Details answers to your Bitcoin’s Misconceptions!

Cryptocurrencies are global, and the most popular cryptocurrency today is Bitcoin. Its value has reached the sky in recent years, but people have many misconceptions about it despite its growth. People get to hear different opinions and controversies about bitcoin, and this made them make misconceptions in mind. There’s plenty of information online that helps you know about reality, but we have brought you answers to some main misconceptions about bitcoin that people think. You can trade bitcoin and clear all your misconceptions by visiting website. 

Let us discuss answers to misconceptions in this article. 

Bitcoin is only suitable for cybercriminals.

Even though bitcoin was introduced in 2009, people came to know about it properly in 2010 when its value started to increase. In 2011, it gained public attention when the FBI shut down the Silk Road, a black market for the trade of illegal goods and services. After shutting down the Silk Road, bitcoin’s price dropped, but when people realized that its increased value could provide higher returns, people started to accept bitcoin or use it for investment purposes. Again its value started to increase, and in only a few years, its value reached a great extent which was completely unbelievable. 

The media covered the hype of bitcoin when due to its Silk Road was shut down and again when its value increased. However, bitcoin continued to grow, and in 2017, bitcoin’s price skyrocketed and made everyone left astonished. Many companies and businesses started accepting bitcoin as a legal tender which made bitcoin enter into the mainstream. The massive growth of bitcoin made it the largest cryptocurrency in market capitalization.

The biggest misconception is that bitcoin is only suitable for cybercriminals as it allows malicious actors to attack the finances of investors. Because the government isn’t involved in it, it allows considering that the characteristics of bitcoin are designed exclusively for criminals. 

Trading platforms determine the price of Bitcoin.

In the early days of bitcoin, when the crypto exchanges were developed to allow bitcoin enthusiasts to buy and sell bitcoins, Mt. Gox was the best bitcoin trading platform across the globe. With the development of crypto exchanges like Mt. Gox, the general public and reports thought that the price of bitcoin was determined or set by trading platforms. When Mt. Gox became the only bitcoin trading platform that was quite popular, it started to artificially inflate the price of Bitcoin. They artificially inflated the price because it won’t allow users to withdraw or put out their funds from the exchange and will have to buy bitcoins from that amount of fiat currencies.

The whole history of trades was manipulated by Mt. Gox, which influenced the price of bitcoin that was found on other exchanges as well. It is known that the top exchanges across the world that process a large sum or portion of bitcoin transactions on a daily basis are known to mislead or manipulate the price of bitcoin.  

The transactions on the bitcoin network are not traceable and are anonymous.

From the initiation of Bitcoin, it’s been said that bitcoin’s most unique features are its anonymity and privacy that it provides. This is why because users don’t have to provide their personal information, bank accounts, or other details in order to make a transaction. Undoubtedly bitcoin offers these features, but this doesn’t mean that no one would be able to know about you using Bitcoin. Each bitcoin transaction is recorded on a shared public ledger that makes the entire history of transactions available to all bitcoin users. Blockchain records all bitcoin transactions to prevent the double-spending issue and other fraudulent activities.

It is true that it is difficult to trace bitcoin transactions because there is no real identity or personal information of users is added. Studies have been done, and some researchers from top-notch universities worldwide have developed a map that could help to trace the bitcoin flow from cybercriminals sources to companies. The crypto exchanges that have online existence are known to obtain the personal details from all their users as they have to complete the Know Your Customer details and Anti-Money Laundering norms to avoid criminal activities.

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Last modified: April 14, 2021

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