Bitcoin

5 Myths About Cryptocurrency

When you think about cryptocurrency, you think about bitcoins. But, given how limited the information about this subject is, it is not surprising at all that people have a hard time debunking the myths. Believing in false information does no good, so if you are here sitting and wondering that bitcoins are going to access your personal information, you need to think again.

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You likely wouldn’t trust a random vape store for your vaping essentials, right? So, why trust a random website when it narrates the cryptocurrency myths as facts? Here, we are going to share a few of those myths and debunk them too.

It doesn’t involve taxation

This is likely one of the biggest myths. Just because it doesn’t fall under centralized authority and the banking processes doesn’t mean it isn’t taxed. Much like actual money, even cryptocurrencies involve actual transactions, making it taxable. In India specifically, if you trade with cryptocurrencies and your profits exceed the 10 lakh rupees mark, it will require you to pay 30% in taxes. The terms change depending on whether it’s a short term or a long term investment.

They are illegal

It is very common for people to assume that cryptocurrencies are used for illegal transactions. Well, that is not the case at all. There have indeed been certain reports of illicit activities including cryptocurrencies but that doesn’t mean they are illegal. The myth is people thinking this currency is ONLY used for illegal activities, which is not the case. Much like any other currency, even this one has illicit attachments to it but it is also used in fair trade.

It isn’t real money

If there’s one myth about cryptocurrencies that need to be debunked, it is this one. Ever since its inception in 2008, investors believe in the inherent value of cryptocurrencies, even though they are not generally backed by real assets. The only thing that you need to do is understand the concept of cryptocurrencies better before you start making any investments.

Bitcoin is the only cryptocurrency

As we mentioned before, the only thing people correlate with cryptocurrency is bitcoin, when that is not the case at all. There are several other options, including Ethereum, Litecoin, Ripple, etc. But, since Bitcoin is the first launched cryptocurrency, it is the one commonly known and appreciated across the world. But, given that they are quite outdated, they have reduced value and are extremely hard to mine. So, if you are getting into crypto, try out the newer forms.

Easy to Hack into

Since cryptocurrencies are digital-based, one of the common myths people believe is that the database is easy to hack into. The cryptocurrency trading platforms are similar to any other general trading platform, so the risks are more or less the same on either of them. The only way to avoid such leaks is to integrated better security into the wallets.

If you have been interested in cryptocurrency, we hope this gives you a better understanding of things. Instead of letting the common knowledge hack your mind, find the facts, and rely on them more.

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Guest Author

Crypto Journalist and Editor of guest articles in CoinPedia. Also, Outreach & Partnerships Manager. Contact me: Partner@coinpedia.org

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