What Is Bitcoin?
Satoshi Nakamoto's 8 page whitepaper on Bitcoin was the disruption that the financial sector needed.
It presented a programmatic solution to long-standing currency issues, and a route to creating FREEdom and ownership of wealth that are not possible with fiat (government-issued) currency.
However it doesn't take long to realise that while this is a much needed upgrade from an archaic monetary system, it will be very easy to end up with similar wealth disparity issues of today without some conscious intervention.
How is it different to fiat currency?
As fiat currency is not backed by a physical commodity like gold, think of it as an IOU that the national bank should honour although there are currently countries in the world with severe financial challenges that are not able to do this. Bitcoin is backed by the energy and hashing power used to mine it, therefore we will need to increase sustainable energy sources as wider adoption continues.
Additionally the element of being able to have self-custody over your crypto on a hardware wallet avoids the issue of not being able to collect your funds in the event of a bank run as the nature of fractional reserve banking means that banks simply don’t have the money to pay out all creditors at once if required to. Find out more about how this works here:
https://www.investopedia.com/terms/f/fractionalreservebanking.asp
It is also important to note that fiat currency is inflationary, meaning as more money is put in circulation the cost of goods has to increase meaning your money loses value over time and next year you will be able to buy less with it than you can today. Bitcoin is deflationary as only 21 million will ever be mined, and every 4 years there is a halving event where the amount that can be mined per block is reduced by 50%. Naturally this reduction in supply increases demand and historically has led to the price reaching a new all-time high, the most recent halving in 2020 resulted in a steady increase in price until November 2021 when it reached over $69,000 for 1 Bitcoin. At the time of writing in late 2022 we are halfway through the 4 year halving cycle of Bitcoin so it's an optimum time to begin DCA (Dollar Cost Averaging) by buying gradually over time to counteract any large movements in price to help you clear down any debt before becoming a fully fledged FREEconomist.
How do I get some
Register with a central exchange such as Binance, Coinbase or Crypto.com.
Once you have a budget, deposit some of your surplus money in here as it's important to remember that there is no protection if an exchange loses your funds through a security breach or negligence.
This means there is some risk involved but as Jim Rohn says it's all risky!
With some funds in your wallet you will be able to trade these for crypto assets. A good place to start is Bitcoin and you can do some other research into projects such as Ethereum, XRP and XLM to identify if you would like to also have these in your portfolio.
As with any investment the safest strategy is to buy and hold long term as timing the market is not impossible but takes a lot of research and experience.
Once you are familiar with one exchange you can sign up for another to give your portfolio some resilience against any issues with one exchange.
Coinbase and Crypto.com both offer prepaid debit cards so it may be useful to open at least one of these and receive their associated cashback offers when spending on the card in places that accept it.
It would also be wise to consider acquiring a hardware wallet such as Ledger or Trezor, for full self custody of your crypto assets because as they say, "Not your keys, not your crypto". This means if an exchange is holding your crypto assets they are holding the private keys to your wallet and ultimately have full control over them. It's important to buy these from the vendor directly, not a reseller such as Amazon or eBay who could compromise the wallets before sending them to you.
I hope you've found this information useful, please send in any questions or feedback using the email button at the bottom of the page.
