This is Part Two of a three part SIMPLE look at what I’ve discovered on my journey into decentralized platforms, our new economy. My intention is to inspire smart action as we become aware of what’s really going on in the bigger picture. It’s my belief that it’s up to us individually to do our due diligence. I’m just lighting the fire. I’ve been a newbie, I know what it’s like, and I’m still learning. It’s easy to get overwhelmed about the HUGE changes happening right now in our monetary system, let alone understand what the blockchain is. The key to truly grasping this powerful world is education, knowing opportunity when you see it, and an open mind.
How do cryptocurrencies work?
First and foremost, and this is what has the Banking Systems running crazy around cryptos, is that decentralization creates what is called Peer to Peer (P2P) transactions. Which means, we don’t need a bank, or a third party, to make financial deals/transactions.
From buying goods online, buying a car, a house, creating contracts for deals/agreements, to paying utilities (the list is endless); the future holds the potential for third parties to become obsolete, or at least change their role. Banks, specifically.
This may seem like a bold statement, but that’s our potential IF we so choose. Remember: this is up to US. We the People. If you don’t see that, yet...do more research 😊
On a practical note, what does one need to USE cryptos? We need the right tools.
In order to make transactions, besides the internet & a smart phone, we need:
A Wallet, for daily use.
A trusted & safe place to “store” our cryptocurrencies.
On a basic level, a wallet is HOW you send & receive cryptos, and sometimes trade them. There are two types of wallet systems available:
Centralized.
Decentralized.
Each wallet has a Private Key.
When we have our cryptos in a Centralized Wallet, we do NOT own them. If the company is centralized, they OWN the Private Key. Meaning, they can do with it what they wish, similar to the centralized banking system we are all familiar with now.
When we have our cryptos in a Decentralized Wallet, we OWN them. Meaning only WE have control over them. Unless, of course, we lose our Private Key. Then say goodbye to our cryptos in that wallet. So be careful and remember this wisdom as your Crypto Mantra:
~Andreas Antonopoulus
Most wallets have a smartphone app, making it really easy to carry your wallet anywhere and use it, as long as one has internet...for now. You basically carry your bank with you.
If you want to trade cryptos, or buy something online, it’s a matter of learning how to use your “coins” which are a string of letters/numbers. Copy & Pasting is your bestie, as well as learning how to use a QR code via your smart phone.
Decentralized Trading Platforms are the rage right now, and only getting bigger. Many online spaces are accepting Bitcoin and other popular coins for products, like Overstock.
For everyday use out in the world, there are debit cards available through some exchanges/wallets, and prepaid cards you can send your cryptos to and transfer them into your current preferred currency (or fiat, like USD), making daily spending easier by using a physical “card," online and offline.
There is a learning curve here, yet over time and with our input, it will get easier & simpler to use our cryptos, as we choose decentralization and adoption takes over. Again, research, learn, use what feels right for YOU.
Next, we need to know about storing of our coins, whether to just keep them safe, or for long term holding.
Let’s say you have 1K in cryptocurrency, maybe some of it is Bitcoin, some in Steem, a few Dash, some Monero, etc. Knowing their prices are highly volatile at the moment, and you don’t need to spend it all right now, you’d want to store it to keep it safe, trade them, and/or as an investment.
There are three methods used in the crypto world now:
A “hot” wallet gives you access to your coins from any internet connection, and may or may not have Private Keys you own. Really convenient for small holdings and daily spending, but not the safest for long term storage, or holding.
A “hard” wallet that stores your keys ONLINE, yet has private keys YOU OWN. This is great for holding, but not the very best way.
The most secure is called a “cold” wallet, where you print your “coins” on paper from a printer that is not connected to the internet, and they are stored OFFLINE. This is the safest, and most tedious.
There are many, many tutorials/videos on the variety of wallets out there. This realm is growing daily as the technology refines, and new ideas are born. Again, do your own research.
Stay on top of new information.
Take your time.
Play with options.
Share your experience with developers, so it can be made better.
Become a part of a growing community of early adopters.
Lastly, what is known as two factor authentication (2FA) is mandatory if you love more protection. Set up each wallet with one and you’re one step safer. When you sign up for a wallet, you will be given the choice to do so.
In the end, it’s up to you what you want to do with your coins, and it takes community to make this happen the way we want it to.
The most important choices are being very clear on what a PRIVATE KEY is and HOW to USE Cryptos.
Once you’re set up, buy a bit of coin and play with it. Send it from one account to another and watch the transaction unfold on the Blockchain by putting the receiving address in the box. Then watch it magically show up in your other account! Have fun with it. It's really exciting once you get the hang of it!
Remember, we have the potential to shift our economy from controlled & centralized systems run by those who only care about their power, or claim our own power and use decentralized systems as much as we can, every day. It takes work.
The power truly lies in our hands.
Now that you know why cryptos are so valuable as a decentralized system, and what that looks like on a practical daily basis, on my last post in this trio I’ll share how I began to earn cryptocurrencies and grow my own portfolio.
Anyone, anywhere, can step into a decentralized platform and help change the world...♥
Be True,
Liza