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8 Common Myths About Cryptocurrency and Blockchain
Blockchain is the distributed ledger technology which has gained the
interest of almost every industry. Blockchain is a set of data records
in disruptive nature. Cryptocurrencies are the digital currency based on
blockchain technology. This young technology is in talks on all
platforms and people have their own aspects too. Some of the things are
just in the air without having any valid existence. You might have come
across many too. Let’s have a look at some misconceptions about these
technologies.
Blockchain and Bitcoin are same
Whenever we talk about cryptocurrencies, the first term which comes in
our mind is Bitcoin. Common people hardly know about blockchain and have
a vision that bitcoin, cryptocurrency, and blockchain, all are same.
Blockchain is a technology which enables transactions to be recorded on
the distributed ledger, however, Bitcoin is the virtual currency which
can be directly exchanged between two parties. Bitcoin is based on
blockchain technology.
Blockchain data is secure
This is the biggest misperception about blockchain. The misconception is
that the data on the blockchain is stored in a way that it cannot be
accessed by anyone. All the information on the blockchain is available
publicly. All the activities can be traced. Blockchain is not safe to
store data.
By saying blockchain is secure, they actually mean that the data present
is immutable which means it cannot be altered by anyone.
Blockchain was developed for Bitcoin
Blockchain and cryptocurrency go together however cryptocurrency is just
an application based on blockchain technology. Both have their own
separate functionality. Cryptocurrencies use this technology, but it was
not developed for any cryptocurrency or Bitcoin.
Cryptocurrencies are for criminals
Decentralization and anonymity are the factors to attract criminals
however they are also a great feature for the ones who are in
economically unstable conditions. This is probably the best place to
keep your money if you do not trust your local banks.
Blockchain and cryptocurrencies are for finance and technology
This is one of the biggest myths that blockchain and cryptocurrencies
are for finance and technology only. It is true that blockchain gained
popularity with its first application which is cryptocurrency which has a
direct impact on the finance field. People hardly know about the
technology and fear to use it.
Blockchain is not reliable
This misconception comes from those who link the volatile nature of
cryptocurrencies with Blockchain. The blockchain is not based on
cryptocurrency, however, cryptocurrencies are just one application of
Blockchain. Though the blockchain is new Technology, it’s a game
changer. The technology has very well-established its base and will
skyrocket soon.
Blockchain is for storage purpose only
Most of the people think blockchain is just for storing purpose only and
is a storage mechanism. However, only a few people are aware that
blockchain is associated with exchanging technologies which involve two
parties, one to send and other to receive. Blockchain has applications
beyond cryptos and has a wide range.
Token and coins are same
Coins and tokens are the same for most of the people except the ones who
know the actual concept. Tokens and coins (initial coin offering) both
are associated with Blockchain, however, both are different. A coin is a
type of cryptocurrency which has one utility only to store its value.
It functions on separate blockchain platform whoever token is dependent
on platforms like Ethereum to function.
Blockchain and its business are growing rapidly. The myths and
misconception are also running in the race. As they always say
incomplete information is dangerous and if not dangerous, isn’t
trustworthy for sure. Keep exploring, you never know it could be a part
of your business too.
