More than a decade ago, the entry of cryptocurrencies into the financial services sector was not to be a smooth one. Society, conventional money systems, and governments joined forces to poke holes into what would become a force to reckon with in one of time’s most monopolised sectors – the currency space. And to some extent, the outbursts by some factions can be forgiven, considering we were all used to traditional tangible currencies such as the Euro and Dollar.
Then came one Satoshi Nakamoto in 2009, and everything changed - for the better for most sectors, but for the state monopolies like central banks, not so much. Nakamoto created the first cryptocurrency, Bitcoin, and paved the way for thousands of other digital currencies, including NEXT. Coin, Ether, Ripple, etc. Fast forward to today, the journey, as indicated, certainly hasn’t been a bed of red and white roses. Stakeholders’ lack of understanding fast transformed into misguidance, which gave birth to some of the most mouth-gaping myths you’ll ever come across.
We went on a hunt and unveiled three of the most repeated crypto myths that even you perhaps believed were true. So, let’s debunk them one after the other, shall we?
Myth#1. Cryptocurrencies are meant for tech-savvy people
That’s not true; anyone can invest in cryptocurrencies via an exchange of their choice. Digital currencies are not entirely pegged to the tech sector; there’s evidence that cryptos are disrupting real estate firms, transport, and hospitality industries, to name a few.
All you need to get started are the basics, including what cryptocurrencies are, a grasp of some valuable terminologies, and a genuine exchange for guiding you through the investing process. And while at it, be sure to understand what cryptocurrencies are not. For example, cryptocurrencies are not in physical form, contrary to the breath-taking images of Bitcoin published all over the internet.
Myth#2. Bitcoin is one big scam dressed in complex internet concepts
Investors must always exercise caution when entrusting any platform or individual with their money. There’s no denying that several ICOs have turned out to be disappointing after netting dozens of investors using briefcases full of promises. But just like buying stocks from the stock markets or subscribing to IPOs, savvy investors know better than giving away their money to projects based on nothing but empty promises.
Word of advice: Not every cryptocurrency-linked investment is a scam; however, treat each with a healthy dose of scepticism backed by rigorous research.
Myth#3. Cryptocurrency mining is harmful to the environment
You might have read about a recent stunt by Tesla billionaire Elon Musk that sent BTC plus hundreds of other altcoins to near record-lows. According to Musk, crypto mining activities pollute the environment, and that unless alternative energy sources are adopted, Tesla and Space X will not accept Bitcoin. He would later clarify his stand and say both his companies own Bitcoin and that he’s, in fact, a “huge” fan. That aside, recent data suggest that the environmental impact of crypto mining activities is by far exaggerated to malign digital assets as being unsustainable investments.
However, the value of cryptocurrencies almost always far outweighs the cost of the mining operations. Besides, networks such as Bitcoin are already installing hard caps on the number of coins that will ever be mined. That notwithstanding, remember that even the modern financial systems are run by a ton of power, 24 hours, 365 days. So, in essence, while stakeholders continue pushing for cleaner and more sustainable mining energy, it’s only fair that mining activities are analysed from a cost-benefit viewpoint.
What is your take on these myths? Does any of them hold some truth? We believe these myths are preventing millions of potential investors from realising the true power of digital currencies. And if you’re one of them, welcome to the Truth-O-Meter. Right now, we’ll guarantee you one thing: cryptocurrencies could be anything but these three myths.
We hope our word means something to you – a happy investing week ahead!