5 Myths About Bitcoin Debunked
Bitcoin is a new and foreign concept for most people. As its community grows, misconceptions about bitcoin trading spread like wildfire as well.
Also, it does not help that the world of cryptocurrency trading can be intimidating for outsiders looking in. To give everyone an in-depth understanding of Bitcoin, we’ll debunk 5 of the most common Bitcoin myths.
“Bitcoin transactions are completely anonymous”
Not, really. Bitcoin transactions are recorded in a public ledger called Blockchain. It contains information such as amount transferred, date, and time of transfers. Through this, government bodies can trace a certain transaction to a user. Thus, it is not completely anonymous.
“Bitcoin is a scam”
One of the biggest misconceptions about Bitcoin is its alleged connection to illegal activities. This is backed by several news reports about scams that revolve around cryptocurrencies. But it is worth noting that these kinds of unlawful undertakings exist in any industry.
Bitcoin was not invented for illegal use, in the same way that the internet was not invented for piracy, malware and fraud.
“Bitcoin is harmful to the environment”
Mining is one of the ways to acquire Bitcoin. The role of miners is to secure the network and to process every Bitcoin transaction. Mining requires a huge amount of computer power. Because of this, eco-warriors have pointed out the negative carbon footprints of Bitcoin.
But this is a matter of exaggeration. In fact, modern-day banking consumes more energy than the power required to mine bitcoin.
“Bitcoin is not recognized by governments”
Major countries such as Japan, Singapore, and Hongkong are considered Bitcoin-friendly destinations. These countries have proper Bitcoin and crypto regulations in place. This proves that governments do recognize Bitcoin contrary to popular belief.
“You can store crypto coins in wallets”
Since Bitcoin is a digital currency, it is stored in a digital wallet. This wallet contains private keys that can access Bitcoin addresses. Only the user can work these private keys. There are 4 types of crypto wallets: desktop, web, hardware and mobile. It is of utmost importance to keep these hardware wallets safe and secure.