The 7 Biggest Challenges Facing Bitcoin

Bitcoin has come a long way in the eight or so years it's been in existence, but there's still a long way to go before the digital currency becomes a widely used method of paying for goods and services. Here are seven of the biggest challenges facing mainstream adoption of bitcoin, and what would need to happen for consumers to start using the digital currency on a large scale.

Bitcoin has been incredibly volatile since its inception. I wrote in September that $10 worth of bitcoin in 2010 would be worth millions of dollars today. And the volatility isn't slowing down -- in fact, since I wrote that article less than two months ago, the value of a bitcoin has more than doubled.

This environment has made bitcoin extremely popular among speculators who buy bitcoin hoping the price will continue to rise, but it isn't helping to fuel bitcoin's popularity as a currency. For example, if I plan to go on vacation in two weeks and want to set aside $1,000 in spending money, if I choose to store this money in bitcoin, its buying power could climb or fall significantly by the time I leave. Most people simply don't want to deal with that level of currency risk. Before bitcoin achieves mainstream adoption as a currency, I believe the price is going to need to become much more stable.

Source: Fool.com