Biggest crypto myths you should know
Crypto is a digital currency designed to function as a means of exchange online through blockchain technology. Blockchain uses cryptography to record and secure crypto transactions. It is basically a decentralised ledger that is maintained and updated by a network of computers.
Since no central authority is responsible for issuing crypto, transactions using coins are safer and faster. Despite the success of crypto, it can still be overwhelming to learn about crypto, especially if you are a new crypto asset holder. To help you get started, here’s a guide on crypto and the crypto myths you should know:
How does crypto work?
Coins operate independently of any single bank or governing body. They are not backed by any government and instead run on a blockchain. There is no physical form for a crypto such as a bag of bills or a tray of coins. Instead, they exist solely online.
You can think of crypto as digital coins whose worth is determined by the popularity and supply and demand in the market. Digital assets can be used in various ways such as when playing online. Since the online gaming world is a big hit, crypto can now also be used to wager on Bitcasino live casino and play Bitcasino slots.
How exactly is crypto formed? Mining is the process by which new crypto is created. Mining involves solving difficult mathematical problems by networks of computers. The miners are also tasked to verify each transaction before they are posted on blocks.
Popular crypto myths
When crypto was first introduced to the public, it received some backlash from non-crypto users due to its entirely new and modern concept. Due to speculations about crypto, myths were formed around it making some people hesitant to invest in crypto.
The popular crypto myths are false and are only based on some people’s misconceptions about crypto. To avoid believing in the misconceptions that revolve around it, here are some of the popular crypto myths:
Crypto is only used for illicit activities
The widespread belief that digital currencies are only used in illegal transactions is one of the oldest and most popular myths about crypto. While it is true that certain people have used digital currencies for bad purposes, it can’t be applied to all coins.
If you want to invest in crypto, you shouldn’t be scared. In fact, some government authorities and the crypto global community are taking action against criminals and organised crime groups who use crypto for illicit purposes.
Crypto agency and team structures have also been improved to combat the use of digital coins in money laundering and financing terrorism in many nations. For instance, In the United States, the National Cryptocurrency Enforcement Team (NCET) is in charge of looking into and prosecuting illegal crypto activities to put a stop to illicit activities surrounding crypto.
Crypto is a scam
In recent years, the widespread use of coins as a form of payment has benefited various industries. With this, the general public began to embrace crypto for everyday transactions and governments worldwide are scrambling to figure out how best to control them.
Even with how secure the blockchain is, con artists developed schemes to steal coins and assets from users. For instance, unregulated funding for new crypto ventures has been exposed as fraud. Other types of crypto scams include convincing victims to accept unconfirmed transactions or receiving phone calls from people posing as government authorities demanding payment in crypto.
Due to these, some people believe that crypto is a scam even though it’s really the bad people who are using crypto to scam others. To avoid being scammed, it’s crucial to know what to look out for and being cautious will help lower your risk of falling for a scam.
It has no value
The value of an asset can depend on a person, group, or economy. Some people may give something of significance while another may consider it irrelevant. For instance, when Bitcoin was first introduced in 2009, its value was measured in cents.
As the demand increased, the price of a single Bitcoin rose to $20,000 in 2022. Its rising price shows that public opinion plays a major role in determining an asset’s worth. There are also non-fungible tokens and decentralised finance apps built on Ethereum (ETH) blockchain that are believed to have no value at all. They have an existing value but only exist online.
Crypto is bad for the environment
Concerns regarding the effects of digital currency are warranted since some coins use an energy and time-intensive process to verify and validate transactions. Since Bitcoin ( BTC) became more popular and lucrative, big mining operations arose to take advantage of the success of BTC and control the crypto-mining market.
The energy usage of the network is comparable to that of some small countries because each mining farm needs a lot of power to run the mining rigs. However, with advanced technology, the operations are mostly powered by sustainable energy, thus the environmental impact is low.
Digital coins are not secure
Another popular myth about crypto is that it is not secure. Unknown to many is that blockchain is the central technology that crypto is based on. Blockchain technology is an extremely secure distributed database protected by cryptography.
Although hacking and stealing crypto is still possible despite the security of blockchain technology, there are many ways to ensure the safety of your crypto. For instance, you can use a highly secured digital wallet to store your assets.
Crypto is a fad
When desktop computers, the internet, and email were first introduced, only a few people embraced them. As the world evolved and people became more tech-savvy, these technologies are now cornerstones of modern personal and work life.
Just like the first time the internet and desktop computers were introduced to the public, it can also be challenging to anticipate where crypto will go in the next decade or so. Nevertheless, as crypto continues to grow and more companies adopt the use of digital currency, the crypto industry will continue to be developed and reach new heights.
Today, various decentralised finance apps are taking shape, gaining the interest of financial institutions and customers. Governments are studying ways to deploy legally-recognized coins tied to an asset that is more stable in price, while some firms are investing more in Bitcoin and altcoins.
Benefits of using crypto
As crypto grows more in success, more investors are taking an interest in using crypto as one of their number one modes of payment. Aside from being secure, crypto poses more benefits for its users. Some of the main benefits you can take advantage of when you use crypto are:
- Fast transactions → Since crypto transactions do not rely on a third-party authority, transactions using crypto are known to be fast and hassle-free.
- Low cost → Thanks to blockchain technology, BTC and ETH transactions are not only fast but also are known to cost only a few cents depending on the exchange used.
- Accessible → Crypto is a popular digital asset that’s accessible to everyone. To use crypto, all you need is a computer or smartphone device and an internet connection. It’s also easy to create a crypto wallet compared to opening an account in a land-based bank.
- Transparent → All crypto transactions take place in a publicly distributed blockchain ledger, making it transparent and available to anyone. Even though it is made available to everyone, it is nearly impossible to make any changes because of its complicated system and needs to be approved by a pool of networks.
Most asked questions about crypto
Since crypto can be a complex topic, especially for new users, it’s only natural to have many questions about the online asset. To help you learn more about crypto, here are some frequently asked questions about it:
How are crypto transactions recorded?
Crypto transactions are recorded on a public digital ledger called a blockchain. It is a decentralised technology dispersed over several computers that record every transaction.
Are blockchain and crypto the same?
No. Digital currencies rely on a technology called a blockchain. It is a digital distributed ledger that records all crypto transactions.
What are the top digital coins?
Bitcoin is the most well-known crypto in the world and is followed by other best coins to invest in such as Ethereum (ETH), Ripple (XRP), and Tether (USDT).
What is a crypto wallet?
A crypto wallet is a private and safe alternative to store your coins. There are two types of wallets: Hot wallets can be set up and used on any device with an internet connection. The other type is a cold wallet that is not connected to the internet. Since they are not online, cold wallets are a top choice for most investors.
If you are a huge fan of playing on sites such as Bitcoin live casino and playing Bitcoin slots, using crypto is a good idea. Crypto gaming does not only let you experience faster transactions but also safe ones with zero interference.