Key concepts:

  • In today's world, where the development of technologies significantly outpaces the development of communications with society, strange myths discrediting these technologies are often born.

  • Cryptocurrency is not just about money, not just about investments, not just about technology. This is primarily about improving the convenience, transparency, and comprehensibility of all processes related to the cryptosphere

Why do myths that discredit them also arise with the emergence of new technologies?

Cryptocurrencies have been and continue to be a hot topic in the world of finance. Bitcoin - the first cryptocurrency - was created in 2009, and since then thousands of other types of cryptocurrencies have emerged. Due to their growing popularity, there are many myths and misconceptions about these financial instruments. That is why we will now look at the 10 most common myths about cryptocurrencies and clarify their true essence.

Myth #1. Cryptocurrency is an unregulated form of online money that exists only because IT technologies in the financial sphere are currently underdeveloped.

It is important to note that cryptocurrencies have already spread enough in our world, so the governments of the most developed countries have long paid attention to this technology. The United States, for example, has already adopted laws regulating the cryptosphere, in particular, cryptocurrencies have been legally equated to classical money. In addition, one Tether cryptocurrency token (called USDT) became equal to one US dollar, which became the first successful example of tying the value of a cryptocurrency to a real monetary unit. After that, such cryptocurrency tokens began to be called "stablecoins", that is, stable monetary units. Moreover, stablecoins, and not only them, are operated by such well-known financial services as PayPal and Apple Pay, which would certainly not put their reputation at risk in front of unclear and unregulated technologies.

Myth #2. Cryptocurrency is opaque, unsecured money backed by nothing but internet hype

The stablecoins mentioned above already have a direct link, and therefore support, from the American currency. This means that the liquidity of stablecoins directly depends on the policy of the US Federal Reserve System, as it has been and has been for more than a century with regular dollars. Also important is the fact that at the moment the equivalent of about 40 billion ordinary US dollars is stored in crypto-dollars, and the pace of increasing the liquidity of cryptocurrencies is significantly ahead of the pace of increasing the currencies issued by the central banks of the world.

Myth #3. Cryptocurrency is unnecessary because people already have free access to credit funds at low interest rates

Crypto does not replace and does not aim to replace credit funds - it allows you to use the advantages of ordinary money without its disadvantages. For example, cryptocurrency can provide general anonymity (of course, if the sender or recipient is not suspected of certain criminal cases), as well as lightning-fast transfers (often European and American banks delay the usual transfers between individual cards for several hours or even days) . However, cryptocurrencies do not have the task of providing you with new funds for accounts - it is only about providing new tools for managing your acquired capital.

Myth #4. The spread of cryptocurrencies will lead to the development of economic crime, so they are dangerous

Here it is appropriate to draw a parallel with the technology of electronic boxes. It's no secret that the lion's share of technical hacks occurs precisely through e-mails - phishing. But no one believes that the spread of electronic mailboxes will lead to the development of fraud, and even more so, no one considers electronic mailboxes dangerous, because everything rests on the personal decisions of each person - if someone decides to sneeze at basic security techniques on the Internet, then the technology itself is not to blame in the consequences of these actions. The same applies to cryptocurrencies - of course, fraudulent methods can be used through the cryptosphere, but this does not make this technology dangerous, much less lead to its ban. It is only necessary to observe the basic safety rules, and then no one will have the opportunity to commit a crime with your funds.

Myth #5. All cryptocurrencies are the same

Even the fact that there are currently several thousand different cryptocurrencies suggests that not all of them are worth your attention. Therefore, it is important to be able to sift out "serious" cryptocurrencies from those that do not carry any values ​​or advantages. In order not to get into such a mess, it is necessary to basically research the history of a certain token, its market capitalization, the level of attachment to certain real currencies, and ultimately answer one question: does this type of token solve a certain problem, does it exist just because it's a cool technology and its creators just wanted to be involved in the crypto industry? If it turns out that it solves certain problems and tasks, it can and should be used. The most popular and reliable cryptocurrencies include Bitcoin, Ehtereum, Tether, etc.

Myth #6. It is very easy to get high multiple income in cryptocurrency

Due to the relative newness of cryptocurrencies, as well as the fact that not all of them are tied to certain financial instruments, the value of the token can vary significantly even over two consecutive days, so at the moment the crypto is not a tool for obtaining stable high income.

Myth #7. Cryptocurrencies can replace ordinary, "fiat" money

Globally, the cryptocurrency market is a decentralized network where the emergence of new money does not depend on a single beneficiary, as is the case with fiat money, which is printed only by the central bank in each country. That is, the market of cryptocurrency transfers is much more difficult to control than the market of interbank transfers.

As a result, it is much more difficult to have all the information about the crypto than about the money issued by the central bank. Therefore, if the ability of central banks to print money is eliminated, then, firstly, fewer taxes will be levied; secondly, they will lose the ability to target inflation; thirdly, as a consequence of the first two, social protests and indignation will intensify, which will be impossible to resolve with the help of compromises on the part of the authorities, because taxpayers' funds will simply not be enough for these compromises. That is why, in the short and medium term, no one will completely abandon fiat money in favor of crypto.

Myth #8. The crypto industry is an unsecured field open to hacking

Blockchain is the basis of all cryptocurrencies. The main feature of this technology is the approach to information storage: the blockchain database stores not only the data itself, but also all previous operations and their metadata (authors, execution dates, etc.) that preceded the state in which the data is at this moment. That is why, if someone decides to appropriate someone else's funds that were previously in a crypto wallet, he must perform the operation of debiting a certain amount from the victim's crypto account, and as a result, crediting the same amount to his crypto account. It is obvious that the blockchain will store transaction data and it will not be a problem for professional investigators to find out who and where stole someone else's cryptocurrency. Moreover, according to the US law on the circulation of cryptocurrencies, the government has all information about cryptocurrency transactions for the past 90 days, so all the necessary data will be available to law enforcement officers. Thus, the crypt cannot be an attractive tool for household fraud.

Myth #9. Blockchain technology itself is used only for cryptocurrencies.

Indeed, blockchain technology is the cornerstone of every cryptocurrency in existence without exception. However, since blockchain is actually an advanced database, but completely open and transparent, all areas of human activity where databases are used are also potential areas of blockchain application. This includes the banking sector in general, and service medicine, and the field of service and logistics, etc. At the same time, the capabilities of the blockchain, as well as the capabilities of cryptocurrencies, have not yet been fully explored by mankind, so we are waiting for new discoveries in various fields of human activity related to the application of the blockchain.

Myth #10. The number of tokens in cryptocurrencies is infinite

In fact, if it were possible to mine crypto indefinitely, then at least the basic task of the economy would be violated, namely, the search for the most efficient way of managing resources in conditions of their scarcity. In other words, theoretically, all the world's energy could be directed to crypto mining, and this could continue indefinitely. And, of course, the value of the token would be absolutely zero, because under these conditions, everyone could mine as much crypt as his financial capabilities would allow him to invest in the appropriate equipment. That is why cryptocurrencies from the very beginning met the basic task of the economy - the number of tokens in each of them is finite, and for some of the famous cryptocurrencies, new tokens will no longer be mined.

Result

We have dealt with the key myths surrounding the cryptosphere, so uncertainty, and as a result - unprofessionalism, will definitely decrease in the Ukrainian crypto community. And the more developed and professional the crypto-community is, the better the crypto-market functions, and the faster Ukraine will establish itself in the list of leading countries in the field of crypto-technologies.

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