there will be an agreed togetherness between the government and users. Because blockchain is so versatile and flexible, it would be quite difficult enforcing regulations that will keep its activities off forever.
