This concise introduction to the world of amazingly booming cryptocurrencies and free finance can save your life. Okay – at least money. On the web, you will find a lot of comprehensive materials on each topic, so here I will focus on what you will not read anywhere and on the basics that you need to know if you do not want to blend in with the crypto space. And what is so fascinating about this world?
The fact that absolutely free, without asking for permission from anyone and doing it with people from all over the world, without any restrictions, you can earn, pay, create your own crypto-tokens, purchase existing ones, trade them, exchange them, pawn, borrow, vote through them and even obtain from their possession the benefits assigned to them also in the real world.
And now the best part – many don’t need to invest to own ETH and enter the crypto world. It is enough for him to use the graphics cards of his computers. About this also in the entry.
1. Don’t be fooled by fairy tales about blockchain and cryptocurrency security.
First, it’s just software (plus hardware). Needless to say, how unreliable this environment is. One mistake, one successful vandal or hacker attack and… puff … everything can go away. And yes – even bitcoin’s blockchain has already been cracked once. It happened in the beginning, so few know about it, but … it happened. Other blockchains also scored – including ethereum! – various incidents which for some of their users resulted in the loss of their funds. And here no one will reach into the archives – as in banks – to rectify the situation.
All current tokens, including cryptocurrencies like BTC, monero, ETH, are stored in a centralized, publicly available database (blockchain) that is under constant attack. At no time do you have your cryptocurrencies (tokens) at home or in your wallet (the only exception is gløbal). What is called a „wallet” is merely your visualized way to access a given cryptosystem and store your passwords. There are no cryptocurrencies in it!
This should be borne in mind if someone wants to keep a significant part of their property in crypto.
2. In the crypto world, there is basically no uniqueness of names. Even on the same blockchain (platform, network, environment), different tokens may have the same name (e.g. a ring of tokens may have the name BTC and none of them may be THIS BTC).
What matters is the so-called address in a specific network and with all operations, transfers, exchanges or purchases, you must exercise due care. Check, check and check again if what is being done is correct, if it concerns the right network (even the same blockchain can have different networks!). Especially when you operate on decentralized exchanges (DEX) or other DeFi services. Otherwise, it may turn out that you have sent your ducats to the wrong address and you only have acorns worth nothing or have nothing at all. This problem does not apply to centralized exchanges (such as Binance), which themselves support the namespace and address of tokens and do not allow duplications, fakes, etc.
3. The so-called seed, usually a phrase of 12-24 words gives full access to the address (account) and funds contained in it. No matter what passwords are set on the wallet, even hardware, even offline. If someone knows the seed, they will always get full access to the account. End and period. Therefore, this is a phrase that:
a) you absolutely have to write down in a notebook, on a piece of paper, on the wall in the basement or chimney. Otherwise, you can stay with the knowledge that somewhere there are millions of your own, but you can’t access them because you forgot your password.
b) it must be protected so that no one will know it. Simple encryption of this phrase helps here, e.g. changing one word in the phrase to another. It’s just that you have to remember this change or write it down somewhere else without explaining what it is about.
Needless to say, saving it on any online device (computer, smartphone) is asking for trouble?
c) Never enter this phrase on any websites/programs if you are not sure that they are safe, that they will not be passed on to evil people. A common example is tricking people into an alleged win – a message comes that you have won some ETH / BTC, you just need to click the link and enter the seed to collect the win. And people are losing everything. Normal sites and software do not require this – it connects to a wallet (eg Metamask) and the user only approves access.
Of course, if for some reason you need to restore access to your funds (e.g. through a wallet on another device), you must use this seed phrase. But then you know what you are doing.
Of course, the cryptocurrency address can be freely given to anyone. But when you do it, you are already losing all the remnants of illusory anonymity – accounts are visible to the public, including their status and history of transactions on them.
4. Some systems (blockchains) are overloaded, such as ethereum. This poses a threat on many levels:
a) blockchain transactions can be completely frozen
b) transaction costs soar that some of them „get stuck in the queue” without coming to fruition for days or even months. Unfortunately, systems tend to process transactions with the highest fees first, which are affordable for bourgeois trading large sums.
c) If the contract is automatically terminated, their costs may „eat up” a significant or even the entire amount of the transaction (with small amounts and complicated contracts).
Therefore, if you want to play with low amounts, it is better to check if the blockchain (the one on which the token is) has low fees and adequate performance.
Since you already know the basic threats, now about what you need to enter this fascinating world.
Some systems (blockchains) can be accessed via websites such as waves.exange, others, such as ethereum and Solana (popular in DeFi), use multi-blockchain wallets such as Metamask or a hardware ledger, and others use self-developed software. Different wallets and services are installed over time, so you can go ahead and start with metamask. You can then even enter the phrase seed into any other wallet and access the same funds from it. You can read about the handling of these wallets, switching between networks, etc. on the web. There are tons of tutorials.
You can also start by registering on some centralized exchange (eg Binance). They are convenient, you just have to remember that such centralized exchanges have full access to user funds (like banks), so when they collapse or get hacked, they … puff … funds disappear. 🙁
Now let’s move on to getting crypto.
Most of them can be bought on the exchange, from a trusted friend, in exchange offices, bitomats, etc.
Some can be for free through the so-called airdrop, or free distribution of new cryptos.
Still others – eg the popular ETH can be „mined” by yourself using your computer’s graphics card. It is not free – it costs more electricity for the computer. It depends on the card’s power settings, but in most cases it is around 0,1-0,3 cents per hour of digging (10+ USD/ month).
On a fairly weak card (gtx1060 6GB), you can dig around 0.0213 ETH within a month (today it’s about 60 USD, you can see the current eth rate here) with an expense of ~ 10 USD on electricity.
A crypto mining program is e.g. t-rex minner. You have to set in .bat file your own cryptocurrency address (created, for example, in a metamask).
Then it fires and joins the mining pool, e.g. 2miners.
Before you start digging, it is worth reading about how to control and set the parameters of the card to have the right performance and not to overload it. If you have trouble setting the program, you can write to me.
You can also quickly check if their card is good at all. Just click here to download the program set by me, unpack it, run start.bat (for eth). If the card does not work (it has less than 5GB of RAM) then the start2.bat file. You can reward me for this post by giving him some work, which will make up a fraction of eth for me.
When you already have crypto (e.g. eth), you can go crazy after DeFi and squander it at will, e.g. by buying Tanks Project Token, which is a cryptocurrency game like play to earn, nomen-omen. 🙂
And there are many possibilities for squandering:
Centralized exchanges (CEX) such as Binance. Places where you can exchange and speculate on tokens recognized by these entities. Usually you will not find the less popular ones, game tokens, etc. These can be found on:
Decentralized exchanges (DEX) (e.g. waves.exange, uniswap. Here, no one has to ask for an exchange. If someone created their own token, can trade them thereby creating a pair with another token, e.g. BTC or ETH or some stablecoin (I will write about them lower).
To buy a token on them, select the pair you are interested in (e.g. if you want to buy TanksProject tokens, and if you have eth, you choose a TanksProject/ETH pair, if you have SOL, you choose a TanksProject/SOL pair, etc.
On such exchanges, you can earn commissions from trading by providing some pair of tokens with liquidity with your tokens. This is called yield farming. Attention! You could end up with tokens that were provided with liquidity or that you got from DEX or another platform.
Native platforms for the exchange of specific services/games/markets etc. Basically, you can enter them by purchasing their NFT token by paying for it by transfer, card or recognized cryptocurrency (e.g. BTC, ETH). But basically, you can only get out of it through cryptocurrencies because everyone is afraid of falling under the supervision of authorities (money laundering, etc., utter nonsense aimed only at surveillance of people).
They are often NFT galleries (eg Mintable, OpenSea, Rarible) or Earn To Play games (play and earn) with NFT and in-game items assigned to them (eg Tanks Project, Star Atlas, or those on Enjin Marketplace).
It is precisely the changes in the gaming industry, such as shifting the ownership aspect of the game by players – not creators – and the possibility of rewarding them for creating the environment in the game, that turns me on a lot. This is a breakthrough. Soon, no parent, no partner will be able to complain „You are just wasting your time playing!”
At pooltogether, you can farm some tokens in exchange for rewards accumulated from the commission. Theoretically, you only lose commissions that you would have had if you were doing yield farming yourself. But as in any farming, there is always the risk of ending up with acorns instead of your coconuts, which is nothing.
You can squander your coconuts on Initial Coin Offerings (ICO / IEO / IDO / IGO). ICOs are simply token offers that give you control, shares, revenue percentages, or other benefits in a variety of endeavors. Some of these tokens have become extremely valuable in relation to their original price.
IEOs are offers of this type, but immediately offered on a centralized exchange (eg Binance).
IDOs are offers of this type, the tokens of which immediately go to the decentralized exchange, which allows them to be traded immediately.
IGOs are offers of this type, the tokens of which are related to a certain game, give shares in it,% of revenues and/or other benefits in the game.
There are also gambling, betting and lotto platforms that do not take any commission from participants (as opposed to over 50% of the tribute as in our national lotto, etc.) or a small one and operate in a transparent manner – receipts, contracts and transactions are public and verifiable for everyone. Note: Internet censorship is active in Poland and many such sites are blocked. To bypass it, just change the DNS settings on the network card to eg DNSy google: 184.108.40.206, 220.127.116.11.
And stablecoins are tokens that maintain their exchange rate in relation to normal currencies (e.g. dollar, euro). They are, among others: Tether (USDT), Binance USD (BUSD), USD Coin (USDC), CUSD, CEUR. They allow you to stay in the cryptocurrency space without having to be exposed to unpredictable changes in cryptocurrency prices and returning to the world of normal finances and currencies. For example, if you think that all cryptos will start to depreciate, you can exchange them for stablecoins.
No more crypto sins come to mind yet. If you know any, share them in the comments.
The same is true if you have any questions – feel free to ask in the comment, and I will answer and complete the entry.
Greed in crypto is good because it drives the growth of this market and keeps it liquid.