Governments and financial controllers have continuously discouraged the use of cryptocurrencies. Although cryptocurrencies provide investors with a more flexible money-making scheme, the practice continues to be illegal in most economies worldwide. The government is solely responsible for the ban of cryptocurrencies because of the secrets associated with the procedure. For instance, cryptocurrencies operate as digital currencies, making it easy for governments to track down people’s spending and wealth accumulation. Equally, the governments maintain anonymity on cryptocurrencies to identify and curb illegal practices such as money laundering and other criminal offenses sponsored through unregistered means. This makes the government more accountable and in control of the financial and economic markets.
Rapid innovation and investments in digital currency are a threat to the financial stability of nations. Governments reserve the lifeblood of any economy; however, with cryptocurrencies, people save money, make purchases and maintain encrypted accounts without the governments’ knowledge. The speculative investments in digital assets may increase the people’s wealth and geopolitical power; against the government’s control. This post-modern competition may destabilize the government by creating a central bank digital currency to facilitate and control commerce. However, governments cannot admit that the existence of cryptocurrencies is a threat to the government’s economic stability or political power. In addition, cryptocurrencies operate as secret dealings where investors avoid the taxation costs by accessing any financial services through unbanked means. This further jeopardizes the government’s operation in revenue collection and policy development. As such, governments lose authority over the people and the economic functions.
Digital currencies can be used to control inflation, curb recessions, and other economic turbulence. Cryptocurrencies increase people’s financial wealth and enhance their purchasing power. Although this is a positive phenomenon, governments still reserve this secret to avoid commotion and intensive investments in cryptocurrencies. Since cryptocurrencies are highly volatile and easy to use, the coins offer an alternative means to control adverse economic indicators. This was evidenced in the 2008-2009 recession when the first bitcoin- one form of cryptocurrency was launched into the markets, enhancing economic function. Although this is a positive trend, the secret is highly valued in most societies to prevent mass investment in cryptocurrencies which may inhibit the government’s cash flow control. In addition, cryptocurrencies inject a handful of amounts into the economy to curb the extreme rates of poverty, unemployment, and the social evils associated with economic inequality.