Every new trend in the world comes up with its own folk stories. Cell phones were once considered handy spies who could get control over humans. Artificial intelligence-related Quantum AI Trading was also considered to be a secret intelligence agent.
Some people blamed popular social media platforms for leaking the data and selling photos of people. And the list of examples goes on. Similarly, digital money is also accused of things that are not true. The article will highlight a few fallacies related to cryptocurrency and the extent to which it is true.
Myth # 1:
Cryptocurrency is used just for criminal activities
Because of the lack of regulations and exclusion of central authority, it is a pretty popular idea that cryptocurrency is used for illicit activities. This may be true to a minimal extent.
Thousands of people have put their money in digital currency. As per the data received, only a negligible amount of people were caught performing criminal activities.
At the same time, most people use it merely for investment purposes to get potential gains. So one of the major misconceptions about cryptocurrency is that it is just used for illegitimate events.
The most reputable digital currency, Bitcoin (which is the first known digital money), is soon going to be followed by the security exchange commission.
Myth # 2:
Digital currency is not valuable
There is no doubt that cryptocurrency is highly volatile, which means its price swings are unpredictable, but it does not mean that it holds no value. Cryptocurrency is enhancing its value day by day.
For instance, when Bitcoin commenced its digital coins, the value was almost a few thousandths cents. And today, its value has reached around USD 40,000. This shows how treasured digital money is.
Myth # 3:
Digital Cash is terrible for the world
This statement is true to some extent. Digital money is awfully terrible for the environment. This is basically because of the consensus mechanism. For instance, the proof of work mechanism of Bitcoin is highly energy-intensive, and mining in it can consume electricity equal to the power of a town.
It also slows down the transaction procedure. The bitcoin company has purchased fossil fuels to reduce energy consumption. But burning fossil fuels can increase carbon in the atmosphere, which is harmful to the environment.
The new crypto platforms have offered different consensus mechanisms to address this issue. The alternative to proof of work is the proof of stake mechanism, which selects one validator, thereby reducing energy consumption.
So, the digital market is constantly progressing to minimise the negative factors related to it.
Myth # 4:
Crypto is a fraud
This statement is not valid. In the beginning, some initial coin offerings (ICOs), allegedly took money from people and vanished. But, many reputable cryptocurrencies are offering genuine and legal services.
These include Bitcoin, Ethereum, Cardano, Solana, Litecoin, etc. Looking for a real cryptocurrency is like searching for a needle in a haystack. But, it is not impossible.
If invested in the correct currency, investors can gain potential benefits without being scammed.
Myth # 5:
Trading in digital currency is a multiplex phenomenon
This is not true at all. Various platforms have been discovered who have made trading in digital cash as easy as possible.
It is not as difficult as people have made it. You need to have a crypto wallet and some money to invest in commencing trading on digital platforms. But, you must be very cautious about scammers.
To save yourself, always choose a well-known currency so you will not land in hot waters.
Summing it up
To wrap it up, there are several misconceptions about cryptocurrency. Most of them are not valid and emphasise defaming the decentralised market. But some are true to a bit extent.
However, the experts are constantly finding new ways to bring innovative techniques in order to cut the fallacies. They are trying to legalise it by contacting the official forums.
Many platforms, such as Bitcoin, which is the most reputable digital currency, have addressed all the issues and made it trustworthy for the people, consequently gaining the spotlight from around the world.
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