Top Cryptocurrency Myths Debunked
Ever seen an episode of MythBusters? Well, this is the crypto version. In this episode, we will refute some popular crypto myths.
Awareness about cryptocurrency has grown since the introduction of Bitcoin in 2009 by an anonymous entity known as Satoshi Nakamoto. However, there still seems to be a generally low level of understanding about crypto and how it works. Consequently, this large-scale lack of knowledge has bred many misconceptions about crypto. Right from its early days, many people viewed crypto as a bubble that would burst sooner or later. Years later, the crypto market has a cap of over 1.2 trillion US Dollars and does not look like slowing down anytime soon.
While some of the myths surrounding cryptocurrencies are harmless, others have the propensity to cause confusion, fear, and suspicion in the minds of people. This is why we at Vent Africa, recognising the importance of sharing knowledge in our quest to bridge the gap between crypto and the real world, have decided to take a look at some of the common myths about bitcoin and cryptocurrency in general, with a view to debunking them.
MYTH #1: Crypto is Mostly Used for Illegal Activities
One of the common myths about crypto is that it is widely used for illicit dealings. However, this is a big exaggeration. According to a report by Chainalysis, the number of cryptocurrency transactions related to illicit activities in 2022 was just around 0.24% of all cryptocurrency transactions. While this shows that some entities use crypto for illegal activities, the same could be said of any other form of money over the years. Notably, governments worldwide are implementing regulations to crack down on the unlawful use of crypto.
Conclusion: Most crypto transactions are for legal activities.
MYTH #2: Crypto is a Scam
Crypto, in general, cannot be said to be a scam. Statements that crypto is a scam are simply unfounded, as most crypto tokens do not have any malicious programming or built-in code to steal money from you. That being said, it is impossible to neglect the various cryptocurrency scams which have been and are being perpetrated by nefarious actors to steal crypto assets or cash from unsuspecting victims. As such, every crypto holder must be reasonably careful not to fall prey to such scams.
READ NOW: Securing Your Crypto Assets
Conclusion: Crypto is not a scam, and although crypto scams exist, having proper knowledge can help you mitigate the risk of falling for such scams.
MYTH #3: Crypto has no Real Value
One of the arguments against cryptocurrency is that most digital assets, excluding stablecoins, do not have any real or intrinsic value because they are not backed by anything tangible. The shortcoming of this argument is the fact that most fiat currencies aren’t backed by anything tangible, either. But unlike fiat, with which inflation can arise when large quantities are created, thus diluting the existing supply, cryptocurrencies like bitcoin are hard-coded to be scarce, making them inflation-resistant. However, in the real sense, the value of any currency, fiat or digital, comes from mass acceptance and adoption.
Conclusion: Value is subjective; it isn’t determined by being backed by something tangible.
MYTH #4: Crypto Investment is Gambling
Naturally, cryptocurrencies are prone to high price volatility. This fact has contributed to the perception that investing in crypto is similar to gambling. However, this comparison is faulty. Gambling is based on chance, while cryptocurrency is based on mathematics and cryptography. Crypto investment, just like many other types of investment, involves taking calculated risks. The level of such risk may be mitigated through the use of risk management techniques or investment strategies like dollar-cost averaging.
Conclusion: Crypto investment is not gambling
MYTH #5: Crypto is a Fad
The view that crypto is just a fad has been disproved by the giant strides it has taken in the past decade. The changes it has already made to the world of finance as well as the way people now look at their money, cannot be disputed. While it is difficult to predict how things will develop in the coming decades. it is safe to say that the technology introduced by crypto and blockchains will most likely continue to be built on.
Conclusion: Crypto has been around for over a decade with no signs of slowing down anytime soon.
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As crypto continues to change how people think about money, Vent Africa remains dedicated to revolutionising how crypto is exchanged for fiat. We’ve built a reputable off-ramp platform that makes crypto-to-cash transactions more straightforward, effortless, and secure than ever.
Read more: 5 Reasons to Trade with Vent Africa.
