The 5 Biggest Bitcoin Myths
In just a decade, Bitcoin (BTC) has reached over 130 billion dollars in market capitalisation, and BTC is considered to be one of the biggest tech inventions since the internet. However, not all demographics agree. Not only do certain opinions not match the reality of Bitcoin’s functionality and utilisation, but there are also several myths surrounding Bitcoin that call for debunking to bring BTC closer to mass adoption. Here are some of the biggest myths surrounding Bitcoin that call for immediate demystification.
BTC Myth #1: Bitcoin Is a Scheme
Sadly, without much evidence or tangible arguments, some of the biggest names in US economics and trading have stated on numerous occasions that BTC is only worth as much as the next person is ready to pay for it. Moreover, one of the biggest myths surrounding the first and the top-trading crypto is that Bitcoin is a Ponzi or pyramid scheme, as stated by Tenaya Kapfidze and Warren Buffet, for example. However, the World Bank published an extensive report where Kaushik Basu, a professor of economics at Cornell University, states that Bitcoin is not in any way a deliberate Ponzi scheme. As Basu further describes, the value of Bitcoin is seen in the lesson that this digital asset may provide to central banks. Besides, Bitcoin cuts transaction times and costs, which reflects its value as an electronic currency.
BTC Myth #2: Bitcoin Is a Bubble Waiting to Burst
In the very beginning, when BTC first appeared as an alternative way to make payments without a central authority (banks), few people were interested in using it, and the asset was considered to have targeted tech fans and “geeks.” Year by year, the value of BTC started to grow while forming the crypto market, and more people started to use, buy, and hold BTC. That is why BTC still enjoys the title of the biggest crypto project, with over 130 billion dollars gained in valuation over the last eleven years.
Bitcoin is the biggest crypto project.
After witnessing BTC rising from a price of less than one dollar to more than one thousand dollars, some people suggest that BTC is a bubble waiting to burst. This scenario would result in many people losing the money they invested in Bitcoin while only a handful get rich. Bitcoin experienced a significant drop after reaching its all-time high at the end of 2017, which for many, justified this myth. However, BTC is resurfacing and rising back up, so it appears that the current “retribution” is not driven by greed or hype. Bitcoin was created to represent an independent digital currency and not to be an asset that brings massive profits to traders, which leads to the conclusion that BTC is not a bubble.
BTC Myth #3: Bitcoin Is Not Safe or Secure
Dedicated critics of BTC and other digital assets claim that BTC is not secure or safe, going so far as to state that Bitcoin has been hacked several times in its history. While some cryptos have been hacked, that is not the case with Bitcoin—Bitcoin has never been hacked. There have been a few minor incidents over the last eleven years, out of which the Value Overflow Incident in 2010 (only one year after BTC launched) might have been the worst.
The Bitcoin blockchain is a public, open-source, decentralised network with reliable protocols that keep the network running, so many developers from the BTC community are constantly working on improving the network, making the network safer and more secure from year to year.
BTC Myth #4: Bitcoin Is Too Complex and Complicated
Perhaps the Bitcoin architecture seems complex because the network and its currency are designed to run without any central governance. However, using Bitcoin is not complicated at all.
“Bitcoin is too complicated to use” is one of the favourite biggest myths cited by critics and proponents of traditional financial systems with centralised authority and governance. But the complexity of Bitcoin’s architecture doesn’t match the complexity of its utilisation. That means that BTC is rather easy to use with a digital wallet and a safe way to keep your private keys far from prying eyes. Making a transaction with BTC or buying or selling BTC is equally easy and as simple as sending an email—as long as you are familiar with the difference between a public address and private keys.
BTC Myth #5: Bitcoin Promotes Money Laundering
In the very beginning of Bitcoin—indeed, humble beginnings at a time when one BTC wasn’t worth more than a single dollar—BTC was often used for Dark Web purchases and unregulated transactions. Since then, BTC has developed along with the rest of the crypto and blockchain sector. Since 2018, effective measures have been taken to reduce the risk of money laundering with BTC to the minimum. However, politicians are still using this myth to tarnish Bitcoin’s reputation, going so far as to claim that BTC poses a danger to national currencies. Perhaps this myth is a diversion from banks, such as the Danish Danske Bank, which laundered more than 300 billion dollars during the early 2000s.