I almost hesitate to write the name out of sheer exhaustion at its ubiquity-but, deep breath, here it goes: cryptocurrency. Have you been as fed up with hearing about this as I was just a couple weeks ago, when explanations of it usually focused on Bitcoin-together with breathless narratives of the life-changing, bank-account-invigorating wonderments, popped up everywhere turned in my news reading, my Twitter-feed scrolls, and my newspaper lifestyle trend pieces? When one of my best friends started ranting and raving concerning the entire “blockchain revolution” and his awesome recent decision to toss some money into Crypto Prices (which had, yes, gone from $900-something at the start of a year ago to around $20,000 toward the conclusion of the year, as of this writing, it hovers around $11,000), I vented my rage at the entire puffed-up concept by demanding he convey to me what type of hectic nonsense this entire scheme amounted to.
You know what? It’s not too complicated. But yes, right about now seems an apt time to have an all-important notice to my dear readers: You’re about to read financial advice from somebody that until a week or two ago had, within the entirety of his life-aside from some fairly rote 401(k) behavior-invested in stock market trading exactly once. After I was 13, a company-savvy family friend mentioned something about Chrysler staking their financial well being on the new sort of car; if this worked, he stated, the company’s stock might skyrocket; if this failed, obviously, the company was finished. Somehow, I managed to buy a handful of shares from the stock at about $3-that i then sold around the time the stock peaked several months later somewhere around $16 or $18, netting myself a handy hundred bucks roughly together with the directly to pat myself on my greenhorn greed-is-good back. But having once ridden the white lightning with your blistering success, I figured, Why not quit as i was ahead?
Understanding crypto, though, is simple-with a little the help of Samuel Taylor Coleridge’s perpetually useful willing suspension of disbelief. You don’t need to browse the myriad stories and posts and think pieces on how to understand crypto, or Bitcoin, or even the coming transformation of our entire means of doing everything: They’re generally overly complicated and, perhaps moreover, just not that much fun. May I explain to you just how blockchain technology-the DNA of crypto, should you will-works? Of course not. I can tell you that it works something such as this: Bitcoin along with other cryptocurrencies basically record every transaction and distribute the records of these transactions equally to all parties involved. Every now and again a “block” of such transactions is verified and essentially sealed up and stacked on top of the very last block, creating a chain.
Within the cryptocurrency world, these “transactions” are users selling and buying different cryptocurrencies, usually in the form of virtual “coins.” (A few of the more well known ones: Bitcoin, Ethereum, Ripple, Litecoin.) When individuals talk about the “blockchain revolution,” they’re generally noting the blockchain can be used for secure transactions of almost any type: storing and moving birth certificates, votes, insurance claims, whatever. The revolution I’m concerned with most presently, though, is the one about to happen inside my banking account.
Here’s where the skeptics can be found in: “But these ‘currencies’ derive from nothing!” they wail, gnashing their teeth and furrowing their brow. To which I summon each of the high-minded derision that the one-time philosophy major (I jettisoned that idea faster than my Chrysler stock) can summon in responding: “Since Nixon took us off the gold standard in 1971, our entire monetary product is based solely on shared assumptions, man.” The dollar bill is, at root, some paper that has value only because it relies on the “full faith and credit” of the usa. Well, crypto is just like that, with one exception: It relies on the “full faith and credit” of . . . of . . . of whoever decided to write the white paper that declared the actual cryptocurrency involved as a thing of value. (In Bitcoin’s case, that individual, or group of people, operates under a pseudonym-see above in re: willing suspension of disbelief.)
So, yeah, it’s sketchy. (Riddle me this, though: How many concepts that you know of this begin with “crypto-” aren’t?) Let’s put an optimistic spin into it, though, and refer to it as untested. And then let’s test it. Honestly, it’s the simplest way to figure it all out. Here’s everything you do (or don’t do, if you’re the kind of person that has qualms about putting your hard earned money axtisi hazy concepts that could collapse at a moment’s notice but that can be the magical money-spawning harbingers of our collective future): Take the kind of walking-around money that you’d blow on a couple of shoes that seemed necessary for about five minutes, or the same as an enjoyable-but-forgettable evening out on the town. Open up a Coinbase account. Coinbase is an exchange for the biggest cryptocurrency players-think of it as the New York Stock Exchange for crypto. It’s where you buy and then sell coins, or fractions of those. (Just trust me on this one: Coinbase is every casual player’s entrée; it really is to crypto what AOL would be to getting online during the early ’90s.) You link a credit card in your Coinbase account and get Bitcoin, Ethereum, or Litecoin. (Bitcoin, while somewhat Captain Obvious, is definitely the crypto that’s most easily converted into other kinds of coins; it’s even the one that’s most generally accepted as payment for actual goods and services, from OkCupid to Etsy with an alpaca farm in rural Massachusetts.)
So, yeah, it’s easy. You will find, it may be addictive. As opposed to reflexively checking Twitter or Instagram while waiting for the train, I’m now watching the sine curve of my crypto account on one of various apps. My Twitter feed features a new, almost psychotically geeky component: Crypto Twitter. My spouse came home another night coming from a evening out to locate me watching neither tennis nor politics but, rather, a YouTube video of any teenage boy who I likely wouldn’t trust to walk my dog dutifully explaining the best way to convert Litecoins on Coinbase to Ripple coins on that aforementioned China-based exchange, Binance, utilizing the GDAX exchange as an intermediary host in order to avoid trading fees. (Reader, it worked!)
So, how am I doing? With a whole fourteen days under my belt, my main anxiety over my “investments”-still it feels a bit grand to make use of the word, considering that the midnight-sweats a part of my psyche continues to be convinced that the more here is definitely an invention of Chinese intelligence to raid our pocketbooks after their Russian neighbors raided our democracy-is because they are, well, maddeningly stable. The $400 amount of Litecoin I started out with (I got in a dip on the market) is maybe $20 down; the $400 in Ripple that I jumped over a week later during the things i thought was actually a preposterous low is up merely a $20 approximately; as well as the $200 in Bitcoin which i dutifully purchased several days after that is essentially the same. (There already is, though, The One Which Got Away: After reading the proverbial “hot tip” from what appeared like a credible source on Twitter, I yearned to buy the XLM coin from Stellar, which, the origin said, was poised to “take off.” Yee-haw! Of course, this is the sort of thing I told myself I wouldn’t do-at the very least until I learned much more about how all this works-so I didn’t. Also needless to say: The coin, which is up almost 30,000 percent within the last year, gained another 20 percent in the day or so since i have passed it up.) I’ve even bought a “digital wallet”-you are able to store your cash on the exchange you get it on, though, to date, only Coinbase guarantees it, so it’s recommended you retain funds on these tiny bits of hardware-but, because of the insane demand, it’s on backorder until March, so for the time being, well, Bitcoin better have my money.