I almost hesitate to write the name out of sheer exhaustion at its ubiquity-but, deep breath, here it is: cryptocurrency. Are you as fed up with hearing regarding it when i was just a couple weeks ago, when explanations of it usually focused on Bitcoin-in addition to 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 among my best friends started ranting and raving concerning the entire “blockchain revolution” along with his recent decision to toss some funds into further reading (that have, yes, gone from $900-something at the outset of this past year to around $20,000 toward the end of the year, since this writing, it hovers around $11,000), I vented my rage at the entire puffed-up concept by demanding he convey to me what kind of hectic nonsense this whole scheme amounted to.
Guess what? It’s not that complicated. But yes, right about now seems an apt time for an all-important notice to my dear readers: You’re going to read financial advice from somebody that until a couple of weeks ago had, inside the entirety of his life-apart from some fairly rote 401(k) behavior-dedicated to the stock exchange exactly once. Once I was 13, a business-savvy family friend mentioned something about Chrysler staking their bottom line on a new sort of car; if it worked, he explained, the company’s stock might skyrocket; when it failed, obviously, the company was finished. Somehow, I was able to buy a handful of shares in 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 right to pat myself on my own greenhorn greed-is-good back. But having once ridden the white lightning with such blistering success, I was thinking, Why not quit as i was ahead?
Understanding crypto, though, is straightforward-with a bit of assistance from Samuel Taylor Coleridge’s perpetually useful willing suspension of disbelief. You don’t have to browse the myriad stories and posts and think pieces about how to understand crypto, or Bitcoin, or perhaps the coming transformation of our own entire method of doing everything: They’re generally overly complicated and, perhaps moreover, not so much fun. May I let you know exactly how blockchain technology-the DNA of crypto, if you will-works? Of course not. I will tell you it works something like this: Bitcoin as well as other cryptocurrencies basically record every transaction and distribute the records of those transactions equally to any or all parties involved. Every now and again a “block” of those transactions is verified and essentially sealed up and stacked on top of the last block, making a chain.
Inside the cryptocurrency world, these “transactions” are users buying and selling different cryptocurrencies, usually as virtual “coins.” (A number of the more well known ones: Bitcoin, Ethereum, Ripple, Litecoin.) Whenever people talk about the “blockchain revolution,” they’re generally noting that this blockchain can be used secure transactions of almost any type: storing and moving birth certificates, votes, insurance claims, whatever. The revolution I’m focused on most presently, though, is the one about to happen within my bank account.
Here’s where skeptics come in: “But these ‘currencies’ are based on nothing!” they wail, gnashing their teeth and furrowing their brow. Which I summon all of the high-minded derision that this one-time philosophy major (I jettisoned that idea faster than my Chrysler stock) can summon in responding: “Since Nixon took us from the gold standard in 1971, our entire monetary system is based solely on shared assumptions, man.” The dollar bill is, at root, a bit of paper which has value only since it relies on the “full faith and credit” of the usa. Well, crypto is the same as that, with one exception: It relies on the “full faith and credit” of . . . of . . . of whoever made a decision to write the white paper that declared the actual cryptocurrency involved to become a thing of value. (In Bitcoin’s case, that person, 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 you are aware of this begin with “crypto-” aren’t?) Let’s put a good spin on it, though, and refer to it as untested. And after that let’s test it. Honestly, it’s the simplest way to figure it. Here’s everything you do (or don’t do, if you’re a person that has qualms about putting your hard earned money axtisi hazy concepts that may collapse with a moment’s notice but that may also be the magical money-spawning harbingers of our own collective future): Take the kind of walking-around money that you’d blow on a couple of shoes that seemed required for about a few minutes, or perhaps the same as an enjoyable-but-forgettable night out on the town. Start a Coinbase account. Coinbase is an exchange for that 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 is to crypto what AOL ended up being to getting online in early ’90s.) You link a charge card in your Coinbase account and buy Bitcoin, Ethereum, or Litecoin. (Bitcoin, while a little Captain Obvious, is the crypto that’s most easily transformed into other sorts of coins; it’s even the one that’s most generally accepted as payment for actual products or services, from OkCupid to Etsy with an alpaca farm in rural Massachusetts.)
So, yeah, it’s easy. You will find, it can be addictive. As opposed to reflexively checking Twitter or Instagram while awaiting the train, I’m now watching the sine curve of my crypto account using one of countless apps. My Twitter feed has a new, almost psychotically geeky component: Crypto Twitter. My partner came home one other night coming from a particular date to find me watching neither tennis nor politics but, rather, a YouTube video of any teenage boy who I likely wouldn’t trust simply to walk my dog dutifully explaining how to convert Litecoins on Coinbase to Ripple coins on that aforementioned China-based exchange, Binance, making use of the GDAX exchange as being an intermediary host so as to avoid trading fees. (Reader, it worked!)
So, how am I doing? With a whole 2 weeks under my belt, my main anxiety over my “investments”-it still feels a bit grand to utilize the phrase, given that the midnight-sweats a part of my psyche continues to be convinced that the Trading Bitcoins 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 worth of Litecoin I started out with (I bought at a dip available in the market) is maybe $20 down; the $400 in Ripple i jumped on a week later during a few things i thought was actually a preposterous low is up merely a $20 approximately; and also the $200 in Bitcoin which i dutifully purchased several days next is basically the identical. (There already is, though, The One That Got Away: After looking at the proverbial “hot tip” from what sounded 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 type of thing I told myself I wouldn’t do-at the very least until I learned more details on how all this works-so I didn’t. Also obviously: The coin, that is up almost 30,000 percent within the last year, gained another twenty percent within the day roughly since i have passed it up.) I’ve even got a new “digital wallet”-you can store your money on the exchange you purchase it on, though, to date, only Coinbase guarantees it, so it’s recommended you continue funds on these tiny pieces of hardware-but, due to the insane demand, it’s on backorder until March, so for the time being, well, Bitcoin better have my money.