The Crypto Guide
The Crypto Guide
This website is designed to be very simple and easy to navigate. This guide is an easy-to-understand introduction to the cryptocurrency world. It covers different cryptocurrency projects and the underlying technology.
Blockchain technology will revolutionize everything from finance, insurance, logistics, supply chain, digital identity and the stock market to ownership and many more industries. Banks, governments and research institutions have started to develop base on Blockchain technology. Blockchain technology is behind almost every cryptocurrency project. Cryptocurrencies are used on Blockchains to make transactions that serve different purposes.
Blockchain starts with a Genesis block contain data from transactions on the network, all the following blocks contain hash of the previous block, blocks are connected one after another to form a chain, thus Blockchain. The data contained within a block can not be changed unless the data in all the previous blocks are changed as well. In the example of Bitcoin Blockchain, millions of computers around the world all have a copy of the Bitcoin Blockchain data and constantly compete with each other to solve complex algorithms to record transactions and produce blocks and in turn gets Bitcoin as a reward, this process is called mining. Because Bitcoin network data exist on all the Bitcoin nodes around the world, it is almost impossible to hack the network unless a 51% attack occurs. Thus Bitcoin is a decentralized network however China controls the most hash power of the Bitcoin network right now.
Bitcoin is very unique and Bitcoin code was released at the perfect time, right after the 2018 Financial Crisis when people have lost all trust in the banking system. Bitcoin was created as a peer-to-peer electronic cash network. Bitcoin is permission-less, there is no third party involved in a Bitcoin transaction such as a bank. Bitcoin is censorship resistant, no government controls Bitcoin. Bitcoin has both Network Effect and Lindy Effect working for it.
Network Effect: In economics, a network effect is the phenomenon by which the value or utility a user derives from a good or service depends on the number of users of compatible products. Network effects are typically positive, resulting in a given user deriving more value from a product as other users join the same network.
The Lindy effect is a theory that the future life expectancy of some non-perishable things like a technology or an idea is proportional to their current age, so that every additional period of survival implies a longer remaining life expectancy.
When a network effect is present, the value of a product or service increases according to the number of others using it. Bitcoin addresses are increasing at a rapid rate every day, Bitcoin transactions are increasing every day and hash power is at all time high.
Bitcoin soared from $1000 to $20,000 in 2017, outperforming every other asset class including stocks, gold, real estate and etc. Bitcoin outperformed every other asset class in history since its inception. From less than $0.01 beginning in 2009 to $20,000 at the end of 2017. And that has captured the attention of the public. Many people gotten interested in Bitcoin and cryptocurrencies.
Real time trading prices for all cryptocurrencies can be found on https://coinmarketcap.com.
What Are Cryptocurrencies?
Cryptocurrency is a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. Some cryptocurrencies are assets, some are platforms and some are businesses.
Why are they valuable?
There will be only 21 million Bitcoins for a world of 7.5 Billion people. On average one person can only own a tiny fraction of Bitcoin = 0.003 Bitcoin / person in the world. So Bitcoin is in high demand. Bitcoin is thought of as "Digital Gold" by many people because it has many properties of gold such as limited supply and acts as a store of value. It has limited supply of 21 million Bitcoins. It is a hard cap written in the Bitcoin code and no more Bitcoin can be created once it reaches 21 million. Limited supply and low inflation means Bitcoin is in high demand. Bitcoin can be spent a lot more easily than gold, Bitcoin can be used to make purchases at tens of thousands places around the world and everyday businesses around the world are opening up to the idea of accepting Bitcoin as a payment. Unlike gold It is much easier to divide 1 Bitcoin down to 0.00000001 BTC or 1 satoshi and much easier to transport Bitcoin.
Many cryptos try to differentiate themselves to address specific problems, they share a common set of characteristics: security, transparency, immutability, global accessibility, speed and price.
Security: Bitcoin is secured by the network of computers around the world that are constantly confirming transactions on the Bitcoin blockchain. It is almost impossible to tamper with Bitcoin. Once a transaction is confirmed it stays on the Bitcoin blockchain forever unlike many traditional assets that can be tampered with. Cryptos are decentralised. Records don’t exist in one location but in hundreds or thousands of servers around the world. In the case of Bitcoin, the network can only be compromised if 51% of the computing power of the servers is directing a malicious coordinated attack. Which is almost impossible unlike traditional digital records that are stored in one central location.
Transparency: Almost every cryptocurrency is open source, its source code is available for everyone to see. It is completely transparent. With the use of “explorers” it is possible for anyone to see every transaction that has ever been executed since the crypto's creation.
Immutability: It is immutable because no one can change the transaction history. These records can never be changed except when an ecosystem complete collapses.
Global accessibility: Anyone from anywhere can send and receive cryptos it is border-less. No sovereign government controls the cryptos.
Speed: Bank transfers typically take 3-5 business days and come with high fees with poor exchange rates between currencies. Cryptos solve this with transaction times ranging from a few seconds to 1 hour depending on the crypto being used.
Price: There is no exchange fee because it doesn't need to be exchanged and it only comes with a transaction fee. Some transactions in cryptos are free such on the EOS blockchain. Real time trading prices for all cryptocurrencies can be found on https://coinmarketcap.com.
Fact #1: Bitcoin is cryptographic money
Fact #2: Bitcoin is permission less and censorship resistant
Fact #3: Bitcoin transactions are forever
Fact #4: Bitcoin is (practically) unconfiscatable
Fact #5: Bitcoin is a decentralized, digital monetary system
We do not offer any financial advice. We recommend that you consult with your financial advisor for all your financial decisions. We are not responsible for any of your possible loss. Cryptocurrency is a very speculative asset. Please do your own research and due diligence. The information provided may not be 100% accurate or up to date as cryptocurrency space is changing by the second.