Crypto

The Basics of Crypto

Welcome to the world of cryptocurrency! Whether you’re a complete newbie or a seasoned trader, this space is designed to give you everything you need to navigate the exciting and sometimes overwhelming crypto world. From the basics of blockchain to advanced trading tips, you’ll find valuable insights and tools here.

The Basics of Blockchain Technology

What is Blockchain? Blockchain is a digital ledger that records transactions across multiple computers. It’s decentralised, meaning no single authority or organisation owns it. Think of it as a transparent, tamper-proof way of storing information.
Why is Blockchain Revolutionary?
- Transparency: Anyone can verify transactions.
- Security: Data is encrypted and spread across a network, making it almost impossible to hack.
- Decentralisation: Eliminates the need for middlemen like banks.

In simple terms – Imagine a notebook that everyone in the world has a copy of. If someone writes in it, everyone’s copy updates instantly. No one can erase or fake an entry without everyone noticing!

What is Cryptocurrency?

Cryptocurrency is like digital money that uses blockchain technology to ensure secure, decentralised transactions. Unlike traditional money issued by governments (fiat currencies), cryptocurrencies are not tied to any central authority.

Key Features:
- Digital and Global: Accessible anywhere with an internet connection.
- Peer-to-Peer: Send money directly to anyone, without intermediaries.
- Limited Supply: Most cryptocurrencies have a fixed supply, which can make them a good store of value.

What is Bitcoin, and Why is It the 'Daddy'?

Bitcoin (BTC) is the first and most well-known cryptocurrency, created by an anonymous entity called Satoshi Nakamoto in 2009. It’s often referred to as “digital gold” because of its scarcity and value.

Why Bitcoin is Special:
- Limited Supply: Only 21 million Bitcoin will ever exist.
- Decentralised and Trustless: No central authority or bank controls it.
- Secure and Transparent: Built on blockchain, where transactions are publicly verifiable.
- Pioneer Status: It started the crypto revolution, paving the way for thousands of other coins.
- In Demand: We are starting to see Governments and businesses incorporate it into their financial systems

What are Altcoins?

Altcoins (alternative coins) are any cryptocurrency other than Bitcoin. They often aim to improve on Bitcoin’s technology or focus on specific use cases.

Popular Altcoins:
- Ethereum (ETH): A platform for creating decentralised apps (DApps) and smart contracts.
- Binance Coin (BNB): Used for trading and reducing fees on the Binance exchange.
- Cardano (ADA), Solana (SOL): Competing networks with faster transaction speeds and lower fees.
- Stablecoins (e.g., USDT, USDC): Cryptos tied to the value of a fiat currency to reduce volatility.

What is a Crypto Exchange?

A crypto exchange is a platform where you can buy, sell, and trade cryptocurrencies.

Types of Exchanges:
- Centralized (CEX): Managed by a company (e.g., Binance, Coinbase). User-friendly but involves trusting a third party.
- Decentralised (DEX): No central authority, trades happen directly between users (e.g., Uniswap, PancakeSwap). Offers more privacy.
Key Features to Look For:
- Reputation and security.
- Supported coins.
- Fees and liquidity.

Wallets: Keeping Your Crypto Safe

A crypto wallet stores your private keys, which allow you to access and manage your cryptocurrencies.

Types of Wallets:
- Software Wallets: Apps for your phone or computer (e.g., MetaMask, Trust Wallet, Phantom Wallet).
- Hardware Wallets: Physical devices for offline storage (e.g., Ledger Nano, Trezor).
Custodial vs. Non-Custodial:
- Custodial: The exchange or a service manages your wallet (e.g., Coinbase wallet).
- Non-Custodial: You’re fully in control of your private keys. (Phantom, Metamask)

What is a Ledger?

A ledger is a specialised hardware wallet that keeps your private keys secure. It is one of the safest ways to store crypto because it’s offline and immune to online hacking attempts.

How to Use a Ledger:
1. Buy from an official source to avoid tampering – Ledger.com NEVER buy off ebay, Amazon etc where it could have been tampered with
2. Download Ledger Live to your desktop and follow instructions
3. Use it to send or receive crypto by connecting to your computer only when needed.

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