Crypto updates - More big news

A few big stories in the crypto space this week.

The B-Word conference featuring Musk, Jack Dorsey and Cathy Wood was another step towards bringing mainstream attention to Bitcoin and other crypto. It also sparked what seems to be the second half of this cycle's bull run.

- Musk revealed that Tesla, Space X and his own portfolios all contain Bitcoin.

- Musk was keen on accepting BC as payment for Tesla products again and said they wanted to confirm claims that BC mining is presently well over 56% done with renewable energy. (Very few will actually buy products using BC but in terms of vouching for Crypto, Tesla's endorsement is massive.)

- Jack Dorsey revealed that Twitter now have a fully operational crypto department and it seems Twitter will incorporate Bitcoin into it's model relatively soon. Dorsey also mentioned Blue Sky and the drive towards blockchain based social media. Particularly how it is miles ahead of anything achievable with previous generation programming, on every front.

- Dorsey is also developing a non-custodial crypto wallet and will no doubt punt it through twitter. Again, not as much interested in the wallet as I am in the exposure that will result from Dorsey and Twitter advertising it.

I'd suggest those interested watch the BWord conference if you can. Even if it's just to see the absolute reverence Musk commands from even the most high profile captains of industry. The guy really is something else.

The day after the B-Word happened, Bank of America announced it is making crypto available to retail clients...over the counter. This follows a similar move a few weeks earlier by German banks. I can't see this as being anything other than huge news.

Amazon, it seems, is also making crypto payments available in the near future. I'm not entirely convinced by crypto payments just yet but exposure to crypto is what's needed and it's exactly what these entities are providing right now...in heaps.

There is a lot more news, and I'll do a bit more of an in depth post regarding NFT(Non Fungible Tokens) in the near future. The best, though not entirely accurate, comparisons I can make is that Bitcoin is like better gold, Etherium is like better internet and NFTs are new and better means of certifying the ownership and authenticity of just about anything. 

The smartest people and biggest businesses all over the world are realising what is happening and outside of the occasional bit of fud, crypto's momentum is only gathering pace. 

It is still early doors, good news for those still wanting to get involved, but it does appear that mainstream adoption is set to explode some time after Ethereum 2.0 launches. As it sstands, we're not a million miles away from 100k new crypto wallets being opened daily. Think about that for a moment.

Here's one example....

In Q1 of 2020 Ethereum network processed around $21B of transactions on it's network. In Q1 of 2021 this figure rose $750B. This is simply amazing and even more so when you consider that this growth was achieved before Ethereum is even in its final form as a network.

PS - I think that along with these headline updates on crypto, I'll always attempt to add a basic and brief description of what certain elements crypto space are. Perhaps, over time, those interested, including myself as I research different elements of the space in order to post here, will gradually get our heads around what is a daunting topic. 

I heard that, was it 47 governments, will have crypto currencies that they control.

Bye bye Bitcoin etc. When that happens they will send Bitcoin packing for reasons mentioned before. But before that happens you could make some money?

Beeno,

Governments' central banks are starting their own cryptocurrencies as ancillary to BC etc, rather than to replace it. 

The best a country's ancillary crypto can hope for is to be used as a second layer, sitting on top of other cryptos, for transactional purposes or to simply be used as a replacement to paper money. In a sense, it's not much different to using your bank card to pay for goods since the money in your account is represented as codes rather than paper bills. Central bank-tied crypto simply creates a token for each unit of fiat currency in your account. That token can then be used to transact. 

However, they remain tied to the central banks and the fiat currency in the country it serves with the value therefore being derived in the same way that current fiat currency is. 

NFT's are more where governments will have involvement. Here, local laws will determine the ownership, authenticity and validity of an item. Governments will then issue NFTs for items within their remit. Like a driver's license for example. A foreign entity will not be able to issue a non-fungible token for a South African license unless authorised to do so by the SA gov. And again, the systems storing and managing these NFTs are platforms such as Ethereum etc.

Plum would you perhaps know a reliable and reputable source where one can study, examine and exploit and transact these opportunities that are available?

I'm a cautious investor and never overdo high risk but am prepared to put a bit of surplus into such ventures in moderation.

Lekker Seb.

In terms of buying and trading, Luno.com has been around for ages and probably the most reliable service available in SA. They have a double authentication system and are quite secure. 

There are two ways to buy crypto from them. You can buy directly from them which is very easy. The other option is to click on the "Exchange" page. There you will find people trading Crytpo through a "Sell offer" and "Buy offer" system. It's also very easy, and much cheaper than buying directly from Luno's main page where they charge 2% of your sales and purchases as opposed to 0.01% when you buy from Lunos exchange page.

I'll have some time a little later on today and will post some guide videos on how to use Luno.

I'll also post some starter videos on crypto so that you can start familiarizing yourself with what it all is. 

Great you're interested and even if you don't get involved, it's still a very interesting subject to learn about. 

Seb,

I made a moerse long post for you here yesterday but my internet went down at some point during. When I clicked to post it took me to the <no network> page and I couldn't retrieve the post.

I'll try again today

When will I learn to click copy before posting? 

Thank you.

Seb, let me try again.

Blockchain is a decentralised ledger network. Instead of one location holding the ledger, all locations on the network hold and can verify the ledger's contents. 

Most of the money in the world today is held as a digital code. And that's true for all but a few obscure currencies. The problem is that copying the code for a unit/quantity of currency and then pasting it so that you've basically doubled the money creates something known as the double-spend problem. 

Banks solve this problem by using a centralised ledger system that can detect and deter these types of occurrences. The problem is that data is only as secure as the network that protects it. And when you have a centralised network, verification is a cumbersome process in the face of the need for faster and faster transaction times. 

Bitcoin is the first attempt at digital currency, of which there have been very many, that solves the double-spend problem perfectly while increasing transaction efficiency and security by orders of magnitude. 

To put it into perspective, Bitcoin is a transparent network. It's information is visible to anyone whereas the centralised ledger system your bank uses is entirely private. The reason your bank's ledger is secret is because it could easily be overwhelmed by an attacker with greater computational power. 

However..."the security of the Bitcoin blockchain is based on the great hash power that many nodes participate in the proof of work which makes it impossible for an attacker to provide a higher amount of computation."

Hash rate or #rate, is the term given to the amount of computational power being exercised on the Bitcoin blockchain. 

When you have heard of Bitcoin mining in the past, this mining is what creates the hash rate. The more miners there are using more hardware for computation on the network, the higher the #rate is of the network is.

So what is mining? 

Bitcoin or crypocurrency mining is basically when a computer, of some size, is connected to the network and is carrying out computational math in service of the network. Blockchains that operate in this way are called Proof Of Work networks. Here, your computer does a certain amount of computation for the network and in so doing you earn the currency of that specific network.

In the case of Bitcoin, there are a limited number of Bitcoins to be mined. There were initially 21 000 000 coins programmed into the system, and by carrying out mining, about 18 500 000 Bitcoins have been uncovered to date. There are around 4 000 000 Bitcoins for which people have lost or discarded the keys and which can never be retrieved. Therefore, once the final 2 500 000 Bitcoins have been mined, there won't be any more than about 17 000 000 Bitcoins in circulation.

Proof Of Stake is another kind of blockchain network. Either the network will have been proof of work and moved over to proof of stake, or the network simply started out as a proof of stake network. Here, instead of mining the currency to earn/unlock more of it, you hold the currency to earn more. IE miners are replaced by holders.

Ethereum is currently a proof of work network and will be making the transition to proof of stake in the future. 

What makes all of this useful? In short, everything.

From banking, contracts, certification all the way to copyright and investment...the decentralised, easily verifiable and widly available network service that blockhain offers, just blows everything else out the water. 

It's kinda like when cellphones arrived in the telecommunications industry. Only, much more wide-ranging. You'll note, if Telkom didn't start selling cellphones, they'd probably not be around today.

In reality, people have been scratching the surface of the use-cases for blockchain but it's like trying to understand where the internet would go back in 1994 when it became mainstream. 

And this is before we consider Cryptocurrency as a store of value and thus an asset. When you own a cryptocurrency, you own a percentage of that network's nodes. The higher the use-case of second layer technology built on top of it, the greater the value of your asset. Owning cryptocurrency is like owning a part of the engine or operating system on which the networking technology of the future will be built.

This is a great video. Doesn't cover ever ything but does do a good job, regadless.

Much appreciated...thank you.

All good, Seb.

I'm very glad you're interested. 

If you do end up opting in, I would suggest Ethereum.

It's at the core of most DeFi(decentralised finance) applications and its growth in use-case is putting the early days of any other technology in human history go shame.

I bought Eth earlier this month when it was at a local low. And I intend to hold it for at least five years. 

That's generally the way to look a t crypto. Buy, take enough profit to cover your investment, and then hold long term.

Have a look at the charts since crypto became a thing and you'll see why I say that.