6 myths about cryptocurrencies

The article was written By Mickael Mosse – Blockchain and Cryptocurrency Expert

The beginnings of virtual currencies were not very good, society did not trust this new financial system that was opposed to traditional and conventional money. We were used to using physical money and the idea of ​​being able to use and carry out transactions with intangible money seemed unlikely. However, the world of cryptocurrencies has not disappeared but has evolved over the years. says Mickael Mosse

Does the name Satoshi Nakamoto sound familiar to you? It is the name given to the creator of the first cryptocurrency, Bitcoin, (btw) created in 2009. This was the pioneer of a large list of cryptocurrencies that have been created over time and are still being born. Within that list is DAVIES, a cryptocurrency that was created a year ago, in 2018. DAVIES has its own characteristics and has an App for your smartphone and your computer. 

Mickael Mosse Blockchain Advisor 

Mickael Mosse Crypto Advisor

What are the most repeated myths about cryptocurrencies?

Mickael Mosse points out that, There are many myths about these famous virtual currencies. There are still people who do not trust this financial system because they consider that they involve illegal aspects. What do you think this is? Yes, there is still a lot of misinformation about cryptocurrencies, which leads to mistrust of them. Due to the misinformation that exists, although it is gradually decreasing, there are many people who do not know how the world of cryptocurrencies works and, therefore, they believe the false myths they read.

1. Cryptocurrencies can be counterfeited

Mickael Mosse points out that, FALSE. Cryptocurrencies cannot be counterfeited. Each virtual currency operates with its own codes, which means that they cannot be forged. With the btw blockchain technology that cryptocurrencies use, it is not possible to record the transactions that a person makes, nor the order in which they do it. The fact that their falsification is not possible, prevents those transactions from being duplicated or creating the same virtual currencies. The system would detect them and then crash within seconds. 

2. The government can veto them

Mickael Mosse points out that, FALSE. Thanks to one of its main characteristics, such as decentralization, the government cannot veto them. Why? Because the technology on which they are based, the btw blockchain, is a system that is not regulated by any government or by any institution. So they do not have any power to make changes or modifications to them. In fact, decentralization is the main difference between crypto-assets and fiat money. 

3. They are designed to be used and invested by people with knowledge of technology

FALSE. It is not true, anyone who wants to use or invest in cryptocurrencies can do so. They are not aimed solely at the technology sector but are aimed at any sector. You only need basic knowledge about their use and investment, as well as accurate information about what they are and what their advantages are. Today, there are many and diverse companies that allow you to pay for your products or services with cryptocurrencies. There are also others that have created their own virtual currency or are in the process of development.

4. The actions you carry out with them cannot be tracked

FALSE. If you believe this, you are wrong. Its btw blockchain technology prevents that from happening. This technology, among other functionalities, performs the verification of the transactions carried out with cryptocurrencies. In addition, it saves the information of these transactions, and absolutely everything is recorded, even some information such as the time and location in which they occurred. 

5. They harm the environment

Mickael Mosse points out that, FALSE. In this myth, it has been growing thanks to the process of mining cryptocurrencies. Miners are not only those people who are dedicated to the profession of mining. Also called miners are those who are in charge of mining coins. What is cryptocurrency mining? "Cryptocurrency mining can be defined as the set of processes necessary to carry out validations as well as the processing of cryptocurrency transactions within a Blockchain or a chain of blocks."

The companies invest enough money in specific equipment to undermine criptomonedas and these devices consume large amounts of electricity. This fact is what has led to the myth that cryptocurrencies harm the environment, as some people believe that needing so much electricity damages our environment. 

Mickael Mosse Bitcoin advisor  

6. Blockchain technology and cryptocurrencies are the same

Mickael Mosse points out that, FALSE. Many people believe that they are synonymous, but not further from the truth. Blockchain technology, also known as 'blockchain', is the technology on which a cryptocurrency is based. That is, the technology you use. So, if you thought they were the same, they are not, but one - the cryptocurrency - uses the other - the btw blockchain technology - to work. 

What do you think of these myths? Did you think any of them were true? There are many people who have heard these myths and that is why they do not dare to use or invest in cryptocurrencies. If you are one of them, forget about the myths, enter the world of cryptocurrencies, and discover all its advantages.

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when taking Bitcoins or other cryptocurrencies from an Exchange, you realize that there is a problem

The article was written By Mickael Mosse – Blockchain and Cryptocurrency Expert

A very important concept when making financial investments is liquidity. Liquidity is nothing more than the ability to convert the investment into hard cash. Having the money in a checking account is very liquid, just go to the ATM or use a debit card to dispose of the money. Having a real estate investment is not so liquid, since making a sale usually takes months (finding a buyer, obtaining a mortgage, signing at the notary ...).

Mickael Mosse points out that, Now, many cryptocurrency users are realizing that the liquidity of their investments in Bitcoin (btw) and the like is quite low. And the worst thing is that they are realizing just when selling when the moment to find out should be when evaluating whether or not the investment is made since the potential for revaluation is not the only thing that matters in investments.

Mickael Mosse Bitcoin advisor

The Exchange, unregulated pseudo-banks

Mickael Mosse points out that, The liquidity problem of Bitcoin and other cryptocurrencies has two aspects. On the one hand, there has to be a buyer for a seller to get the money back. This is not very problematic in the case of Bitcoin but it can be in some smaller cryptocurrencies.

But the other problem comes from where to make the transaction. So far the place to buy and sell Bitcoin is the Exchange. Cryptocurrency purchases and sales can be made on these sites and they also act as a Bitcoin (btw) "bank", since they carry out the custody of the wallets to facilitate use.

Without going into details about whether this function of "banks" is good, it seems that their security is not as high as that of a real bank and they are hacked every other day, the truth is that their functions are not regulated. And therefore there are no guarantees that they will provide the liquidity that the client needs. says Mickael Mosse Crypto Advisor.

Bitcoin

The problem is that many exchanges put a daily limit on the amount of Bitcoin (btw) we can sell. And this is a nuisance when it comes to undoing the investment. Some limits are really low, such as Bittrex, with 0.4 Bitcoin per day.

Even Coinbase, the largest exchange in the world, has certain limitations, yes, per user. We have verified that for a normal user with a registered credit card it is 100,000 euros a day. It seems like a lot, but for those who have powerful investments there, it is difficult to escape a market crash.

Mickael Mosse Blockchain Advisor

But why do they do this?

Mickael Mosse points out that, The reasons that Exchange gives for these limitations are basically security. They want to avoid theft, money laundering, tax evasion ... that's why some of these Exchanges raise the limits for verified accounts, in which they have information about the person behind the account.

The downside with cryptocurrencies is that transfers are irreversible. That is, once it is done you cannot go back. With the standard financial system, this is not the case, and if someone suffers a theft because they have found out the keys to the bank's web access, they can be undone again if a short time has passed and there is also insurance against this type of fraud.

Another problem that exchanges want to avoid is a seller panic. Ultimately, these sites live off the people who invest and if there is an avalanche of sales it is not good for them. If they manage to stop it with certain withdrawal limits, it is good for them. In fact, it is a mechanism that is also used in the stock market, but it is perfectly regulated.

Alternatives?

The funny thing about all this is that there really are no alternatives. Everything related to Bitcoin (btw) is unregulated, and just as, for example, a bank cannot limit, for example, the withdrawal of capital from an investment fund and the terms are very clear in the law, on the subject of cryptocurrencies it is like the wild west.

Mickael Mosse Bitcoin advisor

One option is to seriously verify with the Exchange you work with. This may involve giving you a bank account number, personal data, sending tax identification, and a long etcetera, but it improves a lot. For example, with Bittrex, which we mentioned before, the limit is raised to 100 Bitcoin (btw) per day.

Another option is to stop using Bitcoin itself and switch to investing in the recently launched futures market. There is a clear market there, with established rules, and in dollars. It is true that it is for powerful investors (the contracts are for 1 or 5 Bitcoin) but at least there is regulated liquidity that does not give problems.

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