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Crypto is something that you hear a lot about lately, but I've never gotten a grasp on what it is or how buy it and use it. Is there a good non-jewed video I could watch or something I could read that explains it and shows you how to get into it? I've tried to watch a few videos but they're all over the place. There's a ton of foreign concepts to me like wallets, block chain, etc.

Crypto is something that you hear a lot about lately, but I've never gotten a grasp on what it is or how buy it and use it. Is there a good non-jewed video I could watch or something I could read that explains it and shows you how to get into it? I've tried to watch a few videos but they're all over the place. There's a ton of foreign concepts to me like wallets, block chain, etc.

(post is archived)

[–] • 6 pts (edited )

Here's a basic summary:

Bitcoin is a digital currency similar to money in a bank account, rather than physical money like paper bills or metal coins.

Computers maintain an ongoing ledger (history) of how much Bitcoin is in each address. The ledger is public so anyone can see how much is in a particular address, though there is no record of who owns which addresses. Only the owner of an address can transfer their Bitcoin to someone else, by supplying its secret key (like a password). A person can have as many addresses as they want, and it costs nothing to create new ones.

Many copies of the ledger are kept on computers around the world. Updates to the ledger are done in a way that prevents one of these computers from tampering with it. Tampering and fraud are prevented via cryptography and consensus, rather than trust or authority as is done with banks. Transactions cannot be reversed other than by the recipient voluntarily transferring the funds back.

There is a limit of how many Bitcoins will ever be created. This avoids inflation, which slowly reduces the value of everyone's holdings, what happens with fiat currencies like the US dollar. Nothing backs each Bitcoin, so the market value isn't dependent on anything in some vault somewhere, or some third party promising to redeem Bitcoin for something physical of value. Bitcoin's market value is based on the integrity of the mathematics of the system and the network of computers continuing to exist and operate smoothly.

People who maintain the computers that run Bitcoin get paid by the Bitcoin system, which includes a transaction fee that is determined by the market. So as long as Bitcoin is useful and efficient, it funds the computer network that keeps it running.

[–] • 5 pts

One key point, 99% of usd is also only digital.

[–] • 2 pts

99% of usd is also only digital.

Hand-rubbing intensifies.

[–] • 2 pts

Thank you for the reply.

Who generates the key for you to get and use the coin? Who gives the authority?

[–] • 1 pt

Different tokens may require different wallets. There are many types but whatever you're using the seed phrase is randomly generated by the wallet you're using unless you have your crypto sitting on a centralized exchange. Then they have the keys so it is very unwise to keep it there.

The mantra is: Not your keys, not your crypto.

[–] • 1 pt (edited )

If you download the very original Bitcoin-qt client you can download the entire copy of the ledger ( aka blockchain) and it is like 400gb or so in total storage space required. Bitcoin qt client is the original wallet application and in that application there is a “receiving address” section that supplies your receiving addresses associated with your newly created wallet.

https://duckduckgo.com/?q=bitcoinqt+receiving+addresses&iax=images&ia=images

Or you can use popular applications like ones in the App Store like trust wallet or MetaMask.

But you basically have to get you a receiving address somehow and then you can think of it like your home address. And the Bitcoin is the package. So next step is to get some Bitcoin somewhere I.e an exchange like Coinbase, uphold, KuCoin. I personally like to store my long term investments in what people call a cold wallet and then if the exchange gets hacked your coins are safe. And that is because an exchange just has multiple different wallets they use to operate and as we know from history they are a huge target for hackers and I think even some of the exchanges are insured for certain amounts from loss if they get hacked.

[–] • 1 pt

How do I go about getting a cold wallet?

[–] • 0 pt (edited )

The key is generated randomly, and the key is long enough that there's a very low (but not zero) probability you won't happen to choose a key already used. You can generate a key with any method you like, though something truly random is best as you don't want any of it to be predictable. From a given key there is only one address that it controls, mathematically derived. When you submit a request to transfer Bitcoin, you sign the transaction with your key (the wallet software does this). The miners can verify that you had the proper key to sign it.

There's no authority, just whether you have the key to initiate transactions. On the flip-side, anyone can transfer Bitcoin to any address, even the 99.99999999% that nobody has a key to, in which case the Bitcoin is lost forever. This should show how it's just a mathematical space with no central directory of what addresses are used, or who they are owned by. If you have the key for an address, whatever is in that address is under your control.

Best practice is to randomly choose a multi-word recovery phrase made up of many words, that you write down (wallets tend to do this and show the phrase to write down). From this phrase several keys/addresses are generated to use (it's good practice to not keep everything at the same address for a long time). So you keep a safe copy of the recovery phrase so that your computer can be destroyed yet you can still get your Bitcoin with the phrase.

[–] • 5 pts (edited )

The easiest way to get into it is through stock trading apps. You don't actually own the crypto in that case.

The second easiest way is through a marketplace like Coinbase.

You can also get "free" crypto currency through brave browser.

Your best bet is probably something like Coinbase.

Oh and none of the markets are anonymous.

[–] • 3 pts

Also none of those approaches actually have you owning the crypto. You just have IOUs from those companies. You're basically trading paper crypto. A Bitcoin ATM is a nice way to get into it with minimal personal information disclosure. You either get a receipt with the address (and key) for your Bitcoin, that you personally control, or you can set up a wallet on your phone and transfer it to there.

[–] • 1 pt

I looked into the atms and the ones near me require all kinds of id. No idea if they can be faked at all it's just a stated requirement.

[–] • 0 pt

Maybe they've upped requirements. I bought a little years back at an ATM and it only needed a cellphone number. Times have changed, meh.

[–] • 1 pt (edited )

So anonymity is a myth? Ive heard of people using it for that sole purpose. I was just interested in dabbling in it for a hobby. Is coinbase the best app for that?

[–] • 0 pt

There are privacy coins and protocols you can use like monero and tornado cash but blockchains are public so hiding things is difficult. It is quasi-anon because nobody really knows who holds the keys to whatever wallet your coins are sitting in. But the coins can always be tracked easily whenever they move around.

[–] • 0 pt

Arguably, Monero is anonymous.

[–] • 0 pt

You do not want to use stocks, specifically Robinhood, for crypto. If it is somehow gone it's gone. No way getting it back lawfully, even if they steal it by accident.

[–] • 2 pts

Every time you read a headline and think to yourself, "This world is a fucking joke", buy Doge.

[–] • 3 pts

Doge is great because the price is so stable. I've never seen it going for less than 1 doge

[–] • 1 pt

Why dogecoin over anything else such as cardano? Whats the difference? Better futures?

[–] • 2 pts

Remember these: Pulsechain, PulseX and Hex.

[–] • 1 pt

10-4 sir. I will. Whats special about those?

[–] • 2 pts

Most videos lie or obfuscate what Bitcoin actually is to sell their crypto products.

Cryptocurrency such as Bitcoin or Ethereum is the equivalent of owning a set of virtual numbers in a centralized blockchain. Others can see and verify transactions in this blockchain. You can think of a blockchain like an online database or ledger that anyone can see. Your set of virtual numbers is verified through your private key which is an autogenerated password. If you want to buy or sell crypto, you give others your public key (similar to a bank routing number) that tells the blockchain where to allocate your set of virtual numbers. You can think of your 'wallet' as your set of private and public keys. This is mostly represented with a QR code. (square thing)

Bitcoin you can think of is like digital gold and gets its value for being the 1st cryptocurrency.

Ethereum you can think of like digital gas that is used to drive web applications and services that operate on the blockchain.

The security of crypto (and the name) relies on the encryption of your public and private keys which are generated in hopes that supercomputers aren't capable of cracking their algorithm. It also relies that a majority of the mining nodes are honestly representing the blockchain ledger and allocated your set of virtual numbers to the right public keys. (The same as your bank is honestly representing your bank account except your bank is the public bitcoin blockchain). Supercomputers and a 51% attack are the biggest threats and can take crypto to near 0 overnight.

You can buy cryptocurrency through an exchange such as coinbase or binance. You will probably need to upload your ID to connect it to your bank account. IRS will know exactly who you are and your transaction regardless.

So the big question should you buy crypto?

I would take it as payment and cash it out after each big news pump. Too many threats exist that can easily cripple it overnight. Right now it seems to be the main currency for 3rd world nations. Russia and US are going to allow it for now and probably heavily regulate and tax it. If you pay taxes (big if) crypto accounting is a nightmare and the laws are still very unclear what counts as a taxable event. You are also getting double taxes if you buy/sell through an exchange.

[–] • 1 pt

Ok thank you. Lots of stuff.

One more question, if you need an ID to buy crypto then how is it anonymous? Is that a myth? I personally don't need it to be real anonymous but it would be nice to have to option for certain things.

[–] • 1 pt

You can create a wallet and trade centralized cryptocurrencies like Bitcoin and Ethereum without an ID. There are many different websites that do this. The problem comes when you want to cash out your crypto for cash through an exchange such as coinbase.

Most reliable and trusted exchanges are KYC which means they follow banking/finance laws and require customer information to validate their identity and most likely store it on record in case of fraudulent activity. Some exchanges allow you to send crypto to your bank without ID, but the risk is high they aren't legit and they are often limit your transaction amount.

Is crypto on the Bitcoin or Ethereum blockchain anonymous?

Absolutely not, it's open book accounting. However, the blockchain only contains the public keys (numbers represented through QR codes) and their transaction history. If someone figures out that a public key belongs to a certain person then they can be actively tracked and monitored. You can bet all law enforcement and FBI have already been doing this.

What is anonymous?

Privacy-based tokens such as Monero (XMR) are designed to be more anonymous and do a better job at hiding your identity and transaction information. Not much experience with that crypto but seems to be the best bet for anonymous transactions. Assuming that there aren't any hidden backdoor methods for FBI to crack it.

[–] • 0 pt

I cashed out of my (meager) Bitcoin winnings buy buying some real money (gold) from an online metals dealer who accepted crypto. No special ID requirements, just place an order normally.

[–] • 1 pt

if you need an ID to buy crypto then how is it anonymous

You only need an ID from companies that require an ID. Coinbase, for example, wants to stay on the good side of the law, so they'll do everything they can to keep authorities from giving them hard questions to answer.

If I say "send me money via cash/check/moneyapp/giftcard/etc, and I'll send you bitcoin," then your name is never tied to your account. Similar to buying stuff on Craigslist vs Walmart.

And yes, there's websites that coordinate meeting in person for transactions. Problem is, finding an individual person to sell you bitcoin is a lot harder and slightly higher market value than just going to coinbase.

[–] • 2 pts

All questions re crypto can be answered with 2 words.

Monopoly money.

[–] • 0 pt

Same for USD

[–] • 0 pt (edited )

One small and nearly inconsequential difference -- USD is the currency of the USA and can be used to own and trade all land labor and capital contained therein, and it is backed by the most powerful military to ever exist

aside from that yes just monopoly money

[–] • 1 pt

USD is backed by it being redeemable to keep the IRS mafia off your back for a year.

[–] • 1 pt

It is Jewtube but Guy does a good job of explaining the complex nature of crypto to novices. https://youtube.com/c/CoinBureau

[–] • 1 pt

Just remember, don't ever store your private key/seed phrase online, and never give it to anyone. The private key is the money. If you even take a picture of it and store that online, you'll be robbed. Write it down and store half of it in multiple places to be safe.

[–] • 0 pt

I wouldn't even trust it being on any wallet on any online-connected device. Too easy for it to leak the key.

[–] • 0 pt

Good to know. If you trade through an app like coinbase or robinhood then how do you keep safe?

[–] • 0 pt

With those services you aren't directly moving crypto, so you don't even have the key. They own the ceypto and just trade it on your behalf (a benefit is lower transaction cost). The only credentials you have is your login to the site.

[–] • 1 pt

Look, the best way to get started is to just do it with small amounts. Get 20 bucks worth of bitcoin from Coinbase or wherever. Get the electrum wallet or Phoenix or Muun or whatever. Reddit.com/r/bitcoin is actually a decent source of info.

Just start doing it man. Get off your butt and do it. You'll get it over time. You didn't start off knowing how to open a bank account or use a credit card. You just did it.

[–] • 0 pt

Buying btc is gambling your grandchildrens freedom in hopes of making a buck today

[–] • 0 pt

Spending a little on crypto isn't a problem, though. Treat it like the lottery; assume you're going to lose.

[–] • 1 pt

Your unborn grandchildren lose every time

[–] • 0 pt

Why are you interested in crypto? To get rich? To protect your savings from currency debasement? To hide transactions, or send money to other people around the world more easily?

Your interest will dictate whether it has any use to you and whether you have other alternatives to explore

[–] • 2 pts

Just a hobby. For fun or knowledge. Maybe to make a few bucks here and there. To have actual currency rather than the US dollar. To have another, more anonymous option when buying things online.

Theres no singular reason.

[–] • 1 pt

You might want to consider investing in silver. It's not crypto, but it's been money, longer.

[–] • 1 pt

I have some, always getting a little bit more though. I like getting those silver ounces because they'll be easier to trade with when the dollar goes. Its definitely great to have a decent amount stashed back for the future.

[–] • 0 pt (edited )

Sounds like you have the right idea then. Just don't go off the deep end and think you've found the ticket to "getting rich fast". Blockchain technology is incredibly awesome -- like http protocol -- and crypto "currencies" are very interesting too. But currency is inseperable from society and the state; crypto "currencies" have no intrinsic value while consuming real energy and resources, and are still tied to fiat for their valuations (their price is denominated in USD, EUR, yen, etc.). People who get crypto only want to sell it to someone else for more fiat.

Money, finance, banking, and the history of fiat currency are all complex but very worthwhile topics to study.

[–] • 1 pt

Just don't go off the deep end and think you've found the ticket to "getting rich fast".

People think that Bitcoin has created all this value. It's just people being the bigger fool, paying more than the last guy. The early people that cashed out won, at the expense of all the people who bought more recently. Buying Bitcoin doesn't pay some company that's investing it, it's just trading tulips.

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