Disclaimer: This is not financial advice. I am not a financial advisor. What follows is my personal, subjective, biased opinion.
Let’s face it: Money is what got you here. You might have bumped into the word “Bitcoin” here and there, but quickly forgot it again or even dismissed it as yet another internet fad. Until last year, when it was all over the news.
On January 1st, 2017, Bitcoin’s price was sitting just under $1,000. Between now and then, you’ve heard at least one of its ridiculous price levels. $5,000, $10,000, even $20,000 per coin. And now you’re intrigued. Because who wouldn’t want money coming out the wazoo?
You still think the whole thing stinks, but you’re too curious to not learn more about it. Newly minted Bitcoin millionaires pop up all the time and slowly, the fear of missing out creeps in. Your gut is damn right in sending you all those feelings. Both sides. The curiosity, the skepticism, and the fear of missing the boat.
I’ve gone through all of them, and it is this dichotomy of feelings that made me write this Bitcoin for Beginners series. The goal is to resolve those feelings and discover what, if anything, makes blockchain interesting.
Bitcoin for Beginners
1. Why Should You Care About Bitcoin?
2. 7 Ways Bitcoin Will Make You Rethink Money Forever
3. How Does Bitcoin Work?
4. Why Is Everyone Investing in Bitcoin?
5. Why Market Predictions Are Almost Always Wrong
6. Where Is Bitcoin in the History of the World’s Greatest Bubbles?
7. 7 Big Obstacles to Mass Adoption of Blockchain Technology
8. 3 Potential Paths Cryptocurrency Regulations Could Take (and Which One’s Most Likely)
9. The 15 Best Resources To Learn More About Bitcoin
10. Granny’s Bitcoin Cheat Sheet
Let’s start with the question that burns the biggest hole in your mind.
Can Bitcoin Make Me Rich?
To be a pioneer often comes with a reward, but never has the reward been this big, this fast. When it started 9 years ago, Bitcoin was nothing but a geek show, people experimenting with their own ideas of what money should be. Today, Bitcoin may still not be the world’s premier currency, but these experiments have more than worked out regardless.
For Peter Saddington, for example. In 2011, he bought Bitcoin for $2.52 a piece. Six years later, he decided someone had to satisfy the Lambo meme culture and actually buy one with crypto. So he did. For about 45 BTC, the equivalent of $115 of his 2011 investment, he bought a Lamborghini Huracán from a dealer who chose to accept the cryptocurrency for the purchase.
The craziest part of this story is that it’s not unique. There are thousands of people whose name you’ve never heard, but whose lives have completely changed — fast cars or not — because they were brave enough to be a part of a new technological movement early on.
Beware, however. It’s easy to get frustrated you’re not like Peter, but there’s also a lot of inherent bias in his story. First, he’s a survivor, someone who’s held on long enough to win big. Those who didn’t don’t share their stories on Youtube. Second, he still had to wait for six years for his returns. Of course that’s nowhere near as long as we’re used to in other, more traditional asset classes, but Amazon’s stock also increased tenfold in value in the same period of time. He took an enormous risk, remained patient, and, as he admits, got lucky.
But the choice whether his story serves as inspiration or envy is ours. And while the money is what everyone talks about, investing in Bitcoin is not the only reason why you should care about cryptocurrencies. It’s just a brilliant way to drag you down the rabbit hole of this new world. As one Reddit user put it:
“It’s the best hook of all time. Come for the free money. Stay for the financial revolution.”
The #1 Tech Trend To Keep Up With
The world is changing faster than ever before. It’s impossible to follow all innovations, ideas and developments. But some are more important than others.
Take the internet, for example. Had you stayed at the edge of its development from 1993 until today, you could have benefitted even more than you already do. Plus, it has and continues to fundamentally change how the world works, which is why it’s important to understand it. I was too young back then, but this time, I got the memo.
Blockchain, the underlying technology of Bitcoin and most cryptocurrencies, is the new internet. And right now it’s 1993.
Blockchain is a specific structure for managing networks and transactions within them. It eliminates third parties like banks, real estate agents, and governments, and thus enables people to transfer money, goods and even authority from one person to another. No permission and nobody’s help needed. It’s just you and who you choose to interact with.
Blockchain technology has the potential to revolutionize how humans trade. How we spend. How we vote. How we connect, live, and interact. Sound familiar? It’s the dot-com boom reloaded. Same hype, same potential, and probably the same bust before mass adoption.
While Bitcoin is the first and most prominent representative of this new technology, it’s far from the only one. There are already over 1,600 different cryptocurrencies and counting. Each with a different vision, purpose and team. Some are good, some are bad, some will crash, some were never meant to be. But the people behind all of them have understood revolutionizing our financial system is only one of many ways blockchain could change our lives.
Almost all industries have potential applications:
- Cyber security.
- Supply chain management.
- Forecasting & crowd predictions.
- Retail.
- Internet of Things.
- Insurance.
- Transportation.
- Elections.
- Government administration.
- Charity.
- Cloud computing.
- Social aids.
- Healthcare.
- Energy.
- Real estate.
- Telecommunication.
- Music and video streaming.
- Gaming.
- Events.
- Legal services.
- Loans.
The early internet was clunky, complex and hard to use. The current state of blockchain is pretty much the same. It’s slow, requires lots of know-how, and doesn’t scale. But that doesn’t mean it’s not equally as powerful. It will disrupt entire business sectors and, like the internet, create new ones we never could have imagined.
That’s the real reason you should care about Bitcoin. It just so happens that those who care early on sometimes also end up with Lambos.
