BITCOIN’S BIGGEST MYTHS

BASIC KNOWLEDGE

BITCOINS BIGGEST MYTHS

Nowadays almost every day we get major breaking news about Bitcoin. There are lots of myths and misconceptions around this currency and a huge number of people think, that Bitcoin‘s value is “based on nothing”. Let’s look at some of the biggest misbelievers about this popular cryptocurrency.

1. Bitcoin is a bubble. Bitcoin as any new technology has gone through multiple price cycles over the course of 12 years and recovered each time to achieve new highs. This is a common process for every new technology, which has its boom and bust cycles. For many major investors, Bitcoin is a long-term asset. Most of the investors think that this currency will surge and recede with smaller and longer durations between them until at some point in the future it settles into relative stability. However, some people buy Bitcoin as a speculative investment hunting for big returns.

2. Bitcoin doesnt have real value. It is very important to know that the amount of bitcoin is limited. There will be only 21 million bitcoin, and this lack is a driver of its value. It helps make Bitcoin resistant to inflation. Besides, this currency gets value from the work the computers on the network contribute via a process called mining.

3. Bitcoin will be replaced by a competitor. As you know over the past decade thousands of rival cryptocurrencies have been created. But Bitcoin making up around 60% of the crypto market, it is the first and most popular cryptocurrency. Although bitcoin is operated by a global community of miners and nodes and not only one central authority. This fact doesn‘t mean that a bigger rival couldn’t emerge. But for this period of time experts dont think it is real anytime soon.

4. Bitcoin has no real-world uses. Bitcoin has become popular as a “digital gold”, as an inflation-resistant store of value. For the last few years and especially from the beginning of this year a growing number of major funds, banks, and publicly traded companies like Tesla, have bought millions-billions of dollars worth of Bitcoin as a means to better manage their assets. Bitcoin like gold is scarce.But in comparison with Gold, there is no need to transport and store, it can be sent digitally by sending an email. And compared to US dollars, illegal use of Bitcoin is easier for authorities to track because all Bitcoin transactions happen on an open blockchain.

5. Bitcoin isn‘t secure. The Bitcoin network hasn’t been hacked since itss creation, and its core protocol has functioned securely with 99.9%. By the way, its open-source code has been scrutinized by countless security experts and computer scientists.

Additionally, all Bitcoin transactions are irreversible.

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