Laypersons reading or hearing about cryptocurrency and blockchain may be confused by the vast number of things they need to learn about and consider. However everyone has to begin somewhere. The key is not to be worried, not to be overwhelmed, and just enjoy the learning journey. Also, one’s working knowledge does not need to be too deep in some areas unless you plan to become a developer in that particular technology. There are however some basics that should probably be learned immediately.

Different people have different reasons for going into crypto. For many, it is the chance to make some money. For others it is curiosity about this new technology, or new capabilities such as sending money quickly to friends and family abroad. One quickly hears about real world analogies about mining or staking, but sometimes the analogy is a bit stretched. There is also a lot of joy and disappointment. Some people might see their money double or triple suddenly in a few hours or days. Others may experience the opposite if they buy at an all time high price. After a few weeks, their money is cut in half or more.

Since many beginners are used to traditional banking, they will often make comparisons as to why things cannot be like this or that. But they are also impressed at certain advantages like the speed of transfer, or the fact that they do not need a bank to approve a transaction. On the other hand, they will receive warnings to be careful because there is no customer service to help them get their money back if they make a mistake. 

A better approach is to perhaps simply acknowledge that crypto is a new thing. Of course to some extent it tries to mirror what we are used to. But make no mistake, crypto is a peer to peer trustless system. You do not need trusted third parties like banks, middlemen, lawyers, etc to transact. There is also the unique jargon that accompanies it. Wen and HODL are intentional misspellings of “when” and “hold.” Just take it as it is.

Buying crypto from centralized exchanges like Binance, Coinbase, etc have a slight learning curve but they may be similar to traditional online stock accounts. Using decentralized wallets however is a more advanced technique. You basically custody your own crypto in your own wallet. Each wallet has a hexadecimal address which you have to use as the destination for any crypto you receive or buy, and likewise you need the hexadecimal address of the wallet you will send or sell crypto to. Don’t forget to send the crypto on the right blockchain. Try to send Bitcoin on the Ethereum network, and it will get lost forever. 

You may have also heard of NFT. NFT stands for Non Fungible Tokens, meaning that each token is unique as opposed to a fungible token like Bitcoin, which is interchangeable with other Bitcoin. Initially NFTs started with simple low resolution images but have lately been upgraded to high resolution color works of art, or even utility NFTs that tokenize or represent real world assets like houses, cars, watches, luxury bags. You name an asset, and it might be possible to tokenize it with an NFT.

Then there is P2E. P2E stands for Play to Earn, a new generation of games on the blockchain that allow players to earn money while playing. Sounds good right? Some Filipinos who play the most popular P2E game, Axie Infinity, have earned enough to quit their jobs and buy condominiums or houses, but lately the income has started to taper off. Although some in the gaming community do not like P2E and NFTs on their turf, increasingly it is taking greater hold as time goes by.

The knowledge above just forms part of what you will learn in the world of cryptocurrency and blockchain. There is much more to learn. But rather than try to absorb everything in a short time, just enjoy the learning process. Don’t be ashamed to ask what certain things stand for.

Enjoy the journey.

Leave a Reply

Your email address will not be published. Required fields are marked *