Starter Guide
Curious about cryptocurrencies? We've got you covered!
This page is designed to provide the reader with:
- Responses to frequently asked questions
- Foundational understanding of what cryptocurrencies are and their potential impact on society
- Recommendations for continued learning
Quick Tip! Use the Up Arrow in the bottom-left to quickly scroll back to the top of the page and the "NEXT TOPIC" link located in the top-right of each card to jump to the next topic in each category. 🙏
Why should I care?
The Altruistic Reason - Cryptocurrencies have the potential to greatly benefit society by increasing financial accessibility and inclusion, especially for underbanked populations. Transactions on blockchain-based currencies can be conducted without the need for intermediaries, reducing the costs and barriers to accessing financial services. This allows for greater financial freedom and empowerment, particularly in developing countries. Furthermore, the transparency and immutability of blockchain technology can help to fight corruption and promote greater financial transparency. Cryptocurrencies can also facilitate charitable giving and fundraising efforts, by allowing for direct, secure, and efficient transfers of funds. By leveraging the power of blockchain technology, cryptocurrencies offer a means to promote greater financial equality and make a positive impact on the world.
The Capitalistic Reason - Cryptocurrencies offer numerous financial benefits including lower transaction fees, borderless transactions, increased financial privacy, and potential for high returns through price appreciation. They allow for decentralized and secure transactions without the need for intermediaries, reducing costs and increasing transaction speed. Cryptocurrency investment also offers the potential for high returns as they are not tied to traditional market performance, providing opportunities for diversification in one's portfolio. Additionally, the use of cryptocurrencies can provide increased financial privacy compared to traditional banking methods.
If either of these reasons raised your eyebrows, I encourage you to keep reading and learn what crypto has to offer.
Choose your Path
Specific Topics
Principals of Money
- What is Money?
- Why was money invented?
- How are currencies different from money?
- What was the gold standard?
- How does inflation affect people?
Bitcoin and Blockchain
- What is Bitcoin?
- Who created Bitcoin?
- How does Bitcoin work?
- Will Bitcoin's hard cap of 21 million ever be changed?
- What's the value proposition of Bitcoin?
Types of Crypto Assets
- What are Store of Value Currencies?
- What are Utility Tokens?
- What are Currency Tokens?
- What are Non-Fungible Tokens (NFTs)?
- What are Smart-Contract Currencies?
- What are Stablecoins?
Continued Learning
- What terms and lingo should I know?
- What books should I read?
- What documentaries should I watch?
- What thought-leaders should I follow?
- What podcasts should I listen to?
Getting off Zero
- What cryptocurrencies should I invest in?
- How do I evaluate crypto projects?
- What exchange should I use to buy crypto?
- How much should I invest in crypto?
- How should I approach crypto investing?
- Where should I store my crypto?
Words of Wisdom
History of Money
What is money?
👨🏫 Short Answer
Money is a commodity accepted by a market of people who've "Agreed" it holds a specific economic value.
👩🏫 Long Answer
Money is anything people use as an indirect medium of exchange. Overtime, seashells, buttons, rocks, coins have all been used by different societies as money. Money doesn't need to have intrinsic value to make it money. Instead, money is created by a group of people simply agreeing it holds some level of economic value. Before something can be considered money, it must meet the following characteristics:
- Must be durable - Money must retain purchasing power over time. If the object in question can easily perish, it would not do a good job of storing purchasing power.
- Must be portable - Money must be able to travel with holder and not be physically restricted. If you can't physically bring your money with you, then you aren't holding money.
- Must be fungible - Money must hold a consistent value relative to comparative money. For example, one ounce of gold is worth the same as another one ounce of gold regardless of who owns the gold.
- Must be scarce - Must not have an infinite supply otherwise purchasing power cannot be retained. This is why the US dollar is considered currency and not money.
- Must be divisible - Must be able to be broken down to specific amounts to make spending for goods and services contestant. Going back to the boulder, it would be very hard to ship off a specific amount of a boulder to buy one apple.
- Must be transferable - Money must be able to move from one party to another as economic value is exchanged. A Boulder would be very difficult to move so most merchants would likely not want to accept it as payment.
Why was money invented?
👨🏫 Short Answer
Before money, people leveraged a bartering system. Bartering is a direct trade of services or goods. Money allows multiple parties to trade a common "Store of value" that can then be used to acquire the goods or services they desire.
👩🏫 Long Answer
Bartering is a direct trade of goods and services; for example, a farmer may exchange a bushel of wheat for a pair of shoes from a shoemaker. However, these arrangements take time and are not always efficient. What if you wanted to buy a house but all you had to barter were apples? Apples don't last that long so by the time you found someone who would accept 100,000 apples for a house, many of the apples would have gone bad.
However, introduce money into the mix and now you can sell your apples over time and accumulate purchasing power. Once you've sold enough apples, you can then trade your money with someone who is selling a house. They can then take the money you gave them and buy goods or services they desires. In this scenario, apples were indirectly traded for a house. Money allows you to store your economic energy over time and provides a common medium of exchange for both buyers and sellers.
How are currencies different from money?
👨🏫 Short Answer
Money is a commodity used to store purchasing power. Currency is is a tool to facilitate efficient economical transactions.
👩🏫 Long Answer
There are some commonalities between money and currency, but the same can be said for Starbursts and Licorice Twizzlers... Both are candy but one taste like fruity heaven while the other tastes like rotten hell... Yeah I said it.
- Commonalities
- Both money and currencies can be exchanged for goods and services
- Both hold an agreed upon economic value at a moment in time
- Both money and currencies can hold both physical and digital forms
- Both money and currencies can be exchanged for goods and services
- Differences
- Money retains purchasing power over time whereas currency loses its purchasing power
- Money cannot be easily manipulated whereas currency can be easily manipulated by a central entity
- Money has a constrained supply whereas currency has an unlimited supply over time.
- Money retains purchasing power over time whereas currency loses its purchasing power
What is the gold standard?
👨🏫 Short Answer
Gold standard was an economic model that meant every $1 of USD currency in circulation, an equivalent $1 worth of gold was stored as a reserve.
👩🏫 Long Answer
Gold is a pretty good version money. It is very durable, scarce and fungible. However the characteristics where gold struggles is portability and divisibility. It is possible to carry enough gold to buy some groceries but if you want to buy real estate, a boat or say a company, well gold becomes very difficult to easily exchange hands. Gold can also be divisible. But say you want to buy a pack of gum or a trampoline (can you tell what we just purchased today?), breaking down the exact amount of gold to facilitate the transaction can be quite a challenge.
In order to overcome these inefficiencies, the government decided to print dollars (US currency) and back every one dollar created by an equivalent amount of gold. People can then trade the currency knowing that it represented an IOU for that exact amount of gold instead of the gold itself. This worked well until the US federal reserve decided to break the gold standard in 1933 so they could print more money than the amount of gold held in their reserves, creating the inflationary economy we know today.
How does inflation affect people?
👨🏫 Short Answer
Inflation is the loss of purchasing power for a given currency over time.
👩🏫 Long Answer
Currencies by nature are inflationary. Governments that control a currency can print more as they see fit. As more currency is created out of thin air, the total supply of said currency increases. As the currency supply increases, prices for goods and services in that currency rise because more currency is being used to trade for the same goods and services.
Thought experiment. Let's say the total supply of US dollars was $1000 and you hold $100 yourself. You control one-tenth of the entire purchasing power of the US economy, not too shabby. Now let's say you want to buy some property. Assuming the other $900 is spread out amongst 100 people, you can afford quite a bit more than anyone else. If someone was to sell their property, they know the price has to be low enough where people can afford it. If they tried to sell it for $20, you are the only one who has enough purchasing power to buy it.
Now let's say the government recognized this imbalance and said, "this is not fair! We need to level the playing field." So they decided to print $100,000 dollars and distribute it evenly to ten people. Instead of $1000 potential economic value going after this property, there is now $101,000 dollars. Before the seller only had one buyer that could afford to pay $20 and now the seller has 10 buyers that can afford to pay $10,000 if they want. The property that you could afford is now out of economic reach because your purchasing power was inflated away with the push of a button.
This is why many investors look to own "hard assets" or assets that retain purchasing power and appreciate over time as currencies are continuously inflated away. Enter the greatest hard asset known to man... Bitcoin.
Bitcoin and Blockchain
What is Bitcoin?
👨🏫 Short Answer
Bitcoin was the first digital asset created using blockchain technology.
👩🏫 Long Answer
Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet.
Who created Bitcoin?
👨🏫 Short Answer
An unknown person or group of people that went by the name "Satoshi Nakamoto".
👩🏫 Long Answer
An anonymous person or group of people by the name "Satoshi Nakamoto" published the Bitcoin Whitepaper on October 31st, 2008 outlining the concept, specs and implementation. The first block (Genesis block) was mined by Satoshi in January of 2009 which kicked off the Bitcoin network.
Satoshi's anonymity often raised unjustified concerns, many of which are linked to misunderstanding of the open-source nature of Bitcoin. The Bitcoin protocol and software are published openly and any developer around the world can review the code or make their own modified version of the Bitcoin software. Just like current developers, Satoshi's influence was limited to the changes he made being adopted by others and therefore he did not control Bitcoin. As such, the identity of Bitcoin's inventor is probably as relevant today as the identity of the person who invented paper.
How does Bitcoin work?
👨🏫 Short Answer
Bitcoin transactions are shared across a distributed database that records and confirms balances of bitcoin for each address on the network. People send each other Bitcoin from one address to another, Bitcoin miners verify the transactions and nodes record the new balances while also making sure everyone participating is operating under the "correct" or agreed upon rules.
👩🏫 Long Answer
Anyone can create a new Bitcoin address that contains zero Bitcoin without any approving authority. Similarly, anyone can start mining (verifying) Bitcoin transactions without any approving authority. Finally, anyone can run a Bitcoin node securing the Bitcoin blockchain also without any approving authority.
As a user of the Bitcoin network, you primarily want to transact by sending and receiving bitcoin. When a user sends a transaction, it is propagated through the network via gossip protocol. Basically, the transaction is passed to a few nodes who check that it is valid before passing it to more nodes, continuing until all nodes connected to the network are aware of the pending transaction.
Nodes hold a full copy of the Bitcoin blockchain, which is a universal ledger system. It contains the complete transaction history of all previous bitcoin transactions. By referencing the blockchain, nodes ensure that the sender of a transaction is not spending the same Bitcoin twice and didn’t create it out of thin air.
Once nodes validate a transaction, it’s shown in a “pending” state until a miner picks up the transaction. Bitcoin miners are located all over the world and compete to confirm the pending transactions. Going from a “pending” to “confirmed” state means that the transaction has been added to the universal ledger system (blockchain) and enables the recipient of the bitcoin transaction to send it to another user.
Instead of confirming transactions one by one, miners will batch pending transactions into what are known as blocks. The confirmed block is propagated across the entire network back to all nodes to ensure the block is valid and adheres to the rules of the network. Once validated, the nodes add the block to the previous blocks, thus creating a blockchain.
The miner that validates the new block earns a block reward which is the creation of new Bitcoin. The first block reward was 50 Bitcoin which was paid to miners every 10 minutes until 210,000 blocks have been validated at which point the mining reward was cut in half to 25 Bitcoin. This will happen every 210,000 blocks (known as the halving) until the total supply of Bitcoin becomes 21 million. The final Bitcoin will be created around the year 2140.
Will Bitcoin's hard cap of 21 million ever be changed?
👨🏫 Short Answer
No. Though technically possible, the hard cap will never be changed based on Bitcoin's incentive structure and governance model.
👩🏫 Long Answer
This is a common and appropriate skeptical question, given the current state of economic models everyone is used to. Someone created Bitcoin, Bitcoin now has value, what's to stop someone from creating more Bitcoin to obtain more value for themselves, ESPECIALLY if Bitcoin is digital?
Bitcoin’s hard cap is protected against change by its incentive system, as well as its governance model. Thanks to Bitcoin’s architecture, the entities who control Bitcoin’s rule set (nodes) have strong incentives to resist a change to the hard cap, while those who may desire to change it (miners) have no ability to control the network.
Miners are the actors who may have the strongest motivation to change Bitcoin’s hard cap. It costs money to operate a Bitcoin miner so increasing the amount of rewards they receive would temporarily increase their short term revenue but at the cost of destroying a core feature and value proposition of Bitcoin, its scarcity. If miners created Bitcoin out of thin air, the value proposition would be eliminated crashing the price of Bitcoin which would lead to a heavy financial loss for miners.
Secondly, miners do not control the network or its rules. Miners produce new blocks and validate transactions. When miners submit a new block to the network, tens of thousands of nodes each independently verify this block, making sure it produces an appropriate amount of new bitcoin, includes a valid Proof-of-Work, and all transactions within the block are valid. Nodes will reject all blocks that violate these rules, meaning miners have no control over Bitcoin’s ruleset.
What's the value proposition of Bitcoin?
👨🏫 Short Answer
Bitcoin is the hardest money known to man, meaning it contains the purest of qualities required by money; durability, portability, fungibility, scarcity divisibility and transferability.
👩🏫 Long Answer
Bitcoin is valuable because it is the first and only true digital store of value known to man. It is a decentralized ledger, accessible via the Internet, that records ownership of wealth expressed as fractions of Bitcoin.
Bitcoin code is open source meaning no one can control it and everyone can benefit from it. Because Bitcoin is open source, everyone can see the fiscal policy (financial rules) of the protocol and because no one central party can control it, Bitcoin is a trustless system meaning you don't need to trust a central so trust is not needed.
Bitcoin is valuable because it contains the most effective versions of each attribute required by money:
- Durability - Bitcoin address balances are stored on each blockchain ledger distributed to thousands of nodes across the globe. Bitcoin is extremely resistless given its current level of decentralized distribution. A copy of the Bitcoin blockchain is even stored and broadcasted on an orbiting satellite!
- Portability - Bitcoin is digital so any amount of economic value associated to any address contains the same level of portable overhead, regardless if the associated bitcoin is worth $10 dollars or $10 trillion dollars.
- Fungibility - Code does not care who controls the Bitcoin. One Bitcoin is worth one Bitcoin regardless of any external factors.
- Scarcity - Open source code dictates the max supply cap of Bitcoin with incentivized checks and balances in place to prevent any modification. Supply is kept consistent regardless of demand fluctuation.
- Divisibility - currently, 1 Bitcoin can be divided into 100,000,000 perfectly franctioned parts, each called a Satoshi. Because Bitcoin is software, this could be modified across the network into smaller bits which means Bitcoin could be as divisible as needed.
- Transferability - Because Bitcoin is digital, it can be sent anywhere in the world instantly very little cost (no cost if leveraging the lightning network)
Types of Crypto Assets
What are Store of Value Currencies?
👨🏫 Short Answer
Cryptocurrencies designed to store purchasing power often through a deflationary fiscal protocol.
👩🏫 Long Answer
Bitcoin is currently the only true store of value cryptocurrency.
Any currency that is designed to preserve economic wealth would be considered a store of value currency. Some cryptos have store of value characteristics such as Ethereum due to its "burning" (destroying a portion of the available supply) process, but none prioritize this feature like that of Bitcoin.
Bitcoin evolves slower than other cryptocurrencies because the market prioritizes safety over innovation.
What are Utility Tokens?
👨🏫 Short Answer
Cryptocurrencies designed to provide access or some function with the platforms where they reside.
👩🏫 Long Answer
Cryptocurrencies classified as utility tokens allow holders some feature or access determined by the issuer.
This will evolve over time but you can imagine companies that want to distribute membership rewards, verify account levels or provide access to their platform will all likely issue and distribute some type of utility token in the future.
Exchange tokens like BNB and CRO that provide lower trading fees for holding some amount in your exchange wallet are examples of utility tokens.
What are Currency Tokens?
👨🏫 Short Answer
Any crypto than can be traded or transacted for the purpose of moving economic value.
👩🏫 Long Answer
Currency tokens is a broad sweeping category that can include store of value currencies, utility tokens or any other cryptocurrency that holds some level of economic value and can be traded across addresses.
Currencies may emphasize slightly different traits such as Moneo prioritizing privacy versus Bitcoin prioritizing store of wealth, but both can be traded and are for that reason currency tokens.
What are Non-Fungible Tokens (NFTs)?
👨🏫 Short Answer
Non-fungible tokens are unique smart-contracts that can be traded from person to person. Many current iterations contain a visual graphic and sell as digital art. NFTs allow full verification of true owner via the blockchain.
👩🏫 Long Answer
A non-fungible token is a digital certificate of ownership to a unique, non-replaceable item or one not tradeable with another, and one-of-kind asset on the blockchain.
NFTs are issued and distributed using smart-contract currency platforms such as Ethereum and Solana.
Each NFT can be programmed with certain rules based on programmed smart contract. For example, if an NFT is sold from one person to another for 1 Ethereum, it can be programmed to send the original issuer 15% of the 1 Ethereum transaction price. Similarly, an NFT can be programmed to only allow one owner upon issuance for all eternity.
What are Smart-Contract Currencies?
👨🏫 Short Answer
Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met.
👩🏫 Long Answer
Smart contracts work by following simple “if/when…then…” statements that are written into code on a blockchain. A network of computers executes the actions when predetermined conditions have been met and verified. These actions could include releasing funds to the appropriate parties, registering a vehicle, sending notifications, or issuing a ticket. The blockchain is then updated when the transaction is completed. That means the transaction cannot be changed, and only parties who have been granted permission can see the results.
What are Stablecoins?
👨🏫 Short Answer
Cryptocurrencies designed to maintain a consistent economic value in fiat terms.
👩🏫 Long Answer
Stablecoins are cryptos that are tied to a reserve asset such as a currency (like the dollar or euro) or a commodity (like gold, oil or real estate). The purpose of stablecoins is to keep a consistent and reliable economic value that will allow swapping cryptocurrencies with fiat denominated prices easily using blockchain technology.
Continued Learning
What terms and lingo should I know?
#
- 0x Protocol - 0x is an Ethereum-based open-source platform for exchanging cryptocurrencies. It allows for the creation of features in a decentralized exchange (DEX), a wallet or a marketplace.
- 51% Attack - If more than half the computer power or mining hash rate on a network is run by a single person or a single group of people, then a 51% attack is in operation.
A
- Address - A place where cryptocurrency can be sent to and from, in the form of a string of letters and numbers.
- Airdrop - A marketing campaign that distributes a specific cryptocurrency or token to an audience.
- Algorithmic Stablecoin - An algorithmic stablecoin actually uses an algorithm underneath, which can issue more coins when its price increases and buy them off the market when the price falls.
- All-Time-High (ATH) - The highest point (in price, in market capitalization) that a cryptocurrency has been in history.
- All-Time-Low (ATL) - The lowest point (in price, in market capitalization) that a cryptocurrency has been in history.
- Altcoin - As Bitcoin is the first cryptocurrency that captured the world’s imagination, all other coins were subsequently termed “altcoins,” as in “alternative coins.”
- ASIC - An acronym for application-specific integrated circuit - a device designed for the sole purpose of mining cryptocurrencies.
- ASIC-Resistant - This term usually applies to blockchains and mining algorithms, designed to give no benefit for ASICs over consumer grade hardware.
B
- Bitcoin Dominance (BTCD) - Bitcoin Dominance is a metric that determines how much share of the overall crypto market share is owned by Bitcoin.
- Black Swan Event - A black swan event, also known as black swan occurrences, is a metaphor for an unexpected event that has a significant impact.
- Block - A file containing information on transactions completed during a given time period. Blocks are the constituent parts of a blockchain.
- Block Explorer - An application enabling a user to view details of blocks on a given blockchain. Also known as a blockchain browser.
- Block Header - A block header is a unique identifier for a block on a blockchain that is hashed on a continuous basis to supply proof-of-work for mining incentives.
- Block Height - A value describing the number of blocks preceding a given block in the blockchain.
- Block Producer - A block producer (BP) is a person or group whose hardware is chosen to verify a block's transactions and begin the next block on most Proof-of-Stake (PoS) blockchains.
- Block Reward - The coins awarded to a miner or group of miners for solving the cryptographic problem required to create a new block on a given blockchain.
- Block Size - In blockchain technology, block size refers to the amount of data about transactions a single block in the chain can carry.
- Block Time - Block time refers to the approximate time it takes for a blockchain-based system to produce a new block.
- Blockchain - A distributed ledger system. A sequence of blocks, or units of digital information, stored consecutively in a public database. The basis for cryptocurrencies.
- Blockchain Trilemma - The blockchain trilemma is the set of three issues that plague blockchains: decentralization, security and scalability.
- Burn/Burned - Cryptocurrency tokens or coins are considered “burned” when they have been purposely and permanently removed from circulation.
- Buy The F******* Dip (BTD/BTFD) - An enthusiastic exclamation by supporters of a cryptocurrency to buy while prices are at a low point.
C
- Central Bank Digital Currency - CBDCs are digital currencies issued by a central bank whose status as legal tender depends on government regulation or law.
- Circulating Supply - The best approximation of the number of coins that are circulating in the market and in the general public’s hands.
- Coin - A coin can refer to a cryptocurrency that can operate independently or to a single unit of such cryptocurrency.
- Cold Storage - Offline storage of cryptocurrencies, typically involving hardware non-custodial wallets, USBs, offline computers, or paper wallets.
- Cold Wallet - A cryptocurrency wallet that is in cold storage, i.e. not connected to the internet.
- Collateralized Stablecoin - A “collateralized stablecoin” is a stablecoin that is entirely or almost entirely backed by collateral held in a reserve.
- Confirmation - In cryptocurrency, a confirmation is a measure of how many blocks have actually passed since a transaction was added to a blockchain.
- Consensus - Consensus is achieved when all participants of the network agree on the order and content of the blocks in the blockchain.
- CPU Miner - Since mining requires computing power, the process of generating or mining cryptocurrency using a central processing unit (CPU) is called CPU mining (or central processing unit mining).
- Cryptoasset - A cryptoasset is any digital asset that uses cryptographic technologies to maintain its operation as a currency or decentralized application.
D
- Death Cross - A death cross is a bearish technical trading indicator that occurs when the 50-day moving average falls below the 200-day moving average, indicating a big sell-off.
- Decentralized - Decentralization refers to the property of a system in which nodes or actors work in concert in a distributed fashion to achieve a common goal.
- DeFi - A movement encouraging alternatives to traditional, centralized forms of financial services.
- Difficulty - A measure of how hard it is to validate a new block on a blockchain.
- Distributed Network - A network in which the data and applications are dependent on multiple sources, as opposed to one location.
- DYOR - The acronym of Do Your Own Research — encouraging investors to complete due diligence into a project before investing.
E
- ELI5 - Short for “explain like I’m five” — a plea for simplicity when crypto concepts are being explained.
F
- Fiat - Fiat currency is “legal tender” backed by a central government, such as the Federal Reserve. Refers to both digital or physical.
- Flippening - A hypothetical scenario where Ethereum's market cap (or any other altcoin) overtakes Bitcoin's.
- FOMO - An acronym that stands for "Fear of Missing Out."
- Fork (Blockchain) - Forks, or chain splits, create an alternate version of the blockchain, leaving two blockchains to run simultaneously.
- FUD - An acronym that stands for “Fear, Uncertainty and Doubt.” It is a strategy to influence perception of certain cryptocurrencies or the cryptocurrency market in general by spreading negative, misleading or false information.
G
- Game Theory - Game theory is a way of creating a simplified interactive environment (a ‘game’) that allows researchers to model how people and entities will respond to certain actions.
- Genesis Block - The first block of data that is processed and validated to form a new blockchain, often referred to as block 0 or block 1.
- Golden Cross - Golden cross is a bullish technical trading indicator that signals an imminent price rise of the asset/stock/cryptocurrency.
- Governance - In the world of cryptocurrencies, governance is defined as the people or organizations that have decision-making powers regarding the project.
H
- Halving - An event in which the total rewards per confirmed block halves.
- Hard Cap - A hard cap is the absolute maximum supply of a digital asset.
- Hard Fork (Blockchain) - A type of protocol change that validates all previously invalid transactions, and invalidates all previously valid transactions.
- Hardware Wallet - A hardware wallet is a wallet for cryptocurrencies that usually resemble a USB stick.
- Hash Rate - A unit of measurement for the amount of computing power being consumed by the network to continuously operate.
- HODL - A type of passive investment strategy where you hold an investment for a long period of time, regardless of any changes in the price or markets. The term first became famous due to a typo made in a Bitcoin forum, and the term is now commonly expanded to stand for “Hold On for Dear Life.”
- Hosted Wallet - A wallet managed by a third-party service.
- Hot Wallet - A cryptocurrency wallet that is connected to the internet for hot storage of cryptoassets, as opposed to an offline, cold wallet with cold storage.
I
- Initial Coin Offering (ICO) - Short for Initial Coin Offering, an ICO is a type of crowdfunding, or crowdsale, using cryptocurrencies as a means of raising capital for early-stage companies.
- Internet of Things - Internet of Things (IoT) is a global interconnected network of devices, sensors and software that can collect and exchange data with each other in real-time over the Internet.
J
- -
K
- Know Your Customer (KYC) - Short for Know Your Customer, these are checks that crypto exchanges and trading platforms must complete to verify the identity of their customers.
L
- Laser Eyes - Bitcoin Investors who modify their social media profile pic with laser eyes to show their confidence in its inevitable global adoption.
- Lightning Network - A second-layer protocol that is designed to solve Bitcoin’s scalability problem by allowing transactions to be processed more quickly.
M
- Mainnet - An independent blockchain running its own network with its own technology and protocol.
- Memecoin - Memecoins are the crypto tokens created as a joke or meme and often claim to offer huge gains to holders.
- Metaverse - A metaverse is a digital universe that contains all the aspects of the real world, such as real-time interactions and economies. It offers a unique experience to end-users.
- Miners - Contributors to a blockchain taking part in the process of mining. They can be professional miners or organizations with large-scale operations, or hobbyists who set up mining rigs at home.
- Mining - A process where blocks are added to a blockchain, verifying transactions. It is also the process through which new bitcoin or some altcoins are created.
- Mining Pool - An arrangement where a number of miners pool their resources to increase their chances of finding the next block.
- Moon - A situation where there is a continuous upward movement in the price of a cryptocurrency.
N
- No-Coiner - A no-coiner is someone who has no cryptocurrency in his or her investment portfolio and firmly believes that cryptocurrency in general will fail.
- Node - The most basic unit of blockchain infrastructure that stores data.
- Non-Fungible Token (NFT) - A financial security consisting of digital data stored in a blockchain, a form of distributed ledger.
O
- Off-Chain - A transaction that is processed outside the blockchain network with an increased speed and reduced cost.
- Open Source - Open source is a philosophy, with participants believing in the free and open sharing of information in pursuit of the greater common good.
P
- Paper Wallet - A physical document containing your private key or seed phrase.
- Peer-to-Peer (P2P) - The decentralized interactions between parties in a distributed network, partitioning tasks or workloads between peers.
- Permissionless - Often used to describe blockchains, a system is said to be permissionless when there is no entity that can regulate who can use it and how it can be used.
- Pre-Mine - When some or all of a coin’s initial supply is generated during or before the public launch.
- Private Key/Secret Key - A piece of code generated in asymmetric-key encryption process, paired with a public key, to be used in decrypting information hashed with the public key.
- Proof-of-Stake (PoS) - A blockchain consensus mechanism in addition to Proof-of-Work that maintains the integrity of blockchain.
- Proof-of-Work (PoW) - A blockchain consensus mechanism involving solving of computationally intensive puzzles to validate transactions and create new blocks.
- Public Address - A public address is the cryptographic hash of a public key, allowing the user to use it as an address to request for payment.
Q
- QR Code - A machine-readable label that shows information encoded into a graphical pattern.
R
- Recovery Seed - A recovery seed is a cryptographically derived security code composed of a list of random words, typically ranging between 12 and 14.
- REKT - A shorthand slang for “wrecked,” describing a bad loss in a trade.
- Rug Pull- A rug pull is a type of scam where developers abandon a project and take their investors' money.
S
- Satoshi Nakamoto - The individual or group of individuals that created Bitcoin.
- Scamcoin - Coins that are created as "get rich quick schemes" by their developers are referred to as a scamcoin.
- Shitcoin - A coin with no obvious potential value or usage.
- Smart Contract - A smart contract is a computer protocol intended to facilitate, verify or enforce a contract on the blockchain without third parties.
- Soft Fork (Blockchain) - A protocol upgrade where only previously valid transactions are made invalid, with most soft forks requiring miners to upgrade their mining software.
- Solidity - The programming language used by Ethereum for developing smart contracts.
- Stablecoin - A cryptocurrency with extremely low volatility, sometimes used as a means of portfolio diversification. Examples include gold-backed cryptocurrency or fiat-pegged cryptocurrency.
T
- Tangle - The Tangle is a blockchain alternative developed by IOTA, using directed acyclic graphs which only builds in one single direction and in a way that it never repeats, and is quantum-computing.
- Token - A digital unit designed with utility in mind, providing access and use of a larger crypto economic system.
- Transaction (TX) - The act of exchanging cryptocurrencies on a blockchain.
- Trustless - An environment where there is no centralized authority.
- Two-Factor Authentication (2FA) - Two-factor authentication (2FA) is method of access that requires two different forms of authentication.
U
- Unconfirmed - A state in which a transaction has not been appended to the blockchain.
V
- Validator - A participant on a proof-of-stake (PoS) blockchain, involved in validating blocks for rewards.
W
- Wallet - A place where cryptocurrency users can store, send and receive digital assets.
- Wash Trade - A form of market manipulation in which investors create artificial activity in the marketplace by simultaneously selling and buying the same cryptocurrencies.
- Weak Hands - An investor prone to panic selling at the first sign of a price decline.
- Whale - A term used to describe investors who have uncommonly large amounts of crypto, especially those with enough funds to manipulate the market.
- Whitepaper - A document released by a crypto project that gives investors technical information about its concept, and a roadmap for how it plans to grow and succeed.
X
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Y
- Yield Farming - Yield farming involves earning interest by investing crypto in decentralized finance markets.
Z
- Zero Knowledge Proof - Proving certain information or data is true without revealing it.
Hard Money You Can't F*ck With
Bitcoin is hard money you can’t f*ck with. No-one controls it. No governments, no companies, no central banks, no money printing. It’s a revolution as big as the internet. And it’s never been hacked. Entrepreneur and investor Jason A. Williams is the first author to put bitcoin in context of the 2020 crisis - a year of financial disaster and unprecedented money creation (money printer go brrr!) Not only was bitcoin the best-performing asset on the planet in 2020, it quietly established itself as the next global reserve currency as central banks around the world desperately printed their money into oblivion. Hard Money You Can’t F*ck With explains bitcoin in simple, readable terms and maps out how this ‘magic internet money’ will grow into the best form of money we’ve ever had.
The Bitcoin Standard
When a pseudonymous programmer introduced “a new electronic cash system that’s fully peer-to-peer, with no trusted third party” to a small Online mailing list in 2008, very few paid attention. Ten years later, and against all odds, this upstart autonomous decentralized software offers an unstoppable and globally-accessible hard money alternative to modern central banks. The Bitcoin Standard analyzes the historical context to the rise of bitcoin, the economic properties that have allowed it to grow quickly, and its likely economic, political, and social implications.
The Fiat Standard
In The Fiat Standard, world-renowned economist Saifedean Ammous applies his unique analytical lens to the fiat monetary system, explaining it as a feat of engineering and technology just as he did for bitcoin in his global bestseller The Bitcoin Standard. This time, Ammous delves into the world's earlier shift from the gold standard to today's system of government-backed fiat money—outlining the fiat standard's purposes and failures; deriving the wider economic, political, and social implications of its use; and examining how bitcoin will affect it over time.
The Hidden Secrets of Money
A series presented by Mike Maloney as he travels the world to uncover the Hidden Secrets of Money. Learn about gold and silver, central banking, wealth cycles, deficit spending, monetary history, the financial crisis, the fiscal cliff, the debt ceiling and more.
Principals for Dealing with the Changing World Order
Ray Dalio created an animated video inspired from his book, Principles for Dealing with the Changing World Order, hoping that this animation gives people an easy way to understand the key ideas from the book in a simple and entertaining way. In the first 18 minutes, you’ll get the gist of what drives the “Big Cycle” of rise and decline of nations through time and where we now are in that cycle. If you give 20 minutes more to watch the whole thing, it will show you how the big cycle worked across the last 500 years of history—and what the current world leading power, the United States, needs to do to remain strong.
Michael Saylor
$MSTR Founder & CEO | @MIT Aerospace | bio @ http://michael.com | free education @ http://saylor.org | #Bitcoin is http://hope.com & http://strategy.com. | All tweets are my own.
Natalie Brunell
@natbrunell Host of Coin Stories #Bitcoin podcast | Media Commentator | Investor | Educator | Emmy Winning Journalist
Bitcoin Archive
@BTC_Archive #Bitcoin News, Insight & Commentary 🚀🌔
What is Money
"What is Money?" is the rabbit that leads you down the proverbial rabbit hole. It is the most important question for finding truth in the world. In this podcast, Robert Breedlove pursues this "rabbit" by engaging in a diversity of deep conversations with deep thinkers from different walks of life.
What Bitcoin Did
The What Bitcoin Did Podcast is a tri-weekly Bitcoin podcast where host Peter McCormack interviews experts in the world of Bitcoin development, privacy, investment and adoption. Launched in November of 2017, the podcast has grown to over 400 episodes with a guest list that is a testament to the diversity of knowledge and opinions that represent the broader Bitcoin community.
Bankless
The Ultimate Guide to Crypto Finance. DeFi, NFTs, and cryptocurrencies. Level up. Go bankless.
Getting off Zero
What cryptocurrencies should I invest in?
There is no one size fits all answer here. you should determine your risk tolerance and decide how much capital you are willing to invest in "risky" projects.
Bitcoin is the least risky of all cryptocurrencies but still has a high ceiling based on potential future adoption. I recommend people keep at least 50% of their crypto portfolio in Bitcoin and then based on their risk profile, spread the other 50% across other crypto projects.
If an investor wants to be hands off and is looking for a long term investment, going 100% Bitcoin for a crypto portfolio allocation is completely appropriate.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
How do I evaluate crypto projects?
As with any company, you can never know what will take off and what will collapse over time. Some key metrics that should be looked at to determine a projects potential success rate include:
- Does the use case make sense? Read the project's white paper. Are they solving an existing problem or did they create a problem to solve with their project?
- Who are the project founders? Look into the founders and their professional background. Does it feel like the right people are on the team to make the project successful?
- How active are the developers? If the project is open source, find the Git repository and look at the number of commits and active developers updating the source code.
- How did they raise capital? Many projects go about raising funding through different means such as acquiring private venture capital or offering a public token sale. See what the tokenomics are of the project and if you feel comfortable with the funding and distribution.
- Does the project have active partners or an existing user base? Identifying if the project is still in the theoretical phase or if they have a working product will highlight where they are in their product development journey.
- What is the current market cap? This is one that often confuses people because price and market cap tell you 2 different things. A crypto may sell for $1 a token but if there are a trillion tokens in circulation then the crypto has a market cap of 1 trillion dollars. You would then research what is a realistic market cap for the industry this crypto project is going after to determine a potential floor and ceiling. This may highlight a potential ceiling of $100 per token or it may highlight the project is greatly inflated and isn't worth 50 cents a token. Ignore price and study market cap.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
What exchange should I use to buy crypto?
This must be assessed on a crypto by crypto basis. Search for the crypto on a price screener like messari.io and click the markets tab. It will tell you what exchanges sell this specific crypto. Look for exchanges with high liquidity and verify they are available to use in your country. Consider the type of trading you plan on doing (frequent versus infrequent) and if trading fees will be more or less relevant for you.
If an exchange does not require KYC, some people choose to use a VPN in order to access exchanges unavailable to their country.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
How much should I invest in crypto?
This again does not have one right answer. There is one wrong answer and that's zero (Getting off Zero, get it?)
If you are looking to invest for the potential upside, cryptocurrencies are a great option to consider. If you are looking to preserve your wealth against inflation, Bitcoin is for you.
Typically the more you learn about cryptocurrencies (especially bitcoin) the higher your crypto investment portfolio allocation typically gets from my experience.
Most cryptocurrencies are extremely speculative and will likely fade away never to be successful (similar to the dot com boom in the early 2000s). Only invest what you are comfortable losing in case you pick the wrong projects.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
How should I approach crypto investing?
Cryptocurrency prices are extremely volatile and will continue to be as the industry evolves and adoption remains in the early stages of its S curve.
A great way capitalize on price pull backs and limit the amount you buy at the peak is to leverage DCA or dollar cost averaging. Pick the projects you plan to invest in for the long term and determine how much you want to invest in a given month. Setup small recurring buys every week, day or even hour to spread your buys out over time. This will expose you to price drops and limit the amount you buy during price peaks.
For example, Strike offers FREE hourly buys for Bitcoin through the Lightning Network.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Where should I store my crypto?
Most of your crypto should be secured offline using a cold storage wallet. Only keep a small portion of what you plan to spend or trade on an exchange or in a hot wallet.
It is tempting to just setup buys and leave your crypto on an exchange but the rule you need to live by is "Not your Keys, Not your Coin". If anything happens to that exchange, they control the keys to your crypto and not you. Learn how to properly take ownership of your investment and move it off the exchange.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Words of Wisdom
Avoid Guaranteed Returns
If it seems too good to be true, it probably is. If a platform or crypto advertises a guaranteed return, proceed with caution because there is a good chance their model is not sustainable and could possibly be fraudulent.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Always enable 2-Factor Authentication
2-factor adds an extra level of protection that prevents hackers from sending themselves your crypto should they gain access to your hot wallet or exchange account.
It is very easy to get hacked by accident so make sure you have property safety measures in place preventing thieves from stealing from you.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Blue Chips vs Shit Coins
Do not get caught up in investing a large portion of your portfolio in crypto projects that have a low chance of success (shit coins). Most crypto projects will ultimately fail and if you chaise the "potential" for exponential returns, you will likely lose most of your money.
Move your money to established projects like Bitcoin and Ethereum that have a proven track record and more importantly a large active development community.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Stop checking prices
Everyone goes through the period where they refresh their crypto app to check prices 20+ times a day because of the sheer volatility. Overnight increases feel amazing as you see your crypto project shoot up in value and overnight drops make you feel like your watching a car crash. You want to look away, but you can't.
Fight the urge and stay off the market apps. Your mental health will greatly improve by doing so.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Invest what you can afford to lose
Nothing is guaranteed. Before you invest money in anything cryptocurrency related or not, you have to determine what amount you feel comfortable with in the event that things go south and you lose your entire investment.
Simple rule of thumb, do not trade groceries for crypto.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Expect FUD (Fear, Uncertainty and Doubt)
Cryptocurrencies in general are challenging the status quo on many if not all industries. This means that power will be up for grabs and people do not like to lose the power they hold. With any disruptive technology (cars, electricity, internet etc.), there will be push back at every level from those who stand to lose something in the transition.
Learn to identify valid critiques from self-interested FUD as the space continues to evolve.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Do not trade with emotion
It is important to make decisions from a state of logic and reason and not from a state of emotion. trading with emotion will lead to decisions that don't likely align with your personal investment thesis as they were motivated by outside influences.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Plan for FOMO (Fear of Missing out)
Everyone experiences FOMO. Devise a trading and investment strategy ahead of time and stick to it. If a project pops up that appears to be the "next big thing" do not jump in without doing proper due diligence and research first no matter how enticing the opportunity seems.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
Approach crypto with optimistic caution
Do not accept any claim at surface value and conversely, do not dismiss claims without proper thought and research. Cryptocurrencies are a disruptive industry and from it, some innovative ideas will succeed and many will fail. Be open minded but question everything.
👨🏫 Disclaimer - This is only my opinion and should not be taken as financial advice.
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