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Learn what cryptocurrency is and get the information you need to decide whether investing in it is right for you, with the help of this guide to cryptocurrency.
There’s more than one way to look at just about everything, especially when it comes to your investments
In times of recession, or even a pandemic, you may feel financially “stuck,” or think that you can’t build wealth until the crisis passes.
The truth is, every financial crisis comes with opportunity.
When the economy is stressed, there are often more opportunities to invest at a discount, meaning, you can buy potential investments for a low price and build wealth faster than normal times.
With this guide to cryptocurrency, we provide information on everything you need to know about one of the most accessible investments you can make. Learn exactly what cryptocurrency is and how people use it as an investment tool to earn passive income.
In this beginners’ guide to cryptocurrencies, you’ll find out how and where crypto can be used as currency, and how to find cafes, stores, and online stores.
You’ll also discover resources to help you learn more about cryptocurrencies, such as online classes, courses, and communities to help you invest wisely
Here’s what we cover in this guide to cryptocurrency:
- Understanding Cryptocurrency (Including Bitcoin)
- Cryptocurrency As An Investment Tool
- Where You Can Use Cryptocurrency
- How To Get Started Investing In Cryptocurrency
- Cryptocurrency Classes, Courses, And Communities
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Understanding Cryptocurrency (Including Bitcoin)
As a beginner’s guide to cryptocurrency, we start by answering the most obvious question in a nutshell: “What is cryptocurrency?” and then go on to elaborate its other aspects such as where it’s used, what are its advantages, whether or not it’s a safe investment, and so on.
What is Cryptocurrency?
Cryptocurrency is a decentralized global digital currency that has been around since 2009. It doesn’t have a bill or coin or any other physical equivalent; like we said, it is digital, meaning it’s completely virtual or online. It can be used to pay for goods and services in a quick manner, but only by those businesses who accept cryptocurrency of course. In addition, many companies have issued their own virtual currencies, also referred to as tokens, with which you can buy their products or services. Perhaps its most beneficial attribute for users is that it can be transferred online from one individual to another without requiring an intermediary financial institution like a bank.
Bitcoin, released in 2009, was the first cryptocurrency.
Today there are more than 5,000 types of cryptocurrencies across 20,000 different markets.
Cryptocurrency is both a currency and an investment.
You can use it to make purchases online (from businesses that accept crypto), trade from person to person, or buy and sell as demand rises and falls.
What does “decentralized global digital currency” mean?
The concept of cryptocurrency often intimidates people who haven’t followed its history, but its four traits are simple to understand.
1. Cryptocurrency is decentralized.
Unlike most currencies that link to a centralized location, cryptocurrency operates independently of banks, the government, and the Federal Reserve.
The peer-to-peer style (P2P) exchange of cryptocurrency allows investors to interact with each other directly instead of going through a centralized exchange.
This autonomy is one of its most attractive qualities because it allows the alternate currencies to hold their value, even if the dollar plummets.
In this way, it’s a sort of digital “gold,” that’s not owned or controlled by the government, that could remain valuable through a recession or even depression.
2. Cryptocurrency is global.
Cryptocurrency operates the same way worldwide, so there’s no need to exchange dollars for Euros, Rupees, or any other local currency when you travel.
3. Cryptocurrency is digital.
Unlike paper money, cryptocurrency exists only online. You can’t hold it in your hand or stuff it in a birthday card.
When Bitcoin was released in 2009, the idea of a full-scale digital currency — of not having paper money or metal coins to hold in your hand — was a hard concept to grasp.
Today, though, nearly all our transactions occur online, and people are much less apprehensive about the electronic funds.
4. Cryptocurrency is currency.
Cryptocurrency can be used to purchase products and services globally, but only from businesses that accept it.
The alternative currency is still a bit ahead of its time. Still, a recent HSB-Munichre study conducted by Zogby Analytics found that more than one-third of small and medium-sized businesses in the U.S. accept cryptocurrency.
Cryptocurrency as an Investment Tool
In 2010, a developer made one of the first tangible purchases with Bitcoin — a pizza — for 10,000 Bitcoins.
Cryptocurrency’s value goes up and down depending on its demand, and many early investors became wealthy from buying and selling Bitcoin.
Today, cryptocurrency is still an investment strategy for people looking to cash in on its potential.
Many experts believe cryptocurrency is a safer way to invest than traditional methods such as the stock market. Others think it could fail during an economic disaster.
There are many different guides to cryptocurrency trading that recommend several ways to invest in and profit from cryptocurrency. And while this should not be treated as a beginners’ guide to cryptocurrency trading in any way, here we discuss the two most-common (that anyone can do) ways to invest in cryptocurrency:
- Buy low, sell high: The most common way to invest is to purchase coins whose value you think will rise, then sell them when (and if) the value increases. The price of cryptocurrency, very much like stocks, is what people are willing to pay for it, which means it goes up in times of high demand and drops down when demand is low.
- Dividends: Some coins, such as COSS, CEFF, NEO, and KUCOIN, payout dividends to people that own them (no, you don’t have to buy stocks to get these kinds of dividends).
Some people treat cryptocurrency as a “get rich quick scheme,” but Minority Mindset thinkers know better.
If you can make money from an investment, you can also lose, and any “get rich quick” scheme is usually an invitation to go broke.
Before you decide to invest in cryptocurrency for long-term wealth, it’s necessary to go beyond basic guides to cryptocurrency and extend your research further to thoroughly understand your personal potential and learn how to balance the risks.
Don’t fall into the emotions surrounding cryptocurrency — people’s opinions on the topic are often passionate. To invest wisely, you should set aside the excitement and instead approach it as a logical financial decision.
What Is Bitcoin?
.As a beginner’s guide to cryptocurrency, the first step is to understand Bitcoin – the first-ever cryptocurrency created. Bitcoin is the original, first type of cryptocurrency (the “OG” of crypto), created in 2009 by an unknown person using the pseudonym “Satoshi Nakamoto.”
Nobody owns Bitcoin. In this way, it’s like the technology behind email.
Bitcoin is controlled by the people who use it.
What Is Blockchain?
In a traditional bank, all your transactions get recorded on the bank’s ledger. Bitcoin also uses a ledger – a decentralized, digital ledger called “Blockchain.” Since it’s a decentralized ledger, it is spread across several computers that perform, record, and manage the transactions. In essence, it can be thought of as mainly an online ledger that uses strong cryptography technology to ensure the security of transactions – a key feature given that all transactions are online and the looming possibility of cyber threats today.
In this guide to cryptocurrency, we’ve included definitions of bitcoin, wallets, portfolios, and blockchain – all the most basic terms you need to know to understand cryptocurrency.
Before you begin using any alternate currency, take the time to research and understand what you’re getting into before you spend money.
We recommend using Coinbase to begin using cryptocurrency because it makes getting started super-easy and fun.
Use this link to sign up on Coinbase and get a $10 credit after spending your first $100.
What Is A Cryptocurrency Wallet?
To use cryptocurrency, you’ll need a wallet to store your assets.
A cryptocurrency wallet is a software program (app) where you store, send, and receive digital currency.
The cryptocurrency wallet stores your “keys,” which are like pins and passwords for digital currency. It interacts with Blockchain to let you send and receive digital currency and review your balances.
Depending on which currency or exchange service you use, you might have several wallets that you manage yourself and others that allow you to manage several currencies.
For example, Coinbase is a secure and regulated service where people can buy, sell, and manage cryptocurrencies. Its Wallet app (available for iOS and Android) provides an easy way to start using crypto with U.S. dollars.
What Is A Cryptocurrency Portfolio?
There are thousands of cryptocurrencies to choose from, including popular cryptos such as Bitcoin, Ethereum, Litecoin, BAT, and Dogecoin.
A cryptocurrency portfolio is a program that allows you to track your cryptos while segregating your trading strategies or managing multiple client accounts.
Portfolios, like wallets, look different on each platform or app. When you’re ready to start using digital currency, look for a user-friendly platform that you find easy to understand and navigate.
Where You Can Use Cryptocurrency
To use cryptocurrency for purchases, you’ll need to find businesses that accept it. The list of companies that accept cryptocurrency grows each year, and in 2020, about one-third of small-to-medium-sized businesses are on that list — plus several corporations.
Some national and international businesses that accept Bitcoin, as of June 2020, include:
Are you looking for a specific product? You can use Spendabit to find a list of Bitcoin-friendly retailers that sell the product you want to buy.
You can look up crypto-friendly businesses by visiting Coinmap to browse Bitcoin-friendly cafes, restaurants, ATMs, and more worldwide.
Bitcoin search engine Bitcoinwide provides a Google-type experience to help you find businesses that accept the currency.
Just type your request into the search bar to get a list of participating companies and more details about any of the businesses listed.
As a beginner’s guide to cryptocurrency, it would be worthwhile to mention some other crucial points about the most well known cryptocurrency here – Bitcoin.
Bitcoin isn’t the only cryptocurrency accepted by retailers, but it is the most popular, making it easier to use when traveling. Because bitcoin transactions are a peer-to-peer exchange (outside of government control), some countries have made it illegal to use as currency.
Countries where Bitcoin is banned, according to a report by Cryptonews, include:
- The Republic of Macedonia
- Saudi Arabia
Cryptocurrency is relatively new to the world.
Over time, it’s likely to gain popularity and become more widely accepted.
In the meantime, there are plenty of maps and search engines to help you find places where you can use alternate currencies.
What You Need to Know About Paying with Cryptocurrency
Cryptocurrency is no doubt becoming a popular form of investment as well as payment method. However, in this guide to cryptocurrency, we’d like to point a few vital points worth knowing about paying with this alternative currency.
First and foremost, while many businesses are now accepting cryptocurrency as a form of payment, it doesn’t offer the same legal protection that is inherent in conventional currencies or methods of payment like debit and credit cards. In the event of a dispute or wrongdoing, debit and credit card companies or banks offer consumers legal protection against fraud so they can get their money back.
However, cryptocurrency beginners need to keep in mind that, when paying with this alternative currency, the onus falls on them to conduct due research about the seller and their authenticity.
Secondly most cryptocurrency transactions cannot be reversed, so they’re final. The only way to get back your cryptocurrency in case anything goes wrong is if the seller “sends back” the amount. The absence of a regulatory institution like banks is a double-edge sword. Although it helps save on bank fees and even time, it also poses a risk.
How to Get Started Investing In Cryptocurrencies
You can invest in cryptocurrencies by signing up with any exchange that allows you to purchase them with a debit card, credit card, or bank transfer.
Because U.S. exchanges must be regulated, you will need to verify your ID to trade and invest. For most sites, this is a quick and straightforward process that involves uploading an image of your ID card.
We recommend using the Coinbase platform, especially if you’re a beginner to cryptocurrency.
Coinbase is a U.S. based, secure platform that people use to buy, sell, store, and manage all types of cryptocurrency, and it complies with all applicable laws and regulations. Most of all, we like it because it makes cryptocurrency fun and super-easy for beginners to get started.
For example, if you want to start with something simple, like Bitcoin, just head over to Coinbase.com and follow these steps:
1. Create A Free Account
Go to Coinbase.com and click the “Get Started” button.
Now, enter your email address.
Then fill out your personal information.
2. Verify your email
Now, it’s time to verify your email. The page will pause so you can check your inbox for the verification email.
If you don’t see the verification email right away, try searching for the email address [email protected], or give it a couple of minutes. Then, click the verification button in your email, which takes you back to Coinbase.
3. Verify your Identity
Finally, you’ll verify your identity by uploading your ID.
Once you’re verified, you’ll enter your payment method (credit card or bank account), then you’re ready to get started!
You can get started trading cryptocurrency on Coinbase with as little as $25, and if you use this link, you’ll get a $10 credit after spending your first $100!
We recommend taking some time to get to know the platform and watching some of the fantastic training videos provided by Coinbase before you get started.
Cryptocurrency Classes, Courses, and Communities
Learning about cryptocurrency is a little like learning about the stock market. It’s easy to get started with the help of this basic guide to cryptocurrency, but as you get more involved, you find yourself more curious and wanting to know how you can make better investments.
The following resources will help you learn more about investing.
The Complete Cryptocurrency & Bitcoin Trading Course 2020 on Udemy
This bestseller course on Udemy can be thought of as the ultimate beginners’ guide to cryptocurrency trading. It teaches how you can earn passive income trading Bitcoin and other cryptocurrencies using technical analysis.
In this course, you’ll learn to understand trading and investing from the ground up.
- Learn trading strategies
- Learn how to protect yourself from getting hacked
- Learn to start trading with $100 and make a profit
- And much, much more
TIP: Never buy Udemy courses at full price, because when they go on sale, you can usually purchase a course for under $20 instead of $100 or more. If you don’t see the course at the sale price, check back the next day.
Reddit Discussion Threads
You can browse the latest news and conversation about cryptocurrencies on Reddit.
If you’re new to cryptocurrency, the Reddit threads may seem a bit advanced, but you’ll pick up on things quickly once you start trading.
Threads such as Cryptocurrency News & Discussion and r/CryptoMarkets include everything from tips to news to cartoons and even a few conspiracy theories. Mostly, the Reddit threads connect to a community of people that make investing a bit more fun!
Quora Questions and Answers
Quora can be an excellent place to ask questions and get well-thought answers, as long as you remember that anyone can answer you.
On Quora, you can ask anything at all, and sometimes you get expert answers from world leaders (such as Barack Obama), while other times you might get amateurs trying to pass themselves off as pros (less often than you might think, though).
Just remember the golden rule of finance learning: Don’t believe it’s true just because some random person on the internet says so!
Coursera University Classes
If you prefer an academic approach to learning, you’ll want to check out Coursera. The online learning platform offers more than fifty courses on cryptocurrency.
Since college courses tend to move quickly and share a lot of information, you might want to spend a day or two with the previously-mentioned resources before jumping into a college-level course.
Cryptocurrency isn’t only a decentralized global digital currency that allows you to invest and potentially earn passive income.
It’s also a community of like-minded people who think a bit “outside the box.” Crypto can also be a lot of fun if you take advantage of the learning tools, threads, and forums where people gather.
Get Paid To Learn About Crypto
You can earn up to $121 in cryptocurrencies by watching Coinbase tutorials and learning about different currency types. And, if you use this Minority Mindset link, you’ll also earn a $10 credit after investing your first $100.
Cryptocurrency For Goods, Services, and Investing
We hope our guide to cryptocurrency helped uncover the facts you’ve always wanted to know about the alternative currency. We’d further like to conclude by noting that cryptocurrency provides several benefits that cash doesn’t offer, since it’s a decentralized global digital currency.
To get started using cryptocurrencies, use a platform with easy-to-access training that’s simple to understand. Courses, classes, and communities can help you reach expert-level quicker and also enjoy the process of connecting with like-minded people.
To decide whether cryptocurrency investing is right for you, research the pros and cons until you can take a non-emotional, intellectual approach to investing.
Today, the amount he paid for that pizza, 10,000 bitcoins, is worth 106 million dollars.
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