Andy Finch - Cryptocurrency 101

CRYPTOCURRENCY 101

AN INTRODUCTION TO BITCOIN, CRYPTOCURRENCY, AND THE BLOCKCHAIN

Andy Finch

Copyright 2019 Andy Finch

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The material in this publication is provided for information purposes only. Laws, regulations, and procedures are constantly changing, and the examples given are intended to be for general guidelines only. This book is sold with the understanding that neither the author nor the publisher is engaged in rendering professional advice. It is strongly recommended that legal, accounting, tax, financial, insurance and other assistance be obtained before acting on any information contained in this book. If such advice or other assistance is required, the personal services of a competent professional should be sought.

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DEDICATION

T o my parents and Mandy , without whom this book would not have been possible.

CHAPTER 1: MY CRYPTO JOURNEY

W hen I first started out with my crypto journey, I had heard some rumblings in mainstream media about some sort of bit of a coin. I thought to myself, why on Earth would anybody want a bit of a coin? I dismissed it and moved on with my life. However, the rumblings soon got stronger and louder, to the point where I could no longer ignore this fad. I just had to check this out for myself.

I was overwhelmed by the colossal amount of information available. Unfortunately, this was accompanied by the difficulty of identifying what information was good, or fake, or everything in between.

It became glaringly obvious that mainstream media, governments, and most financial institutions were by and large against anything crypto-related, and that the other sources were pro-crypto, with nothing negative ever being discussed, regardless of validity. The information pool was further muddied by individuals and groups promoting agendas of their own. So how do you tell the difference? How do you navigate these treacherous waters?

In my experience, any information you come across will always have a viewpoint that is contradictory. For example, one day Bitcoin prices may be on the up and up and everyone is euphoric, without any naysayers to be seen. The following day, Bitcoin may have a wobble on price and drop a fair amount, and people come out of the woodwork saying they told you so, and that they had predicted the end of Bitcoin, (amongst many other things), 100 years ago. They just KNEW. I want the crystal ball they have.

There are just too many moving parts in cryptocurrency for everyone to agree upon every aspect. Crypto is almost as controversial as religion or politics. I say almost only because the crypto world is relatively small, but it is growing larger by the minute. Just as there are different views for and against politics, the same can be said with regard to cryptocurrency.

Given the unsettling environment of the clear-as-mud crypto era, along with my own experiences in the world of Bitcoin, I decided to write this book to offer some guidance for people who are new to this form of currency and investing. This book is for people who have heard the cry of cryptocurrency, Bitcoin, or the crypto world, but cannot make heads or tails of any of the information they have found on Google, or worse, seen on mainstream media. This book is NOT for experienced traders or people who are already fluently trading in cryptocurrencies.

It is my aim to provide you with the basics of crypto knowledge. Wherever possible, I will use similarities, comparisons, and examples with traditional platforms and currencies to make understanding crypto concepts much easier. I also cover aspects of risks, scams, frauds, and how to spot some of these pitfalls.

Throughout the book, we will use language widely used in the crypto world. Please refer to the Crypto Lingo chapter as you go through this book to help you understand some of these terms.

As a gentle reminder, this books purpose is to provide you with a basic understanding of how crypto operates and to give you sufficient information to allow you to begin your crypto journey with some confidence.

I make no recommendations for any exchanges or coins in this book. There are also no referral links, commissions, marketing payments, shout-outs or anything of the sort. Any mention of exchanges, coins, and other references are purely for illustrational purposes only.

A cryptocurrency is a digital or virtual currency that exists and is stored securely on the Internet. The most famous and recognized cryptocurrency is Bitcoin, which came to being in 2009. The creator or creators of Bitcoin are not known, but the speculation is that the person or group of individuals called Satoshi Nakamoto created Bitcoin.

It is worth noting that Bitcoin was introduced shortly after the banking crisis of 2008 when the worlds major governments and financial institutions were in severe trouble. Some of you may even recall the following event: September 15th, 2008, when the prominent investment bank known as Lehman Brothers declared bankruptcy. In light of this, Satoshi suggested a decentralized system for transactions, or A Peer-to-Peer Electronic Cash System, which you can find on bitcoin.org. (Feel free to Google this). Since then, many cryptocurrencies have been introduced. The whole point was to move away from the centralized financial systems of each country, to a decentralized method of payment that would never again suffer from a banking crisis like the one in 2008.

Why bother with virtual currency, you ask? There are so many reasons! As alluded to above, one of the main reasons that is constantly spoken of is the idea of a decentralized platform that is accessible to everyone. Everyone likes an underdog and we all have a rebellious inside-voice. No one should ever do anything illegal or malicious, ever! However, supporting an underdog and giving the little guy a chance to succeed in this tough economic landscape is not a bad thing.