Mark Edwards - Bitcoin: The Ultimate Pocket Guide for Beginners in Bitcoin and Cryptocurrency World

Investing in highly volatile bitcoins and othercryptocurrencies is risky business. These currencies are allelectronic or virtual in nature, and thus have no physicalpresence. They dont even have intrinsic value. However, no one candeny that right now these cryptocurrencies are extremely valuableand those who invested in the early days, and held on to theirinvestments, are living the high life now as multi-millionaires,and even billionaires!

If you want to be like these wise investors sometime in thefuture, then follow these 4 investing strategies to increase yourchances for success.

Its basically a given for cryptocurrencies that they aregoing to be extremely volatile. One minute the price is sitting at5 digits, and the next its at 4 or even 3 digits! Its absolutelyunpredictable, and if you dont take its volatility seriously, youcould get in a lot of trouble. You could panic and sell off yourcrypto so you can minimize your loss.

However, if youve braced yourself for scenarios like this,then youd probably just shut down your computer, or turn off yourTV, and lie down and sleep off your doubts. Tomorrow is a differentday, the price could go back up, and all will be fine with theworld. Being prepared for volatility is tough, but its definitelydoable.

Do your research before you start investing in bitcoins andother cryptocurrencies. When youre dealing with hard-earned money,you dont want to lose everything in one day. Youre investing tomake a profit sometime in the future. Dont go all in withoutstudying what youre putting your money into.

Dont put all your eggs in one basket, so to speak. Dontjust invest in bitcoins. If possible, invest in othercryptocurrencies as well as traditional assets like stocks, bonds,and mutual funds. At least if bitcoin prices drop, then youre notgoing to be totally in the red. Your other investments will helpkeep you afloat.

Investing is a long-term game, and it is not advisable tokeep your cryptocurrencies in online wallets such as yourexchanges wallet, or even your mobile app wallet. Keep yourprivate keys in cold wallets such as paper or hardware walletssince these arent connected to the Internet. You can keep smallamounts in your online wallets, but the bulk of your investmentsshould be offline.

Blockchain is the technology that makes Bitcoin and othercryptocurrencies very secure. Its an open-source and distributeddatabase that is stored in nodes or computers within the network.When new transactions or blocks are added to the blockchain, itwill automatically update itself. Here are 5 very interesting factsabout this ultra-modern technology.

Once an entry has been added onto the blockchain, it will benearly impossible to remove or alter it later. If you want to alteran entry, youd have to basically alter all the transactions thatcame after it. Doing this is mathematically impossible, so evengenius fraudsters would have to look elsewhere to steal bitcoinswithout too much effort. Being tamper-proof is also the reasonbitcoin payments are final and irreversible.

Anyone with access to the blockchain can see all thetransactions that have ever occurred in the past. You can even lookup the first ever block (block 0) that was mined by Bitcoinfounder, Satoshi Nakamoto, in 2009. This genesis block containedthe message The Times 03/Jan/2009 Chancellor onbrink of second bailout for banks.

If criminals think they can hide behind the relativeanonymity that Bitcoin provides, theyre sorely mistaken. Many havetried to evade the long arm of the law by converting their stolenloot to bitcoins and transferring them to different wallets, butwith the transparent nature of the blockchain, computer experts canspot and trace all the bitcoin transactions these criminals haveever done.

Many different startups have started to experiment withimplementing blockchain technology in various industries. Once suchexample is Ethereum with their smart contracts technology whichbasically runs on blockchain. Since the blockchain isdecentralized, two parties can make transactions between themselveswithout needing the services of a middleman. This not only savesyou money, but it also saves you a lot of time and conflict.

While this technology has definitely improved the lives ofmany people, it can still be improved. For one, as time passes by,the blockchain will grow to be several hundred gigabytes of data.This will cause a lot of bandwidth and storage problems on personalcomputers. Lets hope the brightest minds in the crypto space canfind a solution to this predicament soon.

To most people, Bitcoin can seem like a financial conceptmade in a parallel universe. Yes, its a very complex andcomplicated concept, but it doesnt mean its impossible to learnit. When you think about it, many people started off with no ideaabout bitcoins and how it worked. But look at them now, theyreprobably investing left and right in various cryptocurrencies likepros and possibly profiting very nicely as well! So, in thisarticle, well try to simplify how Bitcoin works using a bettinggame analogy:

Imagine playing a betting game with your friends, but none ofyou have any money on hand, so you decide to use a ledger to recordthe transactions, like your winnings and losses. But you dont wantto put your trust on one friend to record everything, so a lot ofyou decide to make a ledger simultaneously.

This way, at the end of each game, those who kept ledgers cancompare their records to see if it all evens outwhich means thatcheating the system would be virtually impossible unless everybodyelse is in cahoots with you, which ultimately defeats the purposeof cheating in the first place.

The ledger is not hidden or exclusive to the ledger keepers;you can view it anytime you want. To add your transactions to theledger, all you have to do is broadcast your transactions to theledger keepers, and you pay as little or as much as you want tomake sure they put your name down on that ledger as soon aspossible.

Your friends who keep the ledgers up to date get compensationfor their hard work with a reward in the form of money. This moneycomes from an external sourcesay, a vault with a limited amount ofmoney. The money in the vault wasnt part of the money circulatingin the betting pool, but it became so once it was acquired by yourledger-keeper friends.

This simple analogy is exactly how Bitcoin operates, albeiton a much more complicated level. Bitcoin runs on a global computernetwork, and each transaction is compiled into new blocks which arethen connected to the last block on the blockchain. And the bitcoinminers are the ledger-keepers who work hard to record transactionsand mine those precious bitcoins.