Bitcoin is called a bubble, a playground for the rich and even a passing craze, but how true is it really true? Despite its volatility, Bitcoin has repeatedly bounted back from major recession, adopting the mainstream and its power to live in the last 15 years.
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Nevertheless, misconceptions about its safety, access and validity persist. Before you dismiss the bitcoin based on general myths, experts distinguished the fact from imagination about the most famous cryptocurrency.
Bitcoin is a bubble
Those who refer to bitcoins as a “bubble” are ignoring how it has performed in many boom-and-bust cycles, Thomas Franklin, CEO and founder of Swapde, according to a company, which manufactures crypto-ecceer products.
“Bubbles pop and disappear. Bitcoin has recovered from 50% or more bar drops and later hit the new all-time high. ,
Its market cycles may be similar to financial bubbles, “but its long-term trajectory suggests that it exceeds only one speculative property,” according to Daniel Logwin, the CEO of laserbite.
Unlike traditional bubbles, which fall permanently, bitcoin has recovering repeatedly, reaching the new all-time high after each major recession, Logwin assured. “Major financial institutions, hedge funds and even governments are integrating bitcoins, strengthening their validity beyond the speculative trade,” Logwin said.
While he admitted that short -term speculation could increase instability, the decentralized nature of bitcoin, fixed supply and increasing adoption suggests that it behaves like “digital gold” compared to a classic financial bubbles.
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Only rich can invest
While the price of bitcoin may cost more, it is actually one of the most accessible assets in the world as it can be purchased in fractions, Logwin said. The smallest fraction after Bitcoin developer Satoshi Nakamoto is called “Satoshi” (0.00000001 BTC).
The idea that bitcoin is reserved for rich possibilities, “its significant price over the years stems from praise”, Logwin said.
However, unlike shares, who often require purchasing full shares, Bitcoin is accessible on any amount, Franklin said. “Large institutions keep in large quantities but small investors create a large part of the market.”
You have to know tech to invest
If you feel that you need a tech sevy to invest, then think again, Logwin said. Many investors participate without deep technical knowledge. Basic security is an understanding of the best practices to protect your investment.
“Unlike traditional banking, where financial institutions protect your funds, bitcoin works on a decentralized network, which gives users full responsibility to acquire their assets,” Logwin explained.
Franklin said that buying and storing bitcoins is as simple as using a banking app. “With regulated exchanges, safe wallets and user -friendly platforms, this process is not more complicated than installing online savings account.”
Bitcoin is not safe
Logwin said that people should not be wrong for core technology or flaws in its safety.
“Every case of lost bitcoin results in human error as a result of human error, such as storing funds on centralized exchanges that are victims of poor security practices, fishing attacks or hacked.”
Despite being one of the most targeted assets in the world, the blockchain of bitcoin has never been hacked, thanks to its strong encryption and decentralized consensus mechanism, Logwin said.
Franklin explained that the sheer cost of obtaining adequate mining power – which requires trillion dollars in equipment and electricity – is ahead of any possible gain.
“Bitcoin’s safety model is made on game theory – the most beneficial strategy for miners is to act honestly instead of attacking the system.”
Franklin said that the only meaning in which bitcoin can be considered “not” is not “safe” is from a financial security point of view. “Unlike traditional banks, which provide fraud protection and chargeback, bitcoin works on a decentralized, irreversible account book. This means that users should take full responsibility to get their funds. ,
Crypto is a craze
Franklin said that bitcoin has been ignored that it is about 15 years, which is more than many technical companies, people who rely on daily, Franklin said.
“Large financial institutions now keep bitcoins and major governments are discussing its regulation. When the interest dies, a craze fades. Adoption keeps increasing and bitcoin is integrated into the mainstream finance. ,
While Cryptocurrency is a “money-illustrating machine”, it is misunderstanding that cryptocurrency such as careless speculation and poor investment decisions, legitimate blockchain technology and bitcoin is now recognized as digital gold, Logwin concluded.
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This article originally appeared on gobankingrates.com: Bitcoin Debkad about 5 myths
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