Popular Crypto Myths Debunked
Digital currencies are in high demand and are ought to be one of the profitable factors of investment. Earlier, gold and shares were the proven ways of investment, but with the introduction of cryptocurrencies, it has emerged as the most preferred investment channel for the common public all over the world.
However, the introduction of something new always comes with certain misconceptions. Similarly, there are also certain key myths on cryptocurrencies. Here we will try to debunk myths about Bitcoin.
7 Biggest Bitcoin Myths
Blockchain and Cryptocurrencies are the most happening things today and almost everybody is talking about them. However, because of numerous information resources, people are getting confused and have developed some myths. Below are some popular crypto myths debunked:
Cryptocurrency Will Never Be Equally Valued as The Real Currency
The current world is undergoing digitalization and now humans exist in the form of data. Ranging from shopping online to online payments, virtual money has gained access in our daily lives. People fear that Cryptos may never be valued same as the real money. However, in actuality, Bitcoins are gaining popularity and they are set to minimize the transaction risks.
Just like other currencies, Bitcoin can be exchanged for goods and services and holds value according to the currency of the country. Bitcoin and other digital currencies are produced through a mining process that involves high electric consumption and bears a real cost. The market prices of Bitcoin at a given time depend on its mining cost and can be higher or lower as per the growth of the Crypto network.
Cryptocurrencies Are Not Secure
Another popular myth about Bitcoin is that this currency is not secure. Blockchain technology is inherently safe and secure. Its decentralization nature and encryption process make it secure for all types of transactions.
However, Bitcoin exchanges are digital and therefore they can be vulnerable to hackers. Although blockchain technology constantly reviews the system and takes all necessary measures to make it difficult for hackers to access digital wallets. All Bitcoin investors are required to undergo proper precautions while transacting with digital money.
The fact that cryptocurrencies are still not regulated by the government, it becomes more susceptible to scams and hacks. But there are several methods to make your transactions safe and keep a strict check that you are not scammed.
Use of Cryptocurrency Triggers Money Laundering
One of the biggest Bitcoin Myths is that Cryptos provide a good channel for money laundering. This is not a fact as cash is more widely used for money laundering and remains the preferred medium for money launders. Researches say that there is a sharp decline in cryptocurrency-related crime. Although people can exchange Bitcoin anonymously, blockchain technology maintains a public ledger that is free for anyone to check all the transactions made. More transparency in using cryptocurrency makes it safer and vulnerable for money launders.
Although there are low rates of fowl activities involving cryptocurrency, government authorities all over the world are looking to develop more insights to make Bitcoin transactions more regulated.
Government May Ban the Use of Cryptos Any Time
It is nearly impossible for government bodies to ban this digital money outright. Digital currencies have easy access and anybody with the use of the internet can transact with them. The only way to ban cryptocurrency is shutting down the internet, and that is just impossible. Although most of the governments are preparing themselves to exercise better control of Bitcoins, they are not willing to enforce any law over this potential future currency.
As more people are adopting the usage of Cryptos, a lot of governments have even started showing their willingness to accept Bitcoins with a more open mind.
Bitcoins Are Only Used for Speculations
Another Bitcoin myth, that digital currency is used primarily for speculations. It is far from true and is worth noting that each day the Bitcoin network is said to transact approximately $ 10 billion worth of settlements. Most of these transactions are for investment purchases and other regular use like remittances.
Bitcoins are fiduciary currencies as they are not backed by any precious metals. They have a long-term value as long as they are commonly accepted as a mutual medium of exchange. Their value basically reflects speculation on its future value.
The Transactions with Cryptocurrency Have No Track Records
One of the key myths on Cryptocurrencies believed by the most is that their transactions leave no tracks. This is a very common misconception and it is altogether the other way round.
People believe that Cryptocurrency is a derivative of blockchain technology that holds an anonymity feature. So, it is impossible to track the transactions made with the help of blockchain technology. However, the truth is that blockchain identifies and even validates each transaction and also records them in a central ledger automatically.
So, it is better to understand that all Bitcoin transactions are public, traceable, and are permanently stored in the network. All users have to reveal their identity while transacting with Bitcoins, making it a safer medium for all.
Cryptocurrency Means Scam
Another myth about Bitcoin is that Cryptos and scams go hand in hand. As every industry is filled with negatives and positives, Cryptos also undergoes the same treatment.
Cryptocurrencies are seen with an eye for the scam as they have been non-prohibited by the government. But, investing in Bitcoins is a matter of good and bad investment. When the investors are focused and can wait for a long time, they can surely generate profits out of investing in Cryptocurrencies. Simultaneously, investors making a greedy move to generate quick profits, are likely to fall into some scam schemes.
Invest Smartly with Bitcoins
The growing demand for Cryptos has resulted in certain myths and facts and has interrupted the power of common men investing in this digital currency. Although, this is the bare fact that the future of the financial world is Cryptos, investing wisely is the key to keeping your savings safe.