5 Crypto Myths Disproved
This year, cryptocurrency has shown us nothing short of what I would call “pure savagery”.
For the most part, crypto has been the topic of discussion all over the news and social media lately for all the wrong reasons.
Some crypto critics avoid crypto because they feel it is not regulated enough or think it’s not secured enough to stand the test of time.
While others refuse to adopt it because they don’t understand it.
Such of lack of trust and knowledge is a perfect nest of misinformation. And as a result, we have a handful of myths surrounding the crypto-space, especially now that we are experiencing a bearish market.
That is why you have to be aware and careful not to fall for any one of these 5 myths disproved.
Disclaimer: As with any financial product, due diligence is key. This article only presents information accurate at the time of writing and does not serve as financial advice.
1. MYTH: Crypto Is Unregulated
FACT: Cryptocurrencies are regulated
The existent financial systems have taken a lot of years to develop into what we have now, while blockchain technology is relatively new and governments are finding ways to create legislation for the fast-growing technology.
Towards the latter part of 2021, the US Congress added over 30 cryptocurrency and blockchain bills aimed at crypto and blockchain policy.
In Australia, cryptocurrencies are legal and regarded as property. That means that they are subject to capital gains tax (i.e. Tax is imposed on the profit an individual makes from selling a crypto asset).
All these regulations are put in place to ensure safety, security, and transparency in the crypto-space.
2. MYTH: Cryptocurrencies are backed by nothing, unlike money
FACT: Cryptocurrencies are backed by the technology supporting them and their users
The funny thing about this myth is that even the Fiat currency does not really have value by itself either. Although it used to be backed by gold just like traditional currencies, the value of cryptocurrencies is determined by demand and supply, while good regulation by authorities and increased adoption will boost its continued use.
Cryptocurrencies aren’t just for show either. Bitcoin, for example, has a network that settles over $10 billion worth of transactions a year, and several businesses around the world accept payment in Bitcoin.
3. MYTH: Crypto transactions are anonymous
FACT: Crypto transactions are pseudo anonymous
One of the biggest turnoffs for mainstream investors is the anonymity of crypto users.
They fear that crypto users can conduct fraudulent transactions outside the radar of law enforcement agencies and that would mean those transactions cannot be traced.
However, that’s not true, crypto being pseudo-anonymous means that all transactions are recorded in the blockchain and even if the identity of the user is unknown, the addresses involved and the entire transaction process is recorded.
And also, much more sophisticated technology and techniques are now used to track illegal crypto activities.
4. MYTH: There is only one blockchain
FACT: There are many different blockchains
Not all cryptocurrencies are on the same blockchain.
As of now, we have more than 10,000 active crypto blockchains and the number of live blockchains is increasing day by day. The number of live blockchains is growing every day at an ever-increasing pace.
For example, Bitcoin and Litecoin run on different blockchains and as a result, one can’t transact Bitcoin across the Litecoin blockchain because their blockchains are coded differently.
That is one problem that the cosmos ecosystem is trying to solve.
5. MYTH: Cryptocurrencies are illegal forms of money
FACT: Cryptocurrencies are legal in some countries
Some countries like Russia, Algeria, Ecuador, Bolivia, and others, banned in countries, G7 nations, EU nations, and the USA have made cryptocurrency a legal tender.
So, not all countries consider cryptocurrency illegal.
If you know any myth that you might like us to disprove, kindly reply to this email.
Thanks.
