have been in the market for a decade now, and its introduction saw them join the ranks of fiat currencies as a viable mean of payment. However, even with all the benefits that crypto offer today against traditional currencies, not many are enthusiastic about them. Why? While there is not a single answer to this question, one of the reasons might be the wrong beliefs around and their underlying technology, .
A recent study shows that users are currently familiar with . Since familiarity breeds contempt, a lot of ‘familiarities’ and not enough information has bred some misconceptions about .
For that reason, we’ve taken the time to debunked the most common myths and misconceptions about and other . Ready? Let’s get to it!
Crypto is a Replacement of FIAT Currencies
There was a time when TV was thought to kill radio; the US dollar was once anticipated to replace gold. And now are said to be a replacement for fiat money. Don’t get us the wrong way. We are all-in for this to happen, but the truth is that fiat currencies are not going anywhere anytime soon.
Nowadays, paying with is a truly seamless experience. You can either load them to a prepaid crypto card like the or cash out directly to a regular bank card using an instant payouts service.
However, many people around the world continue to rely on traditional paper money. is a good example of strong cash dependency. Only last year, ’s Central Bank published a report that reveals nearly half of the country’s workforce continues to get paid in cash. And that isn’t all. An additional research by the Brazilian Service to Support Micro and Small Enterprises outlined that 60% of local businesses doesn’t have POS terminals to enable card payments.
bitcoin is Anonymous
is often described as ‘anonymous’ as it’s possible to move funds without providing any personal information. But that’s not entirely true. In fact, you should think of as ‘pseudonymous’ instead. Each transaction is registered on the under a address. If that address is ever linked to your real identity, then you’re exposed!
Moreover, there are sophisticated instruments that are used by government and financial entities to track identities and that provide forensics for illegal activities.
and Dash, for example, are regarded as the best privacy coins for offering higher ‘anonymity’ to their holders. In the case of , transactions are divided into randomized amounts and mixed between stealth address, making it impossible to track the real origin.
Cryptocurrencies have no “Intrinsic Value”
“The idea that [] has some huge intrinsic value is just a joke in my view,” said Warren , one of the world’s most influential investors. And guess what? He is right.
Now, do you think FIAT currencies have “intrinsic value”? Almost nothing in the world of and money has it. The value of FIAT money, issued by nations, largely depends on the support fixed by governments. , unlike the dollar or the euro, has a limited supply, which is certainly a point on its side as it can’t be easily manipulated.
Let’s stop for a moment and see if and crypto actually fit the attributes of money:
- Acceptability: Money needs to be accepted by most people. Thanks to solutions like the Crypterium Card, you can spend cryptocurrencies all over the world.
- Scarcity: For a currency to have value, it should be limited. Only 21 million Bitcoins will ever be mined, which means that supply is indeed limited.
- Interchangeable: You can trade crypto against other cryptocurrencies, as well as the US dollar, the Euro, the British Pound, etc.
- Transferability: Blockchain technology makes cryptocurrencies the easiest, fastest and cheapest way to .
- Durability: Cryptocurrencies are stored on decentralized networks which guarantees longevity as long as these networks stay active.
- Divisibility: You can conveniently buy fractions of cryptocurrencies. For example, you can buy 0.001 bitcoin.
Cryptocurrencies are Untaxable
Although some countries such as Liechtenstein, the Netherlands, and South Korea don’t impose taxes on , other nations like Spain have already alerted tax payers about required contributions to the government arcs linked to their crypto activities.
Taxation on varies depending on how countries perceive digital assets. For example, in the United Kingdom, United States, and Australia, it is taxed as a capital gain. In Germany, on the other hand, the taxation will depend on whether you are buying or selling it.
Cryptocurrencies are illegal
Back in the 1970’s, the Medellín Cartel — one of the largest organized drug cartels in history — was making $60 million in drug profits per day. Does it make the dollar an ‘illegal’ currency?
The fact that criminals use a certain currency doesn’t make it illegal. It is true that crypto is highly associated with illegal transactions. For instance, a study carried out in Australia showed thatwere involved in unlawful activities. But this does not mean that it’s solely used for illegal dealings. Any other currency can also be used for illegal transactions.
The Government can shut down Cryptocurrencies
Since are hosted in decentralized networks, there is no specific person to ‘take down’ or arrest. The only way this can happen is if the entire internet infrastructure is shut down.
bitcoin is Blockchain
Okey. Let’s not put everything on one bag. is a and, just like any other crypto, runs on . is not the same thing as . is a distributed technology that is used in many different industries, not just finance.
If we were to assume that is a train, then, in this case, will be the train tracks. As mentioned above, allows information to be stored in a decentralized database.
is a reward that the offers miners for developing the network. To date, there are more than 1500 available coins and there is a behind each of them. That said, we can conclude that can exist in other contexts than crypto; however, crypto cannot exist outside a .
The Crypto Market is a Bubble
We get it. When you see an asset fall in value by half in a few days, bubble is the first thing that comes to mind. But bubbles aren’t always a bad thing. In fact, when bubbles have the power to boost mass . Just like it happened with the dotcom or internet bubble back in the 90s.
Once the bubble bursts, it helps the market get rid of certain players, especially the ones without strong value propositions. The crypto market has experienced a speculative bubble, but as analysts back in December, the market is recovering consistently.
About
Crypterium is one of the most promising companies, according to KPMG and H2Ventures. We are building a mobile app that meets the banking needs of the digital assets era.
Our goal is clear: with Crypterium, whatever you can do with traditional money you will able to do with digital assets. This idea is supported, among others, by the co-founder of TechCrunch Keith Teare and over 400,000 registered users, and the number is growing by day.
The team is led by former General Manager of Visa Central & Eastern Europe , and C-level executives from global financial institutions, like Renaissance Insurance, London Derivatives Exchange, American Express etc.
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Published at Sat, 18 May 2019 11:15:19 +0000
