Here in this article, we will discuss some myths that are surrounding the cryptocurrency market and how to break it for separating the real facts from that of the misconception of the fictional rumors.
Although the dynamic cryptocurrency traders chase the news and updates from the industry, there still exist a good number of confusions and myths around blockchain and cryptocurrencies. It is very important for you to first understand the whole concept of crypto and then jump into the ocean of virtual currencies.
After reading this article, you can easily put together your thoughts and formulate your own opinion about what Cryptocurrencies are.
- Cryptocurrencies are the new generation tulip mania
Everyone knows that Bitcoin and the other cryptocurrencies are something that does not exist physically and you can’t even touch them and yet everyone is crazy about it. They do not exist in your wallet like the fiat currencies. Instead, they exist on your computer and you can buy a lot of things using them virtually. This phenomenon of cryptocurrencies is becoming global day by bay, and if one likes it or not the concept has become unignorably important.
- Trading is essential to make profits
Though people think it is mandatory to buy or hold cryptocurrencies to earn profits from them, the actual fact is that everyone can trade cryptos without even buying it. The market of these virtual currencies is extremely unpredictable and it works on speculation. There can be multiple opportunities created by the high volatile market which is a great window for making profits.
- Bitcoin and Blockchain technology are the same things
Blockchain is the underlying technology for cryptocurrencies which facilitates the process of recording the transaction within some blocks. These names can get you confused as they both stores transaction data in a chain of blocks which are linked together. Blockchain is a shared immutable ledger here no participant can tamper with a transaction after it is recorded in the chain. Cryptocurrency like Bitcoin is just a small part of its application.
- Crypto coins and tokens are the same
Crypto coins are virtual currencies which can be used as an alternative to payments, while tokens are used in a completely different way. There are many people across the world who have mistaken these crypto coins and the tokens as the same thing. Now, the virtual currency exchange market holds over 2308 cryptocurrencies each of which has a completely different market capitalization.
- Crypto Trading is not safe as the transactions are anonymous
Crypto trading and investment can be subjected to market risks just like the other investments. But it is fully secured and the only risk that can be occurred is regarding the price volatility and the regulation issues of these cryptocurrencies. There exist some cryptocurrencies that focus on privacy and anonymity, but it does not explain that all the cryptocurrencies are anonymous. They do possess a layer of transparency which differentiates them from the substantial commodities and the fiat currencies.
- Cryptocurrencies are only for the technical and finance communities
Many people are not known to the fact that every single individual in this world can do their digital currency exchange with minimum trading fees. Gradually the big companies also are accepting and utilizing these new technologies like Blockchain and cryptocurrencies. The ones with a little bit of knowledge about these new technologies will stay away from it and think that these are only for the tech people and those related to finance companies.
As more and more people are educated about these virtual currencies and trying to invest in those, would definitely argue that these are the safest and the most secure options for doing any transactions. All these virtual currencies work the same way as the traditional fiat currencies do, with the value being chosen by the same group of people who are using these currencies. The only difference between the real currencies and these virtual assets is that we can touch the fiat money physically and store them while we cannot touch the crypto assets as they are digital or virtual.
Conclusion: The virtual currencies are progressively changing the approach in which financial operations have been carried out. There are daily new additions of people around the globe who are accepting the cryptocurrencies with the intention of taking the pleasure from the benefits that these virtual currencies offer. On an endnote, for enjoying the profits from these virtual currencies in the real world, you need to take apart the myths from the truth by yourself and that too before investing in the cryptocurrency trading platforms.
