- A Skeptic’s Dive into Crypto Pt. 1 What is it?
Just now·4 min read
This is the first in a series of bringing ourselves and readers up to speed on crypto. We are by no means experts on the subject and are using this as a way to educate ourselves and share our findings. This material is not financial advice or an offer to purchase or sell any product. Additionally, if you have any insights, findings, or interesting articles please send them to us.
Okay, so we slammed crypto the past few years and, honestly, thought it was going to die a slow painful death. The reasoning was:
1.) it was going to threaten the governments ability to control their monetary policy and thus they would make it illegal (which several countries have); or
2.) it would never gain the mainstream traction it needs from either individuals or companies to make it worthwhile.
I am still incredibly skeptical, more so now that coins are over $50,000. Did we miss the boat? Is there still room for these to grow? Why are the valued at what they are? Can’t we do all of the same things without using crypto?
What is crypto:
A cryptocurrency, or token, is a form of payment for a specific use online. There are over 6,000 tokens and they all serve different purposes. The appeal is that they use cryptography, thus the tokens are nearly impossible to be faked or duplicated, and that it runs on a technology called blockchain which is decentralized. The blockchain is a public verification method of both the amount and users (we can dig into this more later).
Why use it:
There are several things you can do with cryptocurrencies:
- Buy things — As it becomes more mainstream, companies are now willing to accept it as a form of payment. Elon is a different story, but you CAN buy a tesla with it.
Invest — It is the hottest “alternative” investment out there. Coinbase is probably the household name you know, but even PayPal lets you buy and hold the currencies. Buying BTC 5 years ago would have given you a +14,000% return!
Mine it — This is going to need a separate blog, but basically mining is the verification process for transactions. They solve the complex cryptographs to confirm transactions and add those to the blockchain. Not the best place for beginners that do not have the capital necessary to make it worthwhile.
There are probably more things you can do, like making DApps, but this is a pretty easy introduction into what is possible.
So what is an altcoin? Basically it means alternative to Bitcoin, so any coin that isn’t Bitcoin. The one you are most familiar with is probably Ethereum or now the hugely popular (thanks to Musk) Dogecoin. Others are:
You get the gist, there are over 6,000 of them. You may have also heard the term token being used and wondering is that the same thing? If you use the term token, I am sure people will understand what you are saying but it is different.
Tokens are given out at Initial Coin Offerings and can be thought of as a stock, they are used for different functions: Security, Utility, or Value. They are a type of encryption and represent the long identifiers used in transactions. Ethereum and Bitcoin are both tokens.
Its confusing, learn more here. Basically a coin is used like money and a token is used as money, but also enables additional functions for the blockchain applications.
Why get into it now:
If you can’t beat them, join them. I admit I was wrong to think this was just a fad, and now major institutions are incorporating into their platforms. I still don’t think this will “kill fiat” no matter how many times the Winklevosses or Pomplianos tweet that out. I do think it is here to stay for the near to mid term. The pandemic has sped up adoption and although we may have missed out on the ridiculous gains, there is still money to be made.
We also see this as a way to help educate our followers. It isn’t easy to get people to learn something new or accept something new that doesn’t align with their worldview, but at least we can have them dip their toe in the water.
One way we are doing that is with the People’s Crypto Portfolio. Click here to learn more about that.
You can find the public view here: cryptocompare
If you would like to invest or check it out, you can support us by using this referral link for a Coinbase account. If you Sign up and buy/sell $100 worth of digital currency we both get $10 of BTC.
PLEASE DO YOUR OWN RESEARCH FIRST BEFORE YOU SIGN UP.
Additional educational materials:
Most crypto sites have educational posts now, but otherwise some places to start:
As we find better sources we will continue to share them with you in our posts. If you have any great sources that you think are worthwhile to check out, please send them our way.
If you would like to stay up to date with our posts and the People’s Crypto Portfolio, please consider subscribing to our newsletter!
- Date of publication:
- Tue, 05/04/2021 - 20:19
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