INTRODUCTORY
As we approach the end of the year, this week kicks off a series of holidays across the globe where many will be visiting family and friends, both in small gatherings and, also this year, some virtually for those who either cannot travel or choose not to travel due to Covid-19 pandemic.
In the USA, Thanksgiving is this week and is a time where loved ones gather to give thanks and stuff themselves full of turkey and other foods. If you are new to cryptocurrency, this could be the first year that the topic of Bitcoin and cryptocurrency may come up in your conversations. If you have been involved for a few years, it may have been the hot topic in 2017 due to prices skyrocketing or it could have been the subject of your loved ones jokes in 2018 and 2019 due to the drastic drops in prices across the board.
This year has been a different and tumultuous year for most, but with what is happening with Bitcoin, it could be your chance to either redeem yourself from the past couple of years or a chance to share your knowledge to open up more people to become cryptocurrency investors, holders, and even traders.
With many central banks and governments facilitating the mass, reckless printing of nations’ currencies, it is easier than ever to point to the numerous issues with current monetary policy and abuse of those policies. Understanding how the current monetary policies work along with what gives anything value will help you share with your loved ones why Bitcoin and other cryptocurrencies actually have value and are not just magic, invisible internet money. Bitcoin has seen plenty of institutional buyers scoop up tens and hundreds of millions of dollars worth of Bitcoin, and that attention alone will help you break down the walls of skepticism of your loved ones.
That is, if you can explain it in an easy to understand manner. It is highly likely if your loved ones know that you are involved in cryptocurrency in any way, they will have questions for you about it. Now, we will look at how to explain Bitcoin and cryptocurrency to your loved ones and, also, resources you can point them so that they can research and learn more about the topics.
WHAT IS BITCOIN?
One of the first questions most people get is “What is Bitcoin?” This is an opportunity to simplify it, so do not start by explaining all the technicals of cryptocurrency and blockchain. Imagine explaining it to your elderly mother or grandmother or even to a child. You do not need to explain consensus algorithms and nonces for someone to grasp the basics of what Bitcoin is, just as you don’t need to understand all the intricacies of a combustion engine to operate a car. The first point to make is that it is money, just digital money. Many struggle to understand how something that is not physical and tangible can be money, but compare it to something that they are familiar with. Using a debit card or credit card, you are using a digital form of money, but that money is just controlled by banks who hold custody of your funds and have to approve your transactions.
Bitcoin can be used peer to peer with no permission needed from a bank or controlling entity. Because of this, Bitcoin is also borderless, meaning you can send to anyone in the world in any country in the world as long as you have their wallet address. If you have ever tried to wire funds to another country using banks or companies like Western Union, you know the headache and costs associated with these transactions. Unlike regular dollars that can just be printed on demand by the controlling authorities, Bitcoin has a finite supply and set release schedule until all Bitcoin has been released. It has value because of the scarcity and demand for it.
The demand revolves around the fact that it can be used to instantly buy goods, sell goods, pay for services, or receive pay for services rendered. It can double as a store of value or even similar to a stock investment that as demand grows and supply remains fixed, the value or purchasing power of Bitcoin will continue to rise over time. Day to day, traders create volatility in the Bitcoin price as the market grapples to identify the true value of Bitcoin, but if you zoom out on the longer timeframe over the years, it is a consistent upward channel of price movement.
The volatility in the short term is something to point out by showing the drastic price swings over the past 3 years, with just this year seeing a low below $4000 to a high at the time of this writing right under $19,000. One reservation some may have is that they feel the price is too high, and they may have “missed out.” It is important to point out to those you are explaining it to that Bitcoin can be broken down to as small as one millionth of a Bitcoin so you can purchase or acquire small amounts, extremely large amounts, and everything in between. Bitcoin wallets are easy and instant to set up and use without any waiting for a central authority to take days to verify you.
HOW ARE BITCOINS MADE?
The next points you want to cover are how new Bitcoin are made and a few points about how the network used to secure the ledger of transactions is more secure than the current centralized systems used by financial institutions. You want to use the correct term of mining but no need to go too deep on this. Just like gold miners invest in equipment to mine gold from the earth with work from the equipment, Bitcoin mining uses computers running software to solve complex equations and earn Bitcoin for doing this and verifying transactions.
The release of new Bitcoin has a hard cap on the total and a set amount released on a set schedule that decreases over time. The work is the amount of energy spent from the computer equipment. Because there is no central server, there is no single point of failure, making it a very secure and reliable network. Without going too deep into blockchain technology, this decentralization not only prevents network crashes, but also makes it virtually impossible for malicious hackers to successfully attack the network. Even if possible, the financial expenditures to try to do this heavily outweigh the incentive from cracking the network. It is independent because no state, bank, or institution can control or manipulate Bitcoin.
Bitcoin’s security is based on cryptography and mathematics. All network participants decide together over the Bitcoin network and its rules. There is no central bank that can print more and more money to reduce the value due to the fact that the total amount of bitcoin has already been established in the core code at 21 million. The nature of the network allows users to also remain semianonymous as you are only identified by your wallet address and not by your actual identity.
HOW TO BUY BITCOIN?
Next will lead to the big question of “How and where do I buy Bitcoin?”
This question can take a complicated turn and you could lose the attention of your audience if you try to make this too complicated. Those of us well versed in cryptocurrency know that holding cryptocurrency in wallets where you control the private keys are your best options, but that may be a conversation to follow up with later.
For now, share ways to easily buy in places where you can link a bank account, but just make sure it is an exchange that allows them to withdraw their Bitcoin from the platform when they understand the importance of custody in the future. For example, in the USA, you can use Crypto.com, Coinbase, Cash App, Gemini, and BinanceUS(BinanceUS not available in every state). Each of these can be used either on their website or they have phone apps available for iPhone and Android. Each of these will require some level of identity verification and linking a bank account or debit card.
While Bitcoin itself is semi-anonymous, the platforms that act as a gateway to buy cryptocurrency are mostly required to verify identity. If you live outside the USA, share the most trusted exchanges in your area. Coinbase, Kucoin, and Binance are the most globally used, but there are others depending on your country of residence.
Once you have verified identity and linked your method of payment, you can begin to make purchases. You have the option on most to buy Bitcoin and other cryptocurrencies. We will look at other cryptocurrencies and what they are below, but for now teaching to buy Bitcoin is the best place to start. Most platforms also have the option to set recurring purchases to buy Bitcoin and others every week, month, or other set period. An accumulation method known as Dollar Cost Average, or DCA, has been effective over time for Bitcoin, but not as much with other cryptocurrencies as of now. If you DCA on other cryptocurrencies, it may be best to sell those when they peak in price.
Other ways to obtain cryptocurrency could be accepting it as payment for goods or services you provide, or choosing it if your employer offers the option to receive payment in cryptocurrency. These options will become more widespread as more and more people adopt the use of cryptocurrency. There are also Bitcoin ATMs where you can insert cash and receive cryptocurrency. Even though these are truly anonymous, just tell others to be mindful of the exchange rate and fees on these ATMs as you could see someone paying 5-10% above market value either in fees or hidden fees through higher prices.
WHAT ABOUT OTHER CRYPTOCURRENCIES?
At this point, you may have your loved ones ask about other cryptocurrencies they have heard about. This could be the other top coins by market capitalization like Ethereum, Litecoin, XRP or others. It could also be some mostly unknown ones as well. At this point, it is important to let them know that most are designed to be some variation or alternative to Bitcoin through varying protocols, use cases, and design. Any cryptocurrency other than Bitcoin is lumped in a term known as altcoins.
There are thousands of cryptocurrencies and just buying random low priced ones in hopes of gains is no more than just gambling. Many cryptocurrencies may pump and dump in price only due to speculative hype, but a very select few ones will stand the test of time due to adoption, implementation of use cases, and demand. It is best to reinforce that they start with and learn from Bitcoin before moving into other cryptocurrencies.
Other ones to look at are ones that have utility and can be bought and spent now, in the case of the NWC token used to access and power the Newscrypto platform. Also, for instance Ether is the main cryptocurrency used as a type of gas fee to use the Ethereum network, whether it be to execute smart contracts or other network activities. There are too many to discuss so it is best to reinforce again they hold off until they can learn how to research other cryptocurrencies. Also, they may hear about cryptocurrency from someone they know who is in a cryptocurrency network marketing company, or MLM. It is best to discourage them from investing in a cryptocurrency MLM. Most in history, even some big ones have collapsed and most, if not all, represent some sort of illegal sale of securities in the eyes of most governments.
RESOURCES
Now it is important to have some resources to send your loved ones to as they further explore this rabbit hole. Do not try to explain every single aspect. Point them to the information and let them do the research.
Some may be happy with just making a purchase on Coinbase and not going any further, while others may want to learn all the intricacies of Bitcoin and blockchain. Another thing you can do to help solidify their interest is to have them download a wallet and send them a little bit of Bitcoin. Even if it is just a few dollars worth, people are more likely to learn more about something they own. Most exchange gifts during the holiday season so why not make all or part of your gift some Bitcoin for your loved ones. You can print paper wallets for this or simply have them download a wallet app and then scan and send them Bitcoin. It is truly a gift for all ages. If you had done that in 2018 and 2019, your entire family would be buzzing about Bitcoin at this year’s holiday gatherings.
One great place to start is have them create a free account on Newscrypto website:
https://newscrypto.io/, and browse the education and tutorial sections of the platform. Another great resource is to visit: https://bitcoin.org/en/ to read the basics of the Bitcoin whitepaper, released by the anonymous figure Satoshi Nakamoto back in 2008. This website also has some basic information about Bitcoin as well as a short explainer video. For those that are visual learners and want more videos after watching the Newscrypto videos should be directed to the YouTube channel of Andreas Antonopolous, one of the brightest minds in the Bitcoin space.
Here is the link directly to his playlist called Introduction to Bitcoin:
Not everyone will want to know as much as you may know about Bitcoin and cryptocurrency, but the more you can do to break down the knowledge barriers and overcome skepticism, the closer we all can get to mainstream adoption and the inevitable of prices rising on Bitcoin and other solid projects due to rapidly increasing demand. Share your knowledge in an easy to understand manner and do not be argumentative with those who are skeptical or refuse to believe in what you are sharing with them.
They will eventually come around as time goes on. Cars were considered crazy death traps and one point in history, cell phones were expected to fail, and even the internet was once called a crazy fad. Continue to share with those who want to learn more during the holidays, and on into the new year. The more you share with others, the more you will learn as well. When one teaches, two learn. Have a safe and productive holiday season as you share the future of money with your loved ones.
Thank you for attention!
Blockchain Wayne and Newscrypto Team.
