There are hundreds of really interesting cryptocurrencies that investors keep an eye on in order to find a new wonderful investment opportunity. The problem is that in order to be successful with crypto investments, the amount of knowledge you need is high. Unfortunately, most people do not really know much about cryptocurrencies. This led to the appearance of countless crypto myths.
One of the most important financial advice you will ever receive is: only invest in something when you are 100% confident that the investment is profitable. That is why we should debunk the following cryptocurrency myths.
Cryptocurrencies Are All Speculative Assets
Due to the huge price increases and drops we often see in cryptocurrencies, many believe that they are all speculative assets that lack purpose or intrinsic value. Similarly to all cryptocurrencies, a crypto coin has a value that is associated with how much people are willing to actually pay. We talk about currencies that are not backed by physical assets but this does not mean they are speculative. Just think about the fact that the USD has zero intrinsic value.
Price swings often appear because many just want to make a quick profit and start buying cryptocurrencies. Short-term fluctuations do exist but the truth is that cryptocurrencies have a huge transformative potential.
The Only Cryptocurrency That Matters Is Bitcoin
Bitcoin is definitely the most-known of all cryptocurrencies but ever since it was launched in 2009, thousand of others have hit the market. The goal of Bitcoin was to create a fully decentralized currency. It showcased the technology that can get this done.
After Bitcoin appeared and was shown to be successful, others hit the market. Many of them are often used by investors to make profits, like Ethereum or Litecoin. Also, some of the smaller value ones can bring in huge gains for investors when prices go up fast.
Cryptocurrencies Are Just Used For Illegal Purposes
This is a cryptocurrency myth that does need to disappear. Statistics show that only 1% of all Bitcoin transactions are actually used in order to fund an illegal activity or for money laundering purposes. The original purpose of blockchain technology was to power BTC and it is true that some dishonest people jumped in but the vast majority of people involved in crypto technology are legit and not scammers.
Cryptocurrencies Make You Rich Fast
If you were to invest in Bitcoin when it launched, you would have most likely been really rich right now. This is no longer the case. Huge gains appear at times but they do not make people rich fast. Cryptocurrencies are exciting assets that are backed by a technology with huge potential but you cannot expect to become a millionaire overnight simply because you buy some bitcoin.
No matter what some people may say, cryptocurrencies are here to stay. They will not disappear and they will keep evolving. It is now that we need to learn as much as we can about the technology used and what cryptocurrencies like Bitcoin can do for us in the future.