All the frenzy and buzz about Bitcoin is not new in the market today. However, what is new is the all-time highs and the plight of Bitcoin since its surfacing in 2009. However, when the world is embracing the all-new concept and the hikes of the cryptocurrency market, there are still multiple myths and misconceptions barring people from associating with Bitcoin’s health. Even though Bitcoin is the World’s first cryptocurrency, the myths clouding around it make it daunting for many. If you are also one amongst those who are chained with concepts like Bitcoin’s value is “based on nothing”, or Bitcoin’s are all about risking your assets, it’s time to break through it. Here we have untangled and unveiled some of the most common Bitcoin myths for you.
Bitcoin or bubble
Bitcoin is quite often drawn in comparison to a 17th-century Dutch bubble named “tulip mania”. Bubbles are kind of finance cycles that surge to unsustainable rises in their market value with a sudden steep irreversible drop. A similar bubble was speculated to have surged 26-fold in its market value in many tulip varieties in 1637 with a sudden fall after six months which never reverted. Bitcoins are also speculated to be similar investment patterns. However, in the case of Bitcoin it’s different:
- Bitcoin has been through multiple value cycles in the last 12 years. However, as expected with bubbles, they boom and bust.But Bitcoin has recovered from every economic fall with new heights of value growth.
Bitcoin User Anonymity
It is indeed not like Bitcoin users cannot be traced, and they are covered in the veil of anonymity. It is a myth. Every crypto transaction leaves behind a record in the blockchains which is inevitable and can be tracked by law if required. However, it is indeed a fact that cryptocurrency transactions are not controlled or recorded by any centralized authority, instead of blocks formed across the globe maintain records. Moreover, trusted exchange platforms ensures the safety of investors with essential user records.
Bitcoin will be Future Credit Cards
Another myth about Bitcoin, which hardly has any scope for now to be a promising alternative to credit cards. Credit cards have a fast processing and enormous network. Bitcoins cannot combat that processing speed.Besides, Bitcoin transactions involve a huge amount of transaction fee, which makes it a cumbersome as well as an expensive method to replace credit cards. Therefore, currently, Bitcoin lacks the technological infrastructure to replace the credit card system across the globe.
Bitcoin is Source of Illegal Activities
Bitcoin is associated with illegal activities is not entirely true. However, every economical structure has illegal activities, and Bitcoin might not be excludedas well. To an extent,Bitcoin users indeed maintain a certain level of anonymity which is indeed a part of the decentralized system it follows, even though users and transactions can be tracked from blockchains record. This anonymity is sometimes associated with illegal activities.
However, whether it’s Bitcoin or conventional fiat currency, illegal trails of activities can crop everywhere and do exist. But the matter is in fiat currency transactions, a centralized authority controls and maintains legal activities and keeps an eye on them. Enforcement of law and a set of rules in every system helps to protect it from illegal actions and Bitcoins an improved infrastructure with time as well.
Bitcoin Consume Bulk Energy
Well, if you get into comparison, you will see the amount of energy consumed by traditional economical institutes and systems consumes far more energy than Bitcoins do. Simply take a glance at a banking system, the electricity power, staff management, software, and hardware maintenance, back-office services, supplies, security, transportation; it is indeed a huge system that has a decent share in the entire global energy consumption. Whereas Bitcoin in its comparison is a newborn system, being operated through nodes, with no share in the day to extensive financial transactions and business needs of people.
With every system which tries to make a place in the world, myths make its journey clumsy. However, as a conscious user, it is your responsibility to cross-check and verify myths and understand the truth. For example, popular crypto exchanges try to inform people with maximum elaborate and transparent information, to help all, beginners to pro.