Crypto Myths and Misconceptions
“Do you think cryptocurrencies are not safe? Or is there any other co-called fact you trust which affects all your judgements? “
Well, the thing is, you don’t know what myths and misconceptions you are believing. And they are costing you profits and hundreds of opportunities.
What if you are investing in the crypto market by believing the common myths? Whether you are a beginner or an experienced investor, chances are that these myths wouldn’t feel they should be doubted.
This becomes the point where you feel concerned about what you have been doing until now. Don’t worry; you can avoid all those myths and misconceptions in the future if you read this article.
In this article, we will debunk 5 cryptocurrency common myths and misconceptions you might be trusting—until now.
How Cryptocurrency Myths and Misconceptions are created?
Let’s be honest—everything going on in the crypto market is what we have heard from everyone. The trends, new technologies and unprecedented capabilities cryptocurrencies have been something we trust without thinking critically.
And that’s how the master manipulators in the market abuse everyone’s trust. Myths and misconceptions are created and spread all around. Investors listen to those myths so often that their subconscious minds just accept them.
And then, it affects all the decisions and investments they make in the future. Perhaps you might also have those myths and misconceptions in your mind.
Let’s know about those myths and take them out before they sink in deeper.
Myth Number 5. It’s too Late to Invest in Crypto
New investors are kept out of the crypto market due to a notorious myth that it’s too late to invest in cryptocurrencies. Instead of teaching the new investors that the crypto market is highly volatile, a limit is put, and new investors are discouraged.
Let’s know how it works.
Imagine cryptocurrencies have reached their highest prices and new investors want to invest. But a feeling of fear exists that if the investment is made now, the price can come down. Therefore, instead of investing, investors wait so the price can come down.
But that doesn’t happen. The prices go higher further, and investors think it’s the highest possible price. They wait again, so the price can come down. But no, the crypto market is volatile. The price can go higher even further.
Therefore, investors should know that the market is volatile and every time is better to join the market. Just remember not to invest everything at once, if you apply a Dollar Cost Averaging (DCA) strategy properly, in the long term, the crypto market should pay you back even if you face losses when you join.
Myth Number 4. Cryptocurrencies are Bad for the Environment
Let’s be honest—every technology we use has its roots in tempering the environment. But the case is different with cryptocurrencies.
First, you need to know how cryptocurrencies are linked to tempering the environment. Some cryptocurrencies like Bitcoin are created by mining, using high-powered computers to verify transactions. The power they use could come from fossil fuels, green energy, and reusable energy sources.
Earlier, crypto mining used massive amounts of electricity, and the energy source was fossil fuels. But today, that’s not mostly the case. The power consumption has been reduced to a minimum with cryptocurrencies with proof-of-stake technology while the energy source is being shifted to renewable.
In addition, Cryptocurrencies like the Energy Web Token (EWT) are developing programs to bring greater transparency to sustainable energy usage, including renewable energy usage for Bitcoin mining.
Therefore, cryptocurrencies are no longer bad for the environment and don’t harm the environment more than paper currency printed in mints.
Myth Number 3. Cryptocurrencies Don’t Have Any Real-world Value
No doubt, you cannot hold the cryptocurrencies in your hands. But it has nothing to do with its real-world use. Even the truth is the paper money you hold is worthless if your state bank declares it doesn’t hold value. We believe in paper money because we can see it, but it doesn’t mean it holds actual value.
And the same can be the case with cryptocurrencies. Even if we cannot hold them in our hands, they can be used like the paper money. They can offer more benefits than paper money, like making cross border payments faster and more secure.
Since authorities are regulating cryptocurrencies, abuse by criminals can be checked. And as cryptocurrency adoption rises in the financial system, they will hold even more real-world value. The reason for that is—cryptocurrencies hold value because they themselves are difficult to mint. The power used to mint them actually makes them valuable—like gold minting.
Myth Number 2. Crypto Transactions are Anonymous
One of the biggest crypto myths is: since you don’t use your real name and offer personal details, all the crypto transactions are anonymous. Being anonymous means staying hidden during the whole process of the transaction. But the truth is that your transactions and you are not anonymous on the blockchain.
You can be tracked if any authority or hacker wants to know you. It’s true that you don’t use your real name, but the record of every single transaction exists on the blockchain. Your crypto wallet has an address which is also stored. And if someone knows your crypto wallet address, you can be easily tracked.
However, not everyone can get to know who you are. Only the authorities and hackers can know that if they want to. No matter the case, you cannot say you are anonymous in crypto transactions. That’s a myth and misconception everyone should know about.
Myth Number 1. Cryptocurrencies Are Not Secure
Often, it’s considered that since you don’t hold cryptocurrencies physically, they are just a step away from hackers. But that’s a myth and misconception the skeptics consider the fact.
At a point, the crypto market cap reached $3 trillion, which could never be possible if hackers could steal cryptocurrencies so easily. The whole focus of all cryptocurrencies is to be as secure as possible. And they have become secure.
Each transaction is verified by solving complex cryptographic algorithms and added to the blockchain. Now, if someone can hack that block on the blockchain, they can access the cryptocurrencies in that transaction. But this is practically impossible. To hack that block, a hacker has to hack every computer on the planet that is a part of the complex blockchain network. Every computer has the original block stored, which cannot be altered if that block is altered on another computer.
Cryptocurrencies are securest, but that doesn’t mean they cannot be stolen. However, no hacker can steal your cryptocurrencies directly. They have to scam you by phishing pages or asking for your private key. But if you are conscious, there is no way your cryptocurrencies can be stolen. And that debunks the myth and misconception that cryptocurrencies aren’t secure.
Which of these myths and misconceptions did you believe earlier?
Comment in the comment section right below:
Did you believe earlier that the crypto transactions are anonymous?
Also, let us know if you know a crypto myth we missed in this article!
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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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