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What else is there to do during a pandemic, but learn Web design, and of course get into Crypto.
A warning though, crypto is highly addictive.
I’m mostly interested in how I can adapt this into my business, my everyday life and the potential to help humanity in a whole. I believe that crypto has great potential, and we in Australia are just at the precipice of something huge, but first let’s get our minds around the concepts.
What is it all about?
It takes a while to get your head around the actual purpose and workings of Crypto. I tell my friends in Melbourne, “hey, I’m into crypto”, and you either get a laugh or, an empty look.
This tells me that, the Zeitgeist in Australia has not yet incorporated the belief, trust and possibilities of Crypto, but it’s changing slowly and getting into the game now is a smart move.
A smart move as there are soo many projects created alongside with crypto that are truely inspirational and life changing.
I’m relatively new to the game, so I’m going to research and explain in my basic way, what I believe crypto to be and find out how it’s going to serve us and the rest of humanity in the future.
Also a disclaimer: I’m not by any means of the imagination a financial adviser.
Current System:
We (the world) currently use the FIAT monetary system which is paper money. Printed by a governments and is mandated as legal tender by that government. So basically, the government gives the security (full faith), that this currency is good for that country.
Fiat Currency is a “Storage medium” for purchasing power and replaces the barter system which was the predecessor to FIAT.
Once the Government creates its paper money, the Markets and Central Banks get involved. They value the paper by:
- Level of Governance by, the Government
- The Economy
- Interest Rates (effected by the last two points combined)
*great full detailed explanation about money on the RBA site –> here.
Basically, the bank ranks and allocates the currency a form of trust, by how well the country of that Currency is run.
Crypto Currency:
This can be a bit tricky to explain to your friends or family, nobody quite understands or trust Crypto (yet). You can hear it in the uncomfortable silences when you’re explaining the blockchain.
I’ll try and explain it here, and at the same time research and learn more myself which honestly was the point of this post.
Very exciting times coming up for crypto and if you get involved i guarantee that you will get, slightly obsessed.
Bitcoin (BTC)
Bitcoin is the very first crypto coin to be created. The original coin, created by Satoshi Nakamoto. This is most likely a fake name created by the actual group of Bitcoin developers.
The first intent in creating the Bitcoin system, was to remove third party involvement in all monetary transactions between friends, family, businesses or anyone across the planet. As soon as you involve the banks in your transactions this brings high Fees and sometimes in the worst situations within a crumbling economy the bank seizing your funds or not having them.
Satoshi wanted to create an alternate financial system eliminating a trusted third party (banks) and create a trusted Network technology.
The idea was to create a decentralised banking system with all transactions and “trust” is handled by the network. This network would be a peer to peer network implementing the blockchain technology.
The blockchain technology, uses aspects of Cryptography to make sure the ledgers (transaction records) cannot be copied or forged. Copies of the blockchain are distributed throughout the Blockchain network and can verify all transactions as part of a group consensus, and fix or reset any anomalous transactions.
(for an in depth explanation of the blockchain go —> Blockchainhub)
Miners
You might have heard of Crypto miners, they are the “auditors of the blockchain”, verifying transactions and making sure there are no double spends using the Cryptographic principles of “Proof of work” (PoW).
Miners use powerful computers to solve mathematical equations to compete for the block rewards. All transactions are handled by miners and added to the chain. For their trouble miners receive a reward in a small amount of Bitcoin. This is also available for some other (alt) coins (Ethereum, Raven Coin, etc.)
Mining on your own would be pointless, the best system is to join a mining pool. This pool combines the power of many computers, this gives you a better chance of getting rewards even though it’s just small cut.
Bitcoin rewards for Mining, are halved every four years, this coincides with the limit of 21 million coins available. After every halving the price of bitcoin rises, this gives incentive to miners to keep mining even though their rewards are halved.
SO WHAT GIVES BITCOIN HAVE VALUE?
Bitcoin has value because it is money, and a payment system rolled into one. More so a payment system with a value added to it. The uniqueness is the combination of both. Most currency is separated into both for example legal tender and a bank or institution.
For example, you can pay for chips at Maccas with cash, but as soon as you move away geographically a payment system is needed. E.g. Visa or Mastercard. Our current system you could say is split into two.
Bitcoin offers this unique feature, and has the many traders that have “trust” in the technology.
Demand and supply, that what keeps bitcoin bullish. When more people want to purchase bitcoin it goes up, when people start to get nervous and start selling off bitcoin it drops. That simple.
The next important factor correlates to finite amount of Bitcoin, 21 million will ever be created. This makes Bitcoin scarce and rare. Unlike the FIAT currency nobody can print more Bitcoin and drag the price down, it is set and that all you have.
“Now let’s remember the poor souls that lost their Bitcoin Wallets or just can’t remember there passphrases”
ALT COINS
Every coin other than Bitcoin is called an alt-coin and technically they also can be called Tokens. Alt coins all have a vast array of functions. Some alts have a much faster transaction rate compared to Bitcoin which is 1 transaction every 10 minutes, and also much lower fees called Gas Fees.
In Alts, we have:
Stable Coins:
Stable Coins are coins that are “Pegged” (tied to) cryptocurrency (bitcoin), Fiat Currency (USD, Euro), or precious metals (gold). This gives the coin stability, therefore the name Stable Coin.
Examples of Stable Coin are:
- Tether (USDT)
- True USD (TUSD)
- USD Coin (USDC)
- Binance (BUSD)
Mining based Coins:
As well as trading as a currency, alt coins can be mined. Miners get paid a part of the transaction fee for adding the mined coins transactions ledger into the blockchain. This is called proof of Work (POW). The payment can be several coins or minute parts of a coin (BTC) depending on the complexity of the transaction and also the fact that you are mining as part of a pool of many miners and all the rewards are shared out.
Miners compete by solving a mathematical computation, whoever solves it first, gets to place the next block. The amount of return depends on the transaction amount on the block that they get to place. Mining has taken off during the 2020-21 lockdowns.
Examples of Mining Coins:
- Etherium (ETH)
- RavenCoin (RVN)
- Monero (XMR)
- Litecoin (LTC)
- Vertcoin (VTC)
NFT (Non-Fungible Tokens)
These are all the rage at the moment. Tokens work on top of the blockchain for example on the Ethereum blockchain, but can also work on other blockchains. They hold extra data (data of ownership) on the blockchain which makes each token completely unique. Each token might have information of ownership for all sorts of assets. These can be artwork (digital or real), music, real estate, collectables, even the first Twitter tweet has been sold as an NFT. Fungible tokens are all the same and serve only to trade.
Example of NFT’s
- DECENTRALAND (MANA)
- WAX (WAXP)
- THETA (THETA)
- ENJIN COIN (ENJ)
- AUDIOUS (AUDIO)
DeFi tokens
Decentralised Finance, these tokens try to replicate traditional finance systems for example Lending, insurance, savings and trading.
These tokens are mostly on the Ethereum block chain and implement smart contracts which is slowly becoming a game changer in Finance.
Example of DeFi Tokens:
- 1inch (1Inch)
- Uniswap (UNI)
- Chainlink (LINK)
- Yearn Finance (YFI)
- Sushi Swap (SUSHI)
Purchasing Crypto Currency:
Exchanges
If you are wanting to try your hand at crypto, you might want to begin with an exchange. This involves joining an exchange and depositing money from your bank (FIAT).
Joining an exchange, is a good start into crypto. There are many exchanges in Australia, and they all have different features, coins and level of service. (check out some Aussie Exchange’s listed below).
Some exchanges offer a demo mode, some offer tutorials, most use trading view graphs. Personally i find that the Aussie exchanges are easier to understand and get your head around as a beginner.
The advantage of using an exchange is that you can easily transfer from one coin to another, and you can keep an eye on all your coins in one place with one login.
Before we go ahead just an explanation:
Each block in the blockchain, alongside traders transactions information, has a Public and Private key assigned (a part of Cryptography). The private key is only known to you, and to access your crypto you must input this key. Now each coin has a corresponding wallet, for example Daedalus wallet is for Cardano (ADA).
When you choose to trade with Crypto over an exchange, you dont have these passphrases (private keys) as the exchange deals with all those and you only have the exchanges wallet. So technically you dont own the coins. So just keep this in mind when dealing with large amounts of Currency. Always do your research and use accredited exchanges.
There are many coins and many wallets, and keeping a lot of wallets can be very complex. Private keys are a long hexadecimal code (usually a long list of phrases) which matches a public key. If you lose this key you are literally screwed.
Wallets:
Cryptocurrency wallets are pieces of software that hold your crypto. Most coins have a preferred wallet. Example ADA (Cardano) has the Daedalus wallet. Exchanges use multi wallets for each coin they offer to trade.
There are two types of wallets, hot wallets and cold wallets.
Hot Wallets are wallets that are connected to the internet and Cold wallets are ones that are not for example hardware wallets. These hardware wallets can be used in conjunction with Hot wallets and then be stored in a safe location.
Hardware Wallet
Here’s a short list of my favourite Australian Exchanges:
Melbourne Based exchange offering 250 cryptocurrencies. Fees from .01% to 1%. Android and IOS apps available
Exchange based in Brisbane, free to join and even offers a Demo mode. Great looking interface and offers many coins and IOS and Android apps. Easy verification of IDs and you can use the Google authenticator (make sure you back up your recovery password). It also has news and updates on crypto, which is nice. Low fees from 0.6% and no withdrawal or deposit fees
Australian Exchange offering Coinjar debit card and low fees. Android and IOS apps available
Binance is a cryptocurrency exchange that provides a platform for trading various cryptocurrencies. As of January 2018, Binance was the largest cryptocurrency exchange in the world in terms of trading volume. Although it is an Internation Company Binance does have offices in Australia.
Conclusion:
In conclusion I have enjoyed my dabble in crypto, I have made some nice gains from very modest investments. We are currently (2021) in a Bull run (rising prices and optimism) so there are some nice gains to be made if you do your research.
I’m not looking forward to the bare market (low prices and fear), but what goes up must come down eventually.
I have been thinking a lot about Crypto and how it will affect the normal person apart from Trading. By normal i mean the average punter, the worker with kids, maybe a small business owner, a young couple, Singles or Married Couples. How does Crypto change their life?
I think this is a good question, and I believe that crypto alongside the old FIAT systems can co-exist for now. I just can’t see our large institutions giving up hundreds of years of power and manipulation for a Future currency that is completely decentralised.
So for now maybe we can just start with purchasing goods and services with crypto using a stable coin or Bitcoin. We can all get our Teslas with Bitcoin now.
As I’m writing this post entry PayPal has announced millions of traders will be excepting Cryptocurrency on their PayPal system. For now, it’s only available in the U.S, but hopefully this will be introduced in Australia later in the year. The currencies you can use to pay are Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. This is a huge boost for the credentials of Cryptocurrency, big business is taking notice.
There is a blockchain technology that is looking into helping countries with economies that have already crumbled, where corruption is rampant and the people have been robbed by inept governance. Cardano is putting proposals into Africa, to create better Supply chains, better solutions for business, and land dead ownerships systems, all using the blockchain. More info about Cardano here at emurgo.io.
There are many countries at the moment where economies are so deteriorated that their FIAT is worthless. There is the example of Venezuela which due to corruption they are experiencing Hyperinflation and their money is worthless. Venezuela is one of the highest adopters of Crypto in the world alongside Zimbabwe.
So maybe Crypto is the Solution for damaged economies, away to give disenfranchised people to take advantage of a decentralized, independent, fast, transparent, secure, and cheaper monetary alternative.
I think that making a decision of what you want to get out of crypto, is it just about money or is it to support an ideal, the very ideal of what Crypto was originally intended for. I get swept up sometimes on the stories of huge gains and Lambos, but this is more than Lambos, I believe its about creating a better financial system than what we have inherited which only helps the elite.
It’s a great time to be alive and history will be the Judge, I wish all a decentralised life.
Use Crypto today
At the moment there are a few businesses that are excepting Bitcoin right here in Melbourne.
- HeroSubs
- Grumpy’s Green
- Bike Factory Outlet
- Fernwood Gym Bulleen
- Mr Pilgrim (chadstone)
- Fastway Aquarium & Hydroponics
…and many more. Full list here from cryptomarkets.com.au
Implementation is slowly happening im Australia, give these brave business owners your support.
Crypto Cards
What stands out the most for me and I’m currently looking into, are the Crypto Visa cards.
A few companies offering Crypto Cards in Australia are:
Offer Crypto cards, that work just like Visa Cards. If you stake your Crypto.com (CRO) coins you get a heap of rewards.
If you stake more CRO coin on the Crytpo.com wallet you are eligible for a card with more features.
The cards look pretty sleek to Check them out:
Will be offering a Crypto card Soon
With the Binance Visa Card, you can convert and spend your favourite cryptocurrencies at more than 60 million merchants worldwide. Just transfer crypto from your spot wallet to your card wallet, and you’re ready to go. Spend your crypto anytime, anywhere.
