10 Biggest Cryptocurrency Myths Debunked

How frequently do you come across information like cryptocurrency myths? There are a lot of secrets and puzzles in the digital field. In this article, we will analyze the ten most famous myths about cryptocurrency and try to debunk the biggest cryptocurrency myths.

Myths About Cryptocurrencies

Both beginners and advanced users find it complicated to distinguish cryptocurrency myths and realities. Now we’re going to debunk the ten biggest of them. Let’s get started!

Myth 1: Cryptocurrency Is Not Taxed

Here is the first crypto myth to debunk. Absolutely, neither banks nor a central authority are engaged. However, this doesn’t mean that digital money will not face taxes. The general rules of tax legislation governing the taxation of transactions with property also apply to transactions with cryptocurrency.

There is no unambiguous and straightforward procedure for calculating the tax on cryptocurrencies at the moment. However, don’t forget that taxation is still subject exclusively to profit from transactions with cryptocurrency – any activity with it in which income exceeds expenses. At the same time, the profit from mining or staking is recorded only at the time of selling the asset and receiving real money for it.

Myth 2: Cryptocurrency Doesn't Have Any Real Money Value To Them

Is this the biggest myth about cryptocurrency? We think yes, for sure. Since there is no permanent tangible asset supporting cryptocurrencies, this is arguably the biggest myth about them.

This myth about cryptocurrency is absolutely not true. So cryptocurrency is a full-fledged means of exchanging and storing value. In addition, cryptocurrency also has value due to its blockchain technology, a decentralized data storage system that ensures transparency and security of crypto transactions.

Myth 3: Cryptocurrencies are Only Used for Illegal Activities

This myth about cryptocurrency is also one of the most popular in the crypto sphere. You may use cryptocurrency for a number of purposes, like investing, trading on exchanges, paying for goods and services, and sending money. Its legitimacy has also been confirmed by the increasing number of companies that have started to accept cryptocurrency payments.

Myth 4: Cryptocurrencies Lack Regulation

Since cryptocurrency is a relatively new asset class, laws governing its usage and transfer among people are currently being developed. However, a lot of countries have already acted to control the crypto market globally.

This myth crypto doesn’t have a reliable foundation, even though the fact that cryptocurrency is partially or wholly banned in many countries of the world. Nowadays, more and more countries understand the importance of cryptocurrency in the modern developing world and therefore create concepts and improve regulatory measures so that cryptocurrency can be implemented more easily in the future.

In the Cryptomus blog you can get more information about specific countries that have already embraced digital currency by clicking here

Myth 5: Cryptocurrencies Are Easy To Hack

This myth around cryptocurrency is also prevalent among novice traders and people far from the topic, and it also is not true. It’s extremely tough to breach the security protocols and sophisticated mathematical algorithms used by cryptocurrencies and the blockchain network as a whole. The majority of crypto wallets offer excellent security using specific features like private keys and two-factor authentication.

Myth 6: There Is Only One Huge Blockchain In Place

Definitely not! Numerous blockchains exist, and each one is compatible with a different kind of cryptocurrency. For instance, the three distinct blockchain networks—Ethereum, Bitcoin, and Litecoin—have varying features, capacities, and supported coins.

Myth 7: Cryptocurrencies Are a Get-Rich-Quick Scheme

This crypto myth is also not true. Like any other type of investment or trading, cryptocurrency requires a serious approach and specific knowledge. It definitely doesn’t guarantee quick and easy money-making. In fact, investing in cryptocurrency can be very risky and requires experience or although training in advance.

Myth 8: Cryptocurrencies Are Not Accepted As a Form of Payment

With the development of many organizations and online stores, more and more of them accept crypto as a payment method. Some countries are also starting to consider using cryptocurrencies as an official currency. For example, in Switzerland it’s already possible to pay taxes in cryptocurrency. In Japan Bitcoin has been recognized as the official currency. In this way, this statement is also one of the popular cryptocurrency myths.

Even in the gaming industry the crypto payment method is beginning to be widely used, too. If you’re interested in this topic, check our article about buying video games with BTC by clicking here to make your gaming experience richer.

Myth 9: Cryptocurrencies And Their Transactions Are Untraceable & Anonymous

Every crypto transaction is kept track of on a public blockchain, a distributed database that is open to all users. This allows anybody to observe all transactions linked to a particular wallet or address.

Nevertheless, it’s not always possible to uniquely identify the owner of the wallet, since network participants use aliases and anonymous addresses. Thus, all crypto transactions are tracked on the blockchain, but it’s not always possible to identify their participants.

Myth 10: All Cryptocurrencies Are the Same

Many people understand that the field of cryptocurrency is quite multifaceted but the myth crypto that all digital currencies are the same is still widespread. Different countries have their own national currency. Similarly, in the cryptocurrency world, there are a vast number of currencies and coins that have various characteristics and features that make them unique. The transaction of some cryptocurrencies may take longer, while others take much less. Volatility, capitalization and demand also play a significant role.

We hope this article was useful and now you will explore more carefully and, most importantly, check the information about the cryptocurrency space. Expand your knowledge together with Cryptomus!