New Issue Published

Read Latest Issue

Back to top

Challenging 6 Misconceptions about Cryptocurrencies.

Ever since the first cryptocurrency Bitcoin became available to the public in 2009, misconceptions about this digital currency have always…

Challenging 6 Misconceptions about Cryptocurrencies

30th May 2024

Ever since the first cryptocurrency Bitcoin became available to the public in 2009, misconceptions about this digital currency have always followed its every step. This could be largely attributed to how new it was still at that time, with many people becoming dubious of its credibility and how long it would be able to sustain itself. A decade and a half later, cryptocurrencies remain strong, and people are either already using them and investing in them—or they are looking to get started.

Here are just some of the common misconceptions about cryptocurrencies that you’ll often come across, along with the actual truths behind them.

1. Cryptocurrencies Don’t Have Real Value

The lack of something tangible to represent cryptocurrencies and other digital currencies often lead people to think that they have no real value. Moreover, since crypto values are subject to rapid ups and downs, there are those who think this means the values of these coins are arbitrary to begin with and thus have no real meaning. Both couldn’t be farther from the truth as crypto coins continue to be used today for various transactions and fo investment purposes. More retailers and merchants have started accepting crypto payments as payment for their products, for example.

The fluctuations that are so evident in crypto values are also not unique to them, as any currency can be subject to such changes depending on factors such as supply, demand, and other economic circumstances.

2. Cryptocurrencies Aren’t Secure

Although digital by nature, there are actually numerous security measures in place that ensure the safety of crypto funds and investments. Encryption techniques and technology are employed by crypto ledgers, making the possibility of funds being stolen almost nonexistent. The vulnerability, however, lies with unsecured crypto wallets, a digital platform wherein access keys are stored. If these access keys are lost by the user or if the user fall for a phishing scam, the security of their wallet can be compromised.

The best way to protect your funds is to have a secured crypto wallet. For example, those using or investing in Monero can have an XMR wallet to store their private keys in a safe and secure manner, away from potential hackers. For further security, you may also consider backing up your wallets offline through physical devices or even just tangible documents where your keys are recorded.

3. Cryptocurrencies Are a Scams

The belief that all cryptocurrencies are a scam is also false. Many of the reputable and trusted ones such as Bitcoin or Ethereum have been around for years now, continuing to serves as stores of value of hundreds of millions of users and investors. Of course, scams in relation to crypto coins also do exist, though that goes for every digital platform and not just cryptocurrencies. Just be sure to do your research and stay vigilant to ensure that you won’t be deceived by cyber criminals offering supposed new crypto ventures with the intention of scamming prospective investors like you.

4. Cryptocurrencies Are Only Used for Criminal or Illegal Transactions

Again, this misconception may have been brought about by crypto’s digital nature. People tend to assume that the all-digital transactions meant that something shady might be going on under wraps. While certainly, there are those who could potentially use crypto coins for illicit activities, the same can be said of any monetary transaction. In fact, the volatility of crypto coins can even be a deterrent for criminals, thus lowering the chances that they’ll depend on them for their misdeeds.

At the end of the day, most cryptocurrency transactions go through legitimate platforms. Some governments are even imposing crypto regulations now for the added peace of mind of those involved in transactions. Prosecutions of criminal cryptocurrency-related activities use are also in place, deterring many potential offenders.

5. Cryptocurrencies Are Completely Anonymous

Many also seem to think that crypto transactions are completely anonymous and thus nothing can ever be traced. However, there is actually a digital ledger called a blockchain wherein transactions are recorded and assets are dutifully tracked. Most blockchains are even publicly available.

Of course, anonymity and privacy are two different things, and you can indeed expect a high level of privacy for your crypto coins. For example, as long as only you hold the private keys of your investments, then only you can access and use them for transactions.

6. Cryptocurrencies Are Just a Fad

As with anything that becomes the talk of the town, many people worry that cryptocurrencies may just be a fad—meaning that they will only be relevant for a short period of time and will eventually be completely forgotten, thus rendering the coins useless. However, since their inception, cryptocurrencies have remained active and are even thriving until today. Financial institutions and governments have also been taking a keen interest in crypto coins, which supports their continued integration into the mainstream financial system. While of course, no one can truly predict the future of cryptocurrencies, their current state remains stable, thus making them surely worth looking into.

As cryptocurrency use continues to rise and becomes more integrated into everyday financial transactions, misconceptions like those mentioned above are likely to persist. However, through diligent research, you can independently assess the facts and discern what truly makes crypto a worthy investment.

Categories: Articles

Discover Our Awards.

See Awards

You Might Also Like