Crypto for beginners

hey guys welcome to silicon valley girl today we're going to talk about crypto tesla and square are holding cryptocurrencies people are boasting online that they 100 x their investments that they became millionaires because they bought this particular coin couple months ago i can't really call myself an og i started buying bitcoin in 2017. this video is for informational purposes only and if you're like i want to get into this crypto game i want to start buying why is everyone talking about crypto i really want to get into it if you're interested watch this video up to the very end it consists of four parts first of all we're gonna talk about bitcoin and how cryptocurrencies work second we're gonna talk about why bitcoin is so controversial because a lot of people would tell you this is a scam this is a pyramid don't buy bitcoin we're gonna address all the issues so you can sit down with yourself and decide how risky you are how comfortable you are with everything i'm gonna talk about third we're gonna talk about my reasoning behind buying bitcoin and other currencies we're gonna talk about what i use to buy currencies and which apps i use to hold them and last but not the least i'm gonna share my portfolio allocation and reasoning behind it okay so what is bitcoin and cryptocurrencies there are hundreds of cryptocurrencies so you hear dodgecoin ethereum polkadot every day there is a new coin but bitcoin is a pioneer and it's by far the biggest cryptocurrency around and when i say the biggest we're talking about the market cap so if we take all the bitcoin and calculate what's the value of them that will be your market cap so today's market cap is around 900 billion dollars and if we look at top 10 coins by market cap there will be bitcoin ethereum finance coins solana cardano ripple polka dot dodge coin tara and avalanche now i rely on these top 10 in my investment strategy but we're going to talk about it closer to the end of the video now what is a cryptocurrency the world crypto literally means concealed or secret cryptocurrencies use cryptography to allow transactions that means that you don't need a bank you don't need a government you don't need any third party in the middle for transactions to go through and before crypto normally a currency would be issued by a government the supply will be controlled by the government but cryptocurrency takes the power away from government banks etc and it distributes the power among cryptocurrency holders now let's talk about ledger that holds everything together so bitcoin started back in 2009 and we can think about bitcoin as of this huge spreadsheet where every transaction is listed in a way that you can go online and see which wallet holds what which wallet sold bitcoin which wallet bought an nft every single transaction is transparent you can't really know the names of people who are transacting because their wallet is a set of numbers and letters it is not in any way related to their first and last name it's just this random set of characters and last but not the least cryptocurrency is decentralized and what this means is that every person in the world can have a copy of this master spreadsheet on their computer and so with bitcoin there are millions of people who have this spreadsheet on their computers and there is special software that's constantly checking whether their spreadsheet is up to date and it's the same as every other copy of a spreadsheet on the network think of it as google spreadsheet which is updated in real life but with google spreadsheet google actually owns it and google can say you know what i decided to discontinue google spreadsheets and i delete all of your data by buy well i don't know if they can technically do that but they own your data they control it with bitcoin ownership is decentralized so there is no person or government that could come and say you know there is no bitcoin anymore we cancel it they can only prohibit it within their own country but they cannot delete the system like this is what decentralization means there is no one in control of course there are big huge players that are holding a huge amount of bitcoin and they can influence the price by selling huge amounts in a way that it is built it is impossible to hack bitcoin because millions of people all over the world are helping maintain it now let's talk about why crypto and bitcoin is so controversial now theoretically the whole system is decentralized and maintained by millions of nodes all over the world in practice there are these things called crypto exchanges think of them like new york stock exchange london stock exchange where you can buy and sell crypto and this is coinbase finance robinhood but i have this experience with one of the crypto exchanges where you think it's decentralized and nobody controls it but then i tried to send one ethereum to my husband and i got blocked for 10 days because the crypto exchange thought that my transaction was suspicious so in reality my experience is not really different as if i was making a wire from a bank so i was blocked for 10 days and i wanted to him to invest my ethereum in this deal that he was a part of and so i couldn't participate in that deal and i felt a little that i was back in the old world you know where somebody else controls my money there are also some security issues with accounts being stolen if you didn't have your two-factor authenticator or you stored your seed phrase somewhere online by the way a seed phrase is a series of words that gives you access to your wallet so as long as you have the seed phrase you have access to your wallet think of it as login and password in the old world but if somebody gets your seed phrase that basically means that you lost all your crypto and another thing with these exchanges that you need to remember is that you don't really own crypto there because an exchange is not your wallet so what my experience has been if you bought a bitcoin in an app that is just an exchange you need to transfer it to your wallet and again your wallet is a set of numbers and they can say oh my god this transaction is suspicious block your account so these platforms are kind of giving you access to the certain amount but it's not like you're necessarily holding it like for me the good example be like you're buying gold sometimes we would go online and buy an etf for gold right you can either buy an etf which means you're kind of speculating if it's price goes up then you have more money in gold you can also buy a real bar of gold and it's here and you can make earrings out of it right so when we think about buying bitcoin on crypto exchange its price goes up and down but if you really want to use it in metaverse buy things you need to transfer it to your wallet and there are fees associated with that so if you want to physically own your crypto and have control over it there is another way to store crypto crypto wallet one of the 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