So, you’re interested in cryptocurrency trading? Why wouldn’t you be? It seems the whole world is talking about it and you don’t want to be left behind. But if you’re like many other budding crypto investors and feeling doubtful, wary and uncertain about whether or not you should start to trade, read on to learn more about common myths in the crypto-verse — and why they shouldn’t hold you back.
1. Cryptocurrencies Are for Criminal Activities
While cryptocurrencies are involved in transactions on the dark web, laundering and other illegal transactions only constitute only about one percent of all crypto transactions.
So if you’ve heard rumors about crypto harboring illicit activity, rest assured: It’s not the Gotham City of finances. Cryptos have a much wider range of uses than the negative incidents that the media might focus on. In fact, though trading today forms the majority of total crypto transactions, in the coming years we might see an increase in the use of cryptocurrencies for various other purposes, including rewards systems, P2P and P2B payments, cross-border transfers and more.
Wham! There goes the most common crypto myth, soaring out the window!
2. Cryptocurrencies Are Illegal
Since the crypto boom in 2017, most governments have kept a close watch on cryptocurrencies to regulate them and prevent their use in illegal activities. But since crypto has only become very hot news recently, most governments don’t have the expertise to understand how crypto functions. Thus, they’ve banned cryptos or ignored them until they figure out exactly how to manage them or, in the case of Russia and China, develop their own.
The bottom line? Cryptocurrencies are more often than not neither legal nor illegal — there’s simply no protocol surrounding them. In such cases, you can still trade and transact in crypto, but the direct inclusion of financial entities to convert cryptos to fiat and vice versa might not be possible.
3. Cryptos Are Dead
During the 2018 crypto “bloodbath,” most cryptocurrencies lost as much as 75 percent to 90 percent of their value compared to their all-time highs. Some people thought that this spelled out the end of crypto, and that Bitcoin and other popular coins would become obsolete.
That’s not true. In fact, after the major dip in the market, only investors who truly believed in blockchain and felt passionately about crypto stuck around, shifting the whole market so that it was composed of more mature traders and innovators. Those making the noise were set aside swiftly.
The other thing to keep a note of is that cryptocurrencies are again on the bull run, with most of them adding huge gains at the time of April 2019. It might change in the coming times, but the movement is a sure sign of cryptocurrencies not just surviving, but thriving!
4. Bitcoin Equals Cryptocurrencies
Bitcoin was the first ever cryptocurrency, but it’s not the only cryptocurrency out there. To be precise, 2,160 live cryptocurrencies are trading on different exchanges as per CoinMarketCap.
So, the next time someone says cryptocurrencies, let your thought be 2,160 rather than bitcoin. It’s better not to put all your eggs in the bitcoin basket.
5. Cryptocurrencies Are Prone to Theft
Precious items, especially money, are assumed to be prone to theft. Crypto, however, is not — if you play it safe.
Let’s talk truth. There have been reports of theft of nearby a billion dollars in cryptocurrencies, but again, it all boils down to how safely you play the field. Unless you’re Satoshi Nakamoto, the mysterious founder of bitcoin, no hacker is going to target your cryptocurrency wallet specifically. Until then, protecting your crypto holding from being stolen is as easy as not sharing your password, adding a two-factor authentication to your crypto wallet and not trusting anyone else with your account.
What we’ve discussed here in this piece is just the tip of the iceberg. As you delve deeper into this sphere, you’ll have to cut through more and more noise to differentiate between the right information and the total B.S. Since you got a head start with this article, we believe you’re good to explore what lies ahead. And in time, you’ll learn for yourself that