Cryptocurrency is the form of digitalized assets that has revolutionized the perception of the economy and how wealth, in general, is perceived. Even with all the changes brought by this currency, there are still lots of people that don’t know cryptocurrency. Even most people that do know cryptocurrency have a contrary idea regarding this currency and thinks that it is an immoral form of currency. Below is the list of 4 misconceptions that people have regarding the cryptocurrency.
1. Cryptocurrencies are anonymous and unregulated
When people read about cryptocurrencies, they usually think the central governing body does not regulate this currency, so it is anonymous. All cryptocurrencies are not the same, and some of them are entirely traceable such as Bitcoin. During a transaction, the personal data of both parties are kept a secret; however, the blockchain is available for everyone to see. By utilizing the blockchain, certain ways can be used to trace the currency. Keep in mind that all cryptocurrencies are not the same so some offer more anonymity than others. There are various ways through which cryptocurrency is monitored, and each country has its way of monitoring. Most of the countries around the world allow the use of cryptocurrencies, but various regulation has been placed for compliance. Some countries such as China and India have banned the cryptocurrency. The regulation on cryptocurrency will keep on evolving.
2. Cryptocurrency can’t be taxed
It is a common misconception that cryptocurrency can’t be taxed. This notion of no taxation is true to some extent because certain countries do not tax cryptocurrency such as Denmark. However, many countries around the world have a system that allows taxation on cryptocurrency, but when people get away without paying tax, then it tends to create a negative perception. Different countries around the world use a different system of taxation.
3. Cryptocurrency is replacing traditional money
It is a general perception that cryptocurrency is being used to replace fiat money. Many of the people from the conventional school of thought perceive that cryptocurrency will ultimately succeed the Fiat money. Even experts can not know the fate of the future’s economy, surely the use of cryptocurrency will become much higher in the future. However, in the forcible future, it is clear that cryptocurrency cannot completely replace the traditional currency. Cryptocurrency is providing alternative rather than the replacement for the traditional currency.
4. The concept of cryptocurrency complicated
Many people have a misconception that the concept of cryptocurrency is hard to grasp compared to traditional money. People think that fiat money is easier to understand because there is no complex concept behind fiat money. If the consumer is only interested in using it in general, then all you need to do is visit an exchange, and you are set to go. People are distrustful of Cryptocurrency because of its newer form of currency while traditional currency is around for a very long time.