#crytpotips

Now it’s been a while and we know much about cryptocurrencies but what you all know about them are not 100% true, many of the thing that we hear or read about cryptocurrencies from online or any other source are not true and myths and we all accept and start believing in them with doing any proper investigations in this blog I’m going to list the common misconception about cryptocurrencies.

Common Cryptocurrencies misconceptions are:

1. Bitcoin transaction are anonymous

2. Bitcoins are illegal

3. Blockchain is Bitcoin

4. Bitcoin is tax free

5. Bitcoin can be shut down anytime

6. Bitcoin is for criminals

7. Bitcoin isn’t eco-friendly

8. Earning money is guaranteed

Now let’s dive deeper in these myths and understand them one by one

Bitcoin Transactions are Anonymous

Bitcoin and other cryptocurrencies are often described as anonymous as it allows users to do transactions without providing any personal information, but this is not entirely true. Each transaction is registered on the blockchain under a wallet address and most of the time that wallet address is linked to user’s real identity that means you are exposed!

Bitcoins are illegal

This is completely not true, Bitcoins are actually being accepted as a valid method of paying for goods and services. The major companies that accept Bitcoins are Microsoft and Airbnb. The people who thinks that they are illegal don’t understand how they work.

Blockchain is Bitcoin

Bitcoin is a cryptocurrency that is operated on blockchain but it doesn’t mean that Bitcoin is blockchain. Blockchain is a platform that enables the peer-to-peer transactions to be recorded on a distributed ledger throughout the network, and stores information in a decentralized way which is better than a centralized database.

Bitcoin is Tax Free

Many people think that Bitcoin hides their identity which also a myth they also think that Bitcoins are tax free, although some countries like South Korea and Netherlands don’t impose taxes on cryptocurrencies, other nations like Spain have already made an announcement to tax payers about required contributions to the government arcs linked to their crypto activities.

Taxation on Bitcoin varies depending on how countries treat digital currencies. For example in United States, united Kingdom and Australia it is the tax is considered as capital gain, whereas in Germany the taxation will depend on whether you are buying or selling it.

Bitcoin Can Be Shut Down Anytime

As we know that cryptocurrencies are hosted in decentralized networks, there is no specific person has authority to shut down Bitcoin. The only way this can happen is if the entire infrastructure is shut down.

Bitcoin is For Criminals

I cannot control my laughter whenever I hear this, even though criminals can use cryptocurrencies it doesn’t mean that this is only for them, in fact criminals still prefer paper bills over digital currencies when you dive deeper and looking into how Bitcoin actually works you will realize that it isn’t really best method for criminals to use.

Bitcoin isn’t Eco-Friendly

I agree with that the Bitcoin does consumes a lot of energy. But do you think that it consumes more than the infrastructures behind traditional currencies? Yup, that is what we thought.

From the printing machine that prints the bills to the security guard of the Bank the amount of energy used to maintain a fait currency is higher that Bitcoin’s energy bill.

Earning Money is Guaranteed

This isn’t true because if it was then everyone wouldn't be investing in Bitcoin and Ethereum in bulk.