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A Quick Beginner’s Guide to Cryptocurrency

Cryptocurrency is beginning to find its way into mainstream consciousness, as its epic rise from the dark web into the light of day has taken Bitcoin up in value over $5,270.oo in the last year alone.

The crypto-rush shows no slowing down, and there is a lot to be learned about the implications of how this new medium of money can transform the consciousness of currency, liberate us from our current oppressive debt-based financial system (see: Hidden Mechanics of the Central Banking System), and allow new regenerative systems to evolve in its wake.

We briefly chatted with Steve Dakh, co-founder of KryptoKit, to get some basics on the history, future, and present ways to work with cryptocurrency.

A Quick Beginner’s Guide to Cryptocurrency

What is Cryptocurrency?

In 2008 an anonymous entity by the name of Satoshi Nakamoto came out with the whitepaper for Bitcoin describing how a decentralized money system could work. There had been many failed attempts in the past to create a digital currency, as the governments would come and shut them down.
This was because there was no proper mechanism that had been developed that would allow for a completely decentralized digital currency…until the whitepaper came out. In 2009, Satoshi wrote the code for the first ever Bitcoin client software. Slowly but surely people started downloading his client and mining Bitcoins which were essentially worthless at the time. It wasnt until 2010 that a market was established for users to trade fiat currencies with Bitcoin. In 2011 Bitcoin began to hit mainstream popularity.
In 2013 news of bad economic situations in Greece and new interest from China fueled the rise of one Bitcoin to $1,200. In January 2015 Vitalik Buterin annouced his Ethereum project which had a similar underlying system as Bitcoin, but with the added benefit of a programming language so anyone could build any kind of decentralized system to their specifications without having to make their own blockchains. Ethereum’s smart contracts open up a whole new world for building things such as voting systems, identity, decentralized asset exchanges, and much more.

How does it differ from our current financial system?

Our current financial systems depend on Fiat currencies which mean they are backed only by the government which issues them. This has inherent flaws such as the ability for the central bank to print as much currency as they want in turn inflating the supply of currency which of course devalues our money. With cryptocurrencies, the supply is not controlled by any entity, but programmed into the code itself. Everyone knows exactly what the supply is and what it will be in the future.

What’s the different between BTC and Ethereum?

Bitcoin is essentially a decentralized ledger of balances. Ethereum has that plus the ability for users to write code and build software directly on the Ethereum blockchain.

How will it change the world?

Around 40% of the adult world population has no bank account. Yet the majority of the world population has some access to internet. Cryptocurrencies allow users to store money and send it anywhere in the world without a third party necessary. This will allow those 40% to have access to the global economy. Also, there are are even more people who lack proper identification documents around the world. With identity projects built on Ethereum, these people will be able to build their own reputations on a decentralized platform that can not be cheated or taken away.

Advice for beginners

There are many cryptocurrency exchanges out there, but some of more popular ones include:

ย How to Use

Bitcoin wallets:
Ethereum wallets:
  • Jaxx
  • Smartwallet (Coming soon)

How to store it

It is best practice to not keep your coins on an exchange as this removes the entire benefit of having a decentralized currency in the first place. Use a wallet. For large values, purchase a hardware wallet such as the Trezor or the Ledger Nano S for the best security.

Projections for the future/parting words.

I project prices to continue rising for many years. The total value of all cryptocurrencies is approaching $100 billion. That’s nothing. The US alone moves $14 Trillion per day through its financial system. The prices will have to catch up to the demand.
Decentralized Blockchains are a disruptive technology. The utility they provide is unlike anything else. It gives the power of financial freedom back to the individuals where it belongs. No more middle men.

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