Cryptocurrency Resources & Tools

I have received a lot of inquiries about Bitcoin and other “cryptocurrencies” recently.  As a finance related subject, I believe it is important to help individuals educate themselves so I offer the following learning resources.

I am not acting as an investment adviser in ANY capacity regarding information in this communication about  cryptocurrencies (CC).  As a finance topic, I am willing to pass along information to help people educate themselves further.  The information contained herein and referenced externally is not enough information for anyone  to enter the market for cryptocurrencies.  Anyone that does their own research and gets involved with CC will need to stay engaged in the subject as future developments may require their attention.  I am not offering any ongoing assistance in this area at this time.

THE FOLLOWING INFORMATION IS FOR EDUCATIONAL PURPOSES ONLY.

 

Warning, the cryptocurrency market is ripe for scams and there are likely many underway as I type these words.  Proceed with caution and consider working with friends, family members, colleagues, etc. to explore this area together.

Individuals interested in understanding Bitcoin and related CC might want to begin by watching the movie, Banking on Bitcoin.  It it also available on some on-demand networks.  The documentary may help an individual determine their interest level in this subject.  Another important video for understanding the ebbs and flows of the U.S. credit based economy can be found on YouTube, How The Economy Works, by Ray Dalio.

Phone App/Information Sources

A phone app, like HODL, can also be a great resource  where fundamentals, news, charts and posts for different CC can be reviewed.  A good app on your phone that tracks cryptocurrencies is a critical tool and next step for anyone interested in this market but you have to be careful, not all information is the same.  Here are the names of a few respected thought leaders on the subject of CC.

  • Andreas Antonopoulos (Mastering Bitcoin book)
  • Trace Mayer (Bitcoin knowledge podcast)
  • Jimmy Song (Twitter)

Read posts on Reddit/Medium for information and support on many CC subjects ( currencies, exchanges, and wallets).  There are also support forums for technical issues.  There have been many different types of technical issues in the past and they should be expected in the future.

There are also blogs and newsletters dedicated to this topic, some better than others; you should be able to find several dedicated information sources on CC to explore and compare.

Also, when comparing the different CC, you are well served to dig into detail around factors that may have a big impact on the future of a CC.  Here are a few additional topics to become familiar with overtime.

  • Governance – How are decisions made about the future of the CC?
  • Programmability – How easy it is to add features to the blockchain of the CC?
  • Development Funding – How is the CC funding future development, upgrades, marketing, research, etc?
  • Merchant/Payment Tools – How robust are their services and tools for merchants/ecommerce developers?

There are many other subjects to consider (Encryption Type, Hashing Power, Mining Reward, Transaction Validation, etc.) with cryptocurrency and the underlying blockchain supporting it.  This is a very fragmented and rapidly developing technology; the list of subjects above is incomplete but will help you dig into details you will want to understand if you are serious about CC.

Exchanges

A U.S. based exchange is most likely the best choice for U.S. residents although there appear to be some good exchanges in foreign countries.  Exchanges connect with a bank account or credit card and provide the ability to make a CC purchase.  Exchanges offer other features as well, like conversion to other CC.   Beware, transaction fees, trading costs and wide-price spreads can be costly.  Also, exchanges are not connected so the price listed at one exchange can vary dramatically from the price at another exchange, especially during periods of high volatility which have occurred frequently.

Reporting transactions is an important element of the CC market.  The Internal Revenue Service has already come out with notices on the subject referred to as “virtual currency”.  Participants in this market will want to keep good records and work with service providers that include accurate record keeping.

A quick internet search on U.S. cryptocurrency exchanges will provide more resources.  Some exchanges are more sophisticated than others.  One exchange that may be a good starting point for learning more about this service is Coinbase/GDAX but a full review of the competition should be completed before taking any action.

The website of some exchanges will operate on your phone.  Others are better from a tablet or computer.  Some exchanges offer a wallet but a different wallet provider from your exchange may be preferred.

Wallet

A wallet lets you take possession of the keys to your CC on a computer, phone or other personal device.  LOST OR STOLEN KEYS IS A BIG RISK FACTOR WITH CRYPTOCURRENCIES.  Some wallets may also allow you to convert to other types of CC inexpensively by using a feature like Shapeshift.  You don’t need a wallet right away or even at all but it can be nice to have for the reasons mentioned.

THE FOLLOWING INFORMATION IS INTENDED FOR EDUCATIONAL PURPOSES ONLY.  NO INVESTMENT RECOMMENDATIONS ARE BEING MADE.  CRYPTOCURRENCIES ARE HIGHLY SPECULATIVE.  INVESTING INVOLVES RISK, INCLUDING THE TOTAL LOSS OF CAPITAL INVESTED.

Cryptocurrencies

There are a lot of CC and the market is likely to change dramatically over time.  Below is a list of some of the more successful CC at this time and may be worth watching.  To keep track of CC winners and losers, individuals may want to pay attention to market cap, trading volume and price movements in addition to the subjects mentioned above.  The list below will likely change dramatically overtime but here are some of the leading CC at present.

  • BTC – BITCOIN
  • ETH – ETHEREUM
  • XRP – RIPPLE
  • BCH – BITCOIN CASH
  • LTC – LITECOIN
  • IOT – MIOTA
  • DASH – DASH
  • XMR – MONERO

It will be interesting to see how this market evolves.  There is a high likelihood CC will be with us for the foreseeable future; perhaps not in the present form.  The current environment is a little like the “DotCom” era of the 1990’s; the potential for massive change from the current market is high.

Posted in Central Banks, Credit Markets, Cryptocurrencies, Fundamentals, Government Policy, Innovation.

Brian Dightman