5 Cryptocurrency Myths That You Should Stop Believing

Over the years, cryptocurrency systems have gained immense popularity. But despite their widespread demand, rumors and false claims still remain.

And why is misinformation still rampant in the cryptocurrency space? Because of the law of diffusion of innovation.

Law of Diffusion of Innovation, Source: Cornell University Blog

At this point, the crypto community mainly comprises of innovators, early adopters, and the early majority.

Rising awareness has provided a much-needed boost to cryptocurrency innovation, experiments, and trials.

But folks (who would later become 'laggards') have their misconceptions and apprehensions. Let's try and bust these cryptocurrency myths. For good.

Cryptocurrencies Are a Giant Scam

It is easy to call something a scam, without really understanding its utility. Cryptocurrency detractors think that the market is a giant Ponzi scheme. Not true.

Scams or scammers are everywhere. Even in conventional financial markets.

Smart investors stay away from fraud. They always take their time to measure and size up assets before making their move. Research and study is an essential aspect of all their strategies.

A well-informed cryptocurrency investor knows which digital currency holds promise wrt returns and technology. He/she doesn't believe in 'scam myths'.

Crypto Assets Don't Have Value

One highly debated aspect of cryptocurrencies is their inherent value.

By questioning value, skeptics usually point fingers at the very existence of digital assets. They also predict their inevitable extinction.

Any asset, even government-backed currencies like the INR derive value from the faith of users.

The same goes for cryptocurrencies too. The only reason why crypto assets have accrued value over the last several years is that people trust them to hold value.

People also trust digital currencies with financial transactions and various other applications.

Also, cryptocurrencies are not created out of thin air. Different virtual currency networks use different protocols to create their respective digital assets. That, in turn, imparts crypto tokens their value.

Digital Currencies Fuel Illegal Activities

Money laundering is also what cryptocurrencies are primarily targeted for. Also for drug trafficking and other illegal activities. But why?

Virtual currencies are considered to be anonymous, favoring their application in illicit doings. That's not true.

Cryptocurrencies are largely pseudonymous. The transaction amounts and addresses are openly visible for the public.

Even privacy crypto assets like Monero are not completely untraceable. Read more about it here: https://www.wired.com/story/monero-privacy/

On the flip side, the public nature of cryptocurrencies helps pin down criminals. Click the video link to know more: https://www.youtube.com/watch?v=jgXL5__Gpac

Cryptocurrency Systems Are Not Secure

Crypto assets operate on blockchains. These are decentralized networks. Participants contribute their time and computing power to validate transactions on the network and keep it secure.

Hacking a blockchain is a far fetched idea. Infiltrators would ideally be required to take control of a major portion of the network.

This is impossible as any move to gain illegal access within a blockchain would immediately become known to all members and the attempt will be thwarted.

Sycamore Achieving Quantum Supremacy Means Doom for Cryptocurrencies

Also, the news of Google's supercomputer Sycamore achieving quantum supremacy came out last year.

Many began connecting this to cryptocurrencies, claiming that the computing beast would break Bitcoin and other blockchain-based assets in the immediate future. That is not the case.

Google's quantum computer is technologically insufficient to take down cryptography secured protocols like blockchains/cryptocurrencies.

This was pointed out appropriately by a well-known cryptographer Peter Todd in a tweet last year: https://twitter.com/peterktodd/status/1176313278114476032

Digital Currencies Are a Threat to Existing Financial Systems

Some individuals and institutions believe that cryptocurrencies are a threat to existing financial systems.

The objective of bitcoin and other such crypto assets is to democratize finance and broaden the scope of financial inclusion. Not overthrow banking and payment corporations.

The idea is to foster a collaborative culture. A culture where organizations can leverage cryptocurrency and blockchain technology to pave the way for openness and transparency.

Myths and misconceptions are rampant in the cryptocurrency ecosystem. It is essential to cut through the noise and stick to facts.

The industry is just a decade old. Cryptocurrencies have already started moving the needle in finance and other areas. Putting generous effort in understanding their potential will help us leverage them better to shape a bright future.

Buying cryptocurrencies is the first step in gauging their potential. You can do so through platforms that provide decent cryptocurrency exchange rates, for instance, WazirX.

Also, you can download app and Start Trading Now!

WazirX Android App - Buy Bitcoin & Cryptocurrency Exchange

Rea Setia is an passionate writer. She loves to share business tips and her experience about industry.