Bitcoin has now been officially accepted as one of the most famous things worldwide, people have looked up for it on the internet, have put their money on exchanges to buy while others have refrained from it thinking of it as a scam, owing to its decentralized nature.
Top 5 Bitcoin Myths Busted
With a topic as controversial as Bitcoin, something that stays in the news all the time, myths and controversies are natural to follow. Here are the Top 5 bitcoin myths, which need to be debunked right away!
Bitcoin Myth 1: Bitcoin is used for illegal transactions such as money laundering
This misconception has surfaced owing to the anonymity of Bitcoin which makes it appear to be an attractive alternative for illegal transactions, however, this anonymity is really an illusion. Bitcoin is one of the most transparent currency systems to have ever existed, every Bitcoin transaction is recorded on a public ledger called the ‘Blockchain’.
However, the name anonymous in this case is misplaced and it should be “pseudonymous”. Pseudonymous means that it has several pseudo names whose origin can be traced.
Bitcoin holders are normally assigned to different Bitcoin wallet addresses whose owners can be identified. Contrary to many other cryptocurrencies, Bitcoin transactions are usually displayed on a public ledger. So the public can easily go through the transactions.
Bitcoin Myth 2: Bitcoin doesn’t have any value
This bitcoin myth is very common. People often worry that Bitcoin is just a fad. Some fear that it could just go away, taking its equivalent value in fiat currency with it. Cryptocurrencies are no different from other currencies in that they can be used to buy goods and services, meaning that they do indeed have value.
Whether you believe “intrinsic value” can only be attributed to something physical is irrelevant. Bitcoin introduces something completely different – a new concept of digital scarcity.
Bitcoin Myth 3: Bitcoin is an insecure investment
Governments and many large organizations are currently looking at ways in which they can use Blockchain– the technology that makes Bitcoin possible – to secure their data. This is because Blockchain hasn’t suffered a data breach since it was created. This makes it far more secure than your regular bank account.
Bitcoin has seen some of the worst hacks in the cryptocurrency world. It has seen most of the hacking that has happened and people end up thinking that it is not secure at all.
But since cryptocurrencies are digital assets, they are surely prone to hacking. It all depends on the security measures that the development team has put in place.
Bitcoin Myth 4: Bitcoin and Other Cryptocurrencies Are Not Eco-Friendly
People have always pointed fingers towards the eco-friendly prospects of Bitcoin when they are referring to Bitcoin mining, which uses high-powered servers. Some say that this leaves a large carbon footprint, but this couldn’t be further from the case. Many supporters of Bitcoin have been quick to point out that the value of mining Bitcoin far outweighs the real-world cost.
The value of mining for a cryptocurrency nearly always outweighs the real-world cost that is required in order to complete that mining operation. What’s more, many cryptocurrencies, including bitcoin, have set hard caps on the total number of tokens that can be mined.
Bitcoin Myth 5: Bitcoin is a scam, so are other cryptocurrencies
Another powerful bitcoin myth that has clouded over the minds of apprehensive crypto users is that Bitcoin developers are just collecting money then after they have collected enough the scheme will collapse. People actually fear that it is just a Ponzi scheme.
It’s possible for investors to be drawn into fraudulent investment opportunities in the traditional financial world as well, and this situation tends to come about when an investor has not taken the time to thoroughly consider and learn about the details of the opportunity itself.
However, Bitcoin is not a scam nor a Ponzi scheme considering its 9+ year track record. Again, there are many other cryptocurrencies that have come up as a result of Bitcoin and big companies are partnering with them in a bid to make their services better. This offers some proof that Bitcoin is genuine. Of course, price movements remain a different story, and the prices are what can disappoint investors by declining the way they are not expected to.