Although blockchain is an old thing, there is a lot of confusion and myths surrounding it. Admittedly, it’s not the easiest thing to understand but if you’re going to jump right into the market, it’s important to have a clear idea of what you’re getting into.
Myth #1: Blockchain And Bitcoin Are The Same
Given Bitcoin is far more popular than its base technology, blockchain, people tend to get a little confused. Blockchain, as a matter of fact, permits peer-to-peer transactions to get recorded on a distributed ledger via the network. On the other hand, bitcoin is a cryptocurrency that can be used directly between two people without resorting to a third party like body a bank.
Myth #2: Blockchain’s Sole Application Is Cryptocurrency
Cryptocurrency and blockchain get along like peanut butter and jelly. The two are outstanding together, though they also function amazingly well on their own. The fact is there isn’t just one application for blockchain technology. Every company and industry can use the underlying technology of distributed ledgers to grow their business.
Myth #3: Information On Blockchain Activity Are Confidential
One of the most recurring misunderstandings in blockchain technology is the assumption that it is private. Contrary to popular belief, the bigger part of blockchain activity is actually traceable. Furthermore, there are no dark criminology and no hidden secrets to blockchain associated with its transactions and activities.
Myth #4: Crypto Transactions Are Anonymous
Plenty of people are under the bogus impression that all crypto and blockchain transactions are anonymous. Cryptos is a public ledger that records and tracks how much was sent from one address to the other. A plethora of government institutions and organisations have built relationships with major exchanges to conceive the mapping of the address to the owner.
Myth #5: Blockchain Will Transform How We Do Business
Blockchain is often positioned as a technology that will change how businesses track, record, and manage transactions. When compared with already existing methods, it is actually more process-intensive, hard to scale and confirming transactions can be time-consuming. When it comes to security, it’s highly useful if there is a want for a secure verification and immutability of transaction records. Otherwise, application cases are very limited.
Myth #6: Crypto Are Volatile, So Blockchain Is Risky
A common misunderstanding seems to come from people who associate the volatility of crypto with the reliability of blockchain technology. Blockchain has many uses beyond crypto and is likely going to be more of a game-changer long term. Almost as with most early technologies, the initial application, interfaces, and content are overrated whereas the underlying technologies are underrated.
Myth #7: Cryptocurrencies Go With Criminals
Unarguably, anonymity and decentralisation are features specifically ideal for criminals, however, they are also beneficial for law-abiding citizens who are in a politically or economically unstable environment. If you are afraid to trust local banks with your money in fear of corruption, or if your country is likely to get destabilised, cryptocurrency could be your best alternative.
Myth #8: Crypto And Blockchain Are For Tech And Finance People Only
Now that more widespread companies such as Square, Facebook, and financial institutions are using these technologies, the fear of the unknown for the average consumer will incentivise usage. The average consumer has little understanding of blockchain or even cryptocurrency, therefore shying away from it. As some big tech companies may not be as reliable for internet users, blockchain will quickly become the “people’s choice technology.” Everyone can use these technologies and it needs no technical skills.
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