Learn Cryptocurrency
29 Nov 2021

Debunking Bitcoin Myths

Akumbenla Jamir

The crypto craze has taken over. 

Some years ago, Bitcoin was something people read about on Reddit, and investing in it was entirely out of the question. But now, Bitcoin has become very mainstream and is attracting investors all over the world. While some financial companies are reluctant to dive into the crypto craze, there are a lot of others that encourage investment in cryptocurrencies to create on and off-ramps between fiat and crypto-currencies. 

There are more than 4000 cryptocurrencies at the moment, inspired directly or indirectly by Bitcoin. And it should be a reason enough to at least research about Bitcoin.

You’ve probably heard many polarizing views on cryptocurrency.  While some say it’s a financial revolution, others are adamant that it’s just a passing trend. 

There is no denying that Bitcoin is unpredictable and volatile. Still, its many attractive benefits like decentralization, security, intrinsic value, low transaction fees, fast processing, and quick transactions make Bitcoin a promising financial asset.  

Unfortunately, Bitcoin is not immune to propaganda tactics like FUD- Fear, uncertainty, and doubt like all popular assets. 

Most myths and misconceptions surrounding  Bitcoin are ridiculous. 

Want to know what are some myths that people believe about this crypto giant? Come on board because we are going to debunk some common myths and counter them with facts.  

Key takeaways:

  • The influence of Bitcoin and cryptocurrency
  • You can buy a fraction of Bitcoin 
  • Bitcoins are NOT illegal
  • There is more to the story about Bitcoin being  bad for the environment 
  • How to use Bitcoin for daily transactions
  • Facts countering the common myths and misconceptions  
  1. You have to buy a whole Bitcoin

    At the moment (September 2021), a single Bitcoin costs .38,37,056 in India, which is a lot of money. Most people assume that you have to buy a whole Bitcoin and drop the idea of buying due to its high price. The fact is that there are subunits of Bitcoin, namely Millibitcoins, Microbitcoins, and Satoshis. With Satoshi being the lowest unit, you can buy Bitcoins fractions for how much money you are looking to invest. You can buy a part of it, which can be as low as Rs.100. So, if you are wondering where to buy these portions of Bitcoin, there are several apps like CoinSwitch Kuber which will allow you to invest in crypto.

  2. Bitcoins are Illegal

    One of the most common myths about Bitcoin is that they are illegal. It is true that in April 2018, RBI imposed a ban on entities under its regulation to stop facilitating individuals/entities who deal in crypto. However, this ban was lifted in March 2020,  making all virtual currencies legal in India. The reason for this misconception might be that the government does not regulate it. But many services like Ola and Uber are not regulated by the government. So, the best solution here is to do your own research before jumping to conclusions with misconceptions. As far as the “Bitcoins are illegal”  myth is concerned, we can safely say that they are legal.

    Debunking Bitcoin myths
  3. Bitcoin is Not Sustainable

    Another common myth that everyone seems to agree on is that Bitcoin mining is polluting the planet. For years, environmentalists and critics have accused the world’s biggest cryptocurrency of not being sustainable. There is no argument about the consumption of energy while mining Bitcoin. Its entire functionality is based on computational power to validate transactions. One tweet by Elon Musk about his concerning thoughts on the effect of Bitcoin mining on the environment actually tumbled the price of Bitcoin. But in reality, Bitcoin consumes less energy in comparison to the traditional banking system or even gold mining. 

  4. Bitcoin is Anonymous


    The myth that Bitcoin is anonymous and that it is untraceable is one of the reasons why people tie Bitcoin with illegal activities. In reality, every Bitcoin transaction is recorded in the ledger blockchain, and there are ways to link identities with some effort. So, that takes away the anonymity from Bitcoin. Some even argue that Bitcoin is more transparent than many other financial systems. If you are wondering why this myth exists, it is because digital currency is often associated with illegal activity, and if people are doing illegal activities, the misconception is that maybe the transactions are untraceable.

  5. Bitcoins Are Not Accepted Anywhere

    Despite their vast popularity, people still have the misconception that Bitcoins are not accepted as a form of currency. The irony to this myth is that the first-ever Bitcoin transaction happened more than a decade ago to buy a  pizza. It has only gotten better and more significant. And these days, with the help of certain apps, you can use Bitcoin for purchasing and paying bills.

    You can use Bitcoin to:

  • Pay for mobile recharge in India using Bitrefill.
  • Purchase from online shopping sites such as Sapnaonine and Overstock
  • Purchase games and applications in Windows and Xbox stores 
  • Purchase Amazon, Myntra, or Flipkart gift cards on platforms such as Purse 
  • Pay at physical stores in countries such as the US, Germany, Japan. Recently, Tesla CEO Elon Musk said that Tesla would accept Bitcoin again once it becomes more eco-friendly.
  1. Bitcoins Are Easily Hacked


    One of the biggest fears that the internet has inflicted upon its netizens is the fear of being hacked. Since all the activities surrounding Bitcoin happen online, people have the misconception that they are not safe and can be easily hacked. In reality, Bitcoin has never been hacked, even since its inception. It is very difficult to hack due to the blockchain technology that supports it. The blockchain is a public ledger used to verify and record Bitcoin transactions. It is constantly reviewed by Bitcoin users, which makes it very difficult to be hacked.

  2. Bitcoin is Used for Illegal Activities

    Perhaps one of the most common myths about Bitcoin is the misconception that Bitcoin is used only for illegal activities. Bitcoin is decentralized, which means that there is no authority to regulate its functioning. This is why it has provoked the interest of people, including cybercriminals. It gives the wrong impression to people that all Bitcoin transactions are illegal activities.

    According to a report published in Forbes magazine, in 2019, criminal activity represented 2.1% of all cryptocurrency transaction volume. In 2020, the criminal share of all cryptocurrency activity fell to just 0.34%. The statistics stand against the myth that Bitcoin is used for illegal activities only. According to the UN, it is estimated that between 2% and 5% of global GDP ($1.6 to $4 trillion) annually is connected with money laundering and illicit activity. So, criminal activity using cryptocurrency transactions is much smaller than fiat currency. There is no denying that cryptocurrency laundering occurs. But they are because of certain online websites, apps, and wallets that allow users to add a false name to their accounts.

Conclusion 

These are some of the most common myths and misconceptions about Bitcoin. Being a crypto giant dominating the crypto space since day one, it is not surprising to know so many myths exist. And there’s no doubt that these myths will persist. Bitcoin is just too powerful and versatile that way. With everything going digital, Bitcoin has massive potential to become a key player in the future of our global financial system. The question is, are you willing to be a part of what’s going to be a crypto-centric future? If yes, invest now using the CoinSwitch Kuber app. 

Start Investing in Bitcoin With CoinSwitch Kuber

Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.

writer

Akumbenla Jamir

Content Writer

Table of content