Top Five Myths About Crypto

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What are the top five myths about crypto? There are plenty of myths, rumors, scandals, and dreams about cryptocurrencies. Some are so bad that people who don’t know much about them scream out caustic excuses for avoiding the digital coins.

Here are the top five myths we’ve all heard and hear constantly. Let’s get to the ready rebuttals of the initiated.

Road Sign, Attention, Note, Scam

Myth One = It’s A Ponzi Scam!

Cryptocurrency is not a Ponzi scam (pyramid scheme) or an MLM (multi-level-marketing). This would require an obligation on your part to pay whoever recruited you. Also, whenever you recruited someone, they’d have to pay you.

For the most part, you are never recruited to become a crypto investor. You make that decision with guidance, but if someone demands money to help you, that person is running a separate business.

Go to any exchange platform you like – making sure it’s credible – and buy the cryptocurrency of your choice for nothing more than the cost of the currency and a small fee. The money kept by the platform is not trickled up to an all-high pinnacle of wealth.

Developers of cryptocurrencies may or may not become wealthy as a result of the coin’s creation. People who mine the coins may sell them for the value of the coin and charge a tiny miner’s fee. They don’t give any of this to the developer.

The developers mine their own and can sell or trade it as they wish. Furthermore, the developers never decide the value of the coin. Neither do the miners. A coin’s value is determined by the market.

Judge, Power, Court, Trial, Anger

Myth Two = The Government Is Going To Outlaw It

Some governments have outlawed it for their own reasons. Other governments are trying to make their own cryptocurrencies. Most governments, like those in Europe and the USA, no better than to try and outlaw something so accepted worldwide.

Instead of outlawing cryptocurrency, these governments are using their own methods of control over the largely decentralized assets. Count on confusing tax laws to do most of the work.

Governments don’t like any currency they can’t tax, so the once somewhat invisible transactions of digital currencies are now carefully scrutinized. That weed you were planning on buying from the dark web is now going to have the government wanting to know where that crypto went.

Bomb, Cartoon, Cherry, Enemy, Evil

Myth Three = It’s Just Used For Illegal Activities

Like any currency and valued asset, crypto can be used for both good and evil. The myth that crypto is only good for illegal activities comes from the fact that digital currencies, such as Bitcoin, were easier to spend online.

The dark web, which is also used for good and evil, tends to keep many secrets, which makes the idea of untraceable payment methods quite attractive. Did you really think this started with Bitcoin?

Did terrorists suddenly become successful with online currency? No. People looking to spend and sell for nefarious purposes have always been able to use fiat currency, as well as other luxurious items such as gems and metals.

Digital currency is less useful for law-breaking than fiat money and rubies. Why? Because criminals are just like law-abiding citizens in that they want what they feel holds value. Gold and dollars that you can handle will always be worth more than something as volatile as crypto.

Hacker, Cybercrime, Security, Network

Myth Four = It’s Too Easy For Hackers To Steal Or Destroy

Hackers have destroyed many things: bank accounts, reputations, identities, businesses, marriages, records, etc. Why not crypto?

Cryptocurrency, like any other asset, is as secure as you decide to keep it. You can keep it in a paper wallet and show it to friends around a campfire. You can keep it in a hardware wallet and flail it around while riding a roller coaster. Or you can have millions in an online wallet of dubious security.

As far as the crypto world in general, hackers could unravel it with the same ease that it would require to disempower a major government. This is because crypto is worldwide and stored in millions of computers and databases, including some that aren’t even online.

The average black hat hacker has more realistic and exciting options than trying to take down thousands of online currencies. Oh, just worried about Bitcoin? It’s all over the world, too.

The hackers who possess the skill and time to take down Bitcoin don’t exist. One would need to wait for the golden moment when all users and owners and miners had all their assets online. It can’t happen.

Sure, there are hackers who could stymie a major exchange platform, such as Coinbase, but that would be like taking down a bank. It would be a serious inconvenience for many people, but not an earth-shattering catastrophe.

Cyber Glasses, Virtual, Virtual World

Myth Five = It Isn’t Real And Has No Real Value

The Reality

The idea that cryptocurrencies aren’t real stems from the fact that they are digital. You can’t hold a Bitcoin in your hand. Those pretty coins you see in memes are just representatives of the value-holding digital coins.

Digital things are made of bits and bytes. Remember learning this? Lines upon lines of ones and zeroes make all the online data on Earth. Cryptocurrencies are as real as all those digits.

Video games are digital and you can’t feel or hold them unless you have them on a disc. But, if you lose the disc the game still exists because it is readily retrievable from countless other online sources.

You know the game is real because you can play it. You can even play it with other people around the world.  These games are made with complex programming codes.

People buy these games with fiat money because they’re fun to play. Once you have paid for the game you can resell it, exchange it, gift it, or just keep it forever in hopes that it will always be fun.

You know crypto is real because you can spend it. You can even buy things from other stores around the world. These coins are made with complex algorithms.

People buy cryptocurrencies with fiat money because they are investors and investing is fun. Once the crypto is theirs, they can sell it for fiat, exchange it for other cryptocurrencies, buy things like video games or other physical items, or just keep it forever.

The ValueConsciousness, Cosmos, God, Universe

Back to our example of video games – World of Warcraft is nearly priceless to some people. They’ll invest thousands of dollars into it because it is fun to play. It gives them pleasure, and people will pay a premium for pleasure.

World of Warcraft is worth nothing to me. I wouldn’t pay one cent for it. It isn’t fun for me and it offers no pleasure. Most gamers don’t care whether or not I like the game, because my opinion has no bearing. Theirs does.

Ten Bitcoins may have zero value to you. You can’t hold it, touch it, see it, or carry it into any store on Earth and have it valued by the seller. You won’t buy any BTC because, even though you know others would buy it from you, you don’t want the trouble of fooling with it.

Ten BTC, as of this writing, are worth more than $80,000 to me. As an investor, I can hang onto them in hopes the value will go up or I can cash them out and buy a few cars. There are more and more online stores that accept BTC. I enjoy it, so I am one of the many people who place a fiat value on it.

Bottom line = nothing has value until we, as living and thinking beings, give it value. It will be as valuable as the market decides it is. Many people want BTC. Bitcoins are rare in comparison to the people who want them; this drives the value up. Up it remains until the market wants nothing more to do with it.

It works the same way for precious metals and gems. Information and training come with prices. The more you want something the more value it has. If many people want it the value goes up.

Compare cryptocurrencies to water and gold. We all need water to survive, but water is plenteous; it is, therefore, inexpensive despite our heavy dependence on it. Gold is just a luxury. We don’t need it. Other metals can do what it does.

But gold is shiny and pretty, and many people want it. However, it is not common and easy to find. I can dig a hole in my backyard and eventually find water. If I dig a hole miles deep the chances are slim to none that I’ll find gold. If someone wants gold, they’ll have to pay a lot for it.

The official value of a cryptocurrency comes from its limited production, the amount of energy it takes to mine it, and the desire people have for it.

Few cryptocurrencies are meant to be produced indefinitely. Whether it’s by Proof of Work mining, Proof of Stake mining, or the initial limited release of a coin, it takes work to make it. Developers and miners and holders all want the coin to be worth something.

The coin is distributed in its ICO and promoted with excitement by users. Eventually, more people want it, so its value goes up. If no one shows interest, its value goes down.

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What are your arguments? How do you answer these accusations? Let us know your thoughts in the comments below!

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32 Thoughts to “Top Five Myths About Crypto”

  1. Jannette

    So glad found your article about Crypto currency has been trying to understand this concept every time I see it mentioned. I must admit am one who taught of it has a scam and run away from crypto currencies. I live in the United States where they outlawed Bitcoins and does not surprise me that they try outlaw cryptocurrencies when accepted worldwide.  Will be bookmarking your site to come back read again and also share with my friends and family.

    1. Cattington

      Hello Jannette! I’m glad you found the article useful. Bitcoins aren’t outlawed in the USA; the government just enjoys regulating and taxing them. Best wishes!

  2. Juan Saladin

    Even my 10 years old son knows it: Crypto-Currencies are the future (thus he prefers to get paid for anything he could do directly on her mom’s wallet to be a millionaire by his 18). Ponzi scams could be configured over any type of digital product (as a mask); it’s important to wait until getting the basic understanding of what Crypto-Currencies are before proceeding to complete any investment (even more when you’re requested to pay cash hand to hand to get an amount figure on an online back-office that’s not regulated by the correspondent government entities of your country).

    What gives crypto-Currencies its value is the demand for it. As it happens with any action; the willingness of the public market to get it affects its value. Reading articles of this type will give a lot of light to what Crypto-Currencies are and what they’re not.

    Thanks for a great post!

    1. Cattington

      You and your son sound crypto-savvy! Keep up the good work and thank you so much for the kind words! Happy investing!

  3. Shanta Rahman

    Many thanks to you for sharing such a beautiful article with us and I came to know about cryptocurrency through your article and I knew a little more about this currency after reading your article. Prohibited products are traded online through this currency and no government in any country gives it any validity as the government does not receive any tax from this currency and I have used this currency myself. But I have never bought anything forbidden with the currency from online and I have used this currency for good purposes and I can use it if I want and I hope that after reading your article many people will want to use this currency for good work.

    1. Cattington

      Thank you for reading and commenting, Shanta! I wish you the best as you spend your crypto!

  4. Sharon

    I never understood what Crypto was until now. It is hard to understand that something like money
    is digital. Your analogy that it is like a game helped me to understand just
    what Crypto is.

    I must be old fashioned but I honestly need to see something and be able to hold it for
    it to be real. Do you think BTC will be around for a long time?

    1. Cattington

      Thank you for your comment, Sharon. I do believe that Bitcoin will be here for at least the next three decades, if not longer.

  5. arzu hosan

    After reading your article I learned about the dark world of the Internet and cryptocurrency. I have used this currency myself but I have never used this currency for bad purposes. I learned about this currency from my younger brother and my younger brother has deposited a huge amount for the future and he thinks that  when he sell those then will make a lot of money in the future. And after reading your article, I learned that with this currency, banned products are sold online and hackers use them in particular. At present, the government of a country does not legalize this currency because they do not get any text from here and it is a very harmful currency for the country.

    1. Cattington

      Thank you very much for stopping by and commenting, Arzu!

  6. Rodarrick

    You are right on spot with this post. It is a truth that crypto currency is the world future of currency and it can only grow stronger. However, circulating rumours would only make things more worse. This is really great to see and I fancy it a lot. The myths are mere myths without substance. Thanks for sharing

    1. Cattington

      Thank you for your insight, Rodarrick! Stop by anytime. 🙂

  7. MrBiizy

    Hello Cattington. Nice to see you share this post on the top five myths about cryptocurrency. I am not surprised about these because these myths are rampant in my country. People don’t have much believe on the potency of cryptocurrency. In some few years, these currencies have dominated across the world; this is a sign that crypto is a good thing and would only get better and better. It is not a Ponzi scheme, can be used for both good and evil just like every other currency… I love crypto.

    1. Cattington

      You sound very wise, MrBiizy! Keep up the good work!

  8. Robert

    Thank you for this post on the top five myths cryptocurrency. I have seen a lot of good things about it and I have also seen some bad things. With all new forms of making money and even in the type of currency itself, there will always be people looking to scam the legit process and make or even steal money from others.

    Because of this, people having their wallets hacked into, and shady dealings in a somewhat murky market, I think is the reason that Google and many social media networks banned cryptocurrency advertisements back in 2018. Now that they have been reinstated I just saw last month that YouTube removed a lot of crypto videos.

    There tends to be so much confusion surrounding cryptocurrecies and I feel that your post here does a good job at pointing out some of the big myths in this industry. I feel that Bitcoin has withstood this roller coaster publicity pretty well and though there will always be problems, crypto is here to stay. 

    1. Cattington

      Thank you for your very thoughtful comment, Robert, and for your kind words. 🙂

  9. Jon

    I think all of these used to be legitimate concerns but as the popularity of cryptocurrency became more and more I think that it has become quite apparent that none of these are true because cryptocurrency is a stored and internet real currency that can not be disputed anymore. It has too many good qualities to not be the next type of currency.

    1. Cattington

      Thank you, Jon. You are correct. 🙂

  10. Mondez and Kayla

    Well this article just completely blew my mind lol.  Great information. Every single one of these myths, I’m pretty sure I have heard before from someone at some point. Especially number five. I really think there is almost a disbelief out there.

    I think it’s interesting that the more people want it, the more the value goes up. Are there shifts in value based on this? If so how long does it usually last?

    1. Cattington

      Thank you for reading and commenting, Mondez and Kayla. Desire is a complicated issue when it comes to value, especially since about half the people buy in a bear market while the other half only when it’s a raging bull.

  11. Audrey

    Hi

    I think most people are afraid of the unknown and it’s hard to embrace new things that will have an impact on our economy world wide. I know because I have my own wallet and know for a fact it’s impossible to cheat or be cheated as long as you keep hour wallet off line.

    You bring up some great points but I’m with you, were at the point that nothing will stop the inevitable that Crypto Currency and Bit Coins are moving full speed ahead.

    Best Regards

    Audrey

    1. Cattington

      Thank you, Audrey! Your words are spot on!

  12. Brian

    Thank you for sharing the top five myths about cryptocurrency and talking about why all those are myths and nothing more. I never once thought crypto was a ponzi scheme like so many people have or some articles have claimed. I will admit though I really thought for awhile that myth number 4 was more factual as there seems to be a number of articles talking about how crypto has been stolen from multiple places and people, but you are right, they can’t destroy it. 

    1. Cattington

      Thank you for reading and commenting, Brian. 🙂

  13. Tashibaarzu

    Thank you very much for this kind of post. In your post you have shown us top five myths about cryptocurrency. The article is really helpful.  I have learned all the things written in this article. I have learned a lot of new things from their. Before reading the passage I didn’t know enough about this kind of currency.

    The post help me to find out new things. Your five myths is really helpful. Thank you again for this kind of post. Its also helpful for other readers too.

    1. Cattington

      Thank you very much, Tashibaarzu!

  14. jahangir alam

    Thank you for showing you five important myths about the dark world of the Internet and Cryptocurrency. cryptocurrency has been banned in many countries.If the government of a country cannot accept the tax evasion of that country.These coins are more often used for bad purposes.I myself do not use bad things.I wish you more articles like the full article about the dark world of the Internet in the days ahead

    1. Cattington

      Thank you for stopping by and commenting, Jahangir.

  15. MD Mamun Hossain

    Thanks for sharing secrete information about cryptocurrency.
    I Know that cryptocurrency also can use for a bad purpose. Many years ago I also used cryptocurrency but only for good work not for a bad purpose. But I don’t use it now. In our country, the Government banned this Cryptocurrency. because the government said that this cryptocurrency could be harmful to our country in the future. but I don’t think so. because If we use it for good purposes then it can change the future of currency.
    Anyway, thanks for sharing five myths about Cryptocurrency. I didn’t know about these myths before after reading your article I found out about it. It’s really helpful for us. Thank you so much

    1. Cattington

      Thank you for your kind words, MD. Hopefully, your country will choose to allow crypto.

  16. Parveen

    You are right on spot with this post. It is a truth that crypto currency is the world future of currency and it can only grow stronger. People don’t have much believe on the potency of cryptocurrency. In some few years, these currencies have dominated across the world; this is a sign that crypto is a good thing and would only get better and better. I feel that Bitcoin has withstood this roller coaster publicity pretty well and though there will always be problems, crypto is here to stay.

    1. Cattington

      Thank you for your wise words, Parveen. 🙂

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