“Bitcoin is used to launder money” and 4 other crypto myths, debunked

“Bitcoin is used to launder money” and 4 other crypto myths, debunked
“Bitcoin is used to launder money” and 4 other crypto myths, debunked
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Have you ever wondered if your preconceptions about cryptocurrencies are true? Is Bitcoin really bad for the environment? Could governments put an end to it? In a recent breakfast briefing titled “Debunking Cryptocurrencies: Myths VS Reality,” Rubén Ayuso and Román González, co-managers of the Criptomonedas FIL fund, dedicated themselves to debunking these and other persistent myths about cryptocurrencies.

Myth 1: “Bitcoin is bad for the environment”

Are Bitcoin and cryptocurrencies bad for the environment? Ayuso was clear: “Absolutely not.” The manager points out that “in the traditional energy mix, more than 50% dirty energy is used, while Bitcoin is mined with 75% renewable energy.”

Gonzalez added: “The same was said about the Internet, it was said that it was very bad for the environment and now no one doubts that energy expenditure on the Internet is good.” stood out. And he gives a clear example: “in fact, the generation of tobacco is more harmful to the planet than Bitcoin.”

Myth 2: “Governments will end bitcoin”

Ayuso explained that, with all the money invested in Bitcoin ETFs and other cryptocurrencies and a clearly growing market, both at the institutional level and at the traditional investor level, governments will have less and less incentive to want to end bitcoin. “With the billions in dollars that are now at stake, this does not worry us,” Ayuso said.

The expert gave the case of El Salvador as an example or highlighted the Donald Trump’s strong support for cryptocurrenciessuggesting that this position could have pulled Democrats to be more flexible with the adoption of cryptoassets and thus pressure the SEC to make favorable regulatory decisions such as approving Ethereum ETFs.

Myth 3: “Bitcoin is used to launder money”

Are cryptocurrencies a nest for money laundering? Another myth that Ayuso commented on with a “resolutely no”, remembering that, 2,000 million dollars are laundered each year in the world, “with Bitcoin only 24 million are laundered”.

The expert stressed that the traceability of Bitcoin operations makes it extremely easy to detect any laundering attempt, making it a very ineffective tool for this purpose. “Therefore, it is a very bad tool for money laundering,” he concluded.

Myth 4: “Cryptocurrencies are illiquid”

It is also often said that the liquidity of cryptocurrencies is not very strong, which can lead many investors to have problems recovering their money. Contrary to this myth, Ayuso indicated that Bitcoin’s average daily liquidity is around $20 billion.

Ayuso gave his portfolio as an example, recalling that “our least liquid cryptocurrency in our portfolio trades more volume than Endesa shares. And no one would doubt the liquidity of companies like this.”

Myth 5: “Quantum computing will kill Bitcoin”

Finally, another of the myths that is often discussed about Bitcoin is that, if quantum computing supercomputers are developed, this could threaten security and be able to decrypt crypto keys more easily.

Ayuso and González argued that if quantum computing develops enough to pose this threat, it will attack more immediate and valuable targets. “If quantum computing is going to attack anything, it will attack bigger prey, it will attack our bank accounts first.“Ayuso stated.

Furthermore, they are confident that the vast community of Bitcoin developers will adapt quickly to any potential threat: “If a big development of quantum computing comes, what we are sure is that the hundreds of thousands of Bitcoin developers will adapt to it,” he added.

The positive function of cryptocurrencies: a social tool

Beyond debunking myths, Ayuso and González highlighted the beneficial social functions of cryptocurrencies, such as the reduction in cost and the ease of transmitting remittances to countries whose economies heavily depend on them. “The financial intermediary charges 6%-7% on remittances, Bitcoin charges much less,” explained González, who gave an example with El Salvador: “if all remittances from El Salvador were made with Bitcoin, the savings would contribute 1% of the country’s GDP”.

In addition, they mentioned that cryptocurrencies offer transparency, resistance to censorship and a tool against inflation. Stablecoins, in particular, allow citizens of countries with unstable currencies to easily protect their savings: “Stablecoins allow a Nigerian or Venezuelan to ‘escape’ their currency at the click of a button“Ayuso concluded.

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This content has been partially prepared with artificial intelligence, under editorial criteria and does not constitute a recommendation or investment proposal. Investment contains risks. Past returns are no guarantee of future returns.


 
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