My Crypto Book
01
Basic concepts
Cryptocurrencies, cryptocurrencies or cryptoassets are a type of alternative currency or digital currency with decentralized control, that is, they do not depend on government entities or banks. Control of each currency works through a decentralized database, called the 'Block Chain', which serves as a database of public financial transactions.
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Cryptocurrencies are systems that allow secure online payments, also called 'Virtual Tokens', and are represented by internal accounting entries in the system.
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'Crypto' refers to the various encryption algorithms and cryptographic techniques that protect secure online payments, such as elliptic curve encryption or public/private key pairs.
All cryptocurrencies belong to a global ecosystem of decentralized finance, also called 'DeFi'.
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The first cryptocurrency to be created was Bitcoin in 2009 by pseudonymous developer Satoshi Nakamoto. Later, others have appeared such as Ethereum, Ripple, Cardano,..., until today there are more than 10,000. Bitcoin is therefore a decentralized digital currency, encrypted in the P2P (Peer to Peer) format, which is made up of a series of complex computer-generated codes.
02
Important cryptocurrencies
BITCOIN (BTC)
Bitcoin (BTC) is known as the first open-source, peer-to-peer digital cryptocurrency. Bitcoin does not have any centralized servers used for its issuance, transactions and storage as it uses a distributed network public database technology called blockchain, which requires an electronic signature and is backed by a proof-of-work protocol to provide security. and legitimacy of monetary transactions. Bitcoin issuance is carried out by users with mining capabilities and is limited to 21 million coins.
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ETHEREUM (ETH)
Ethereum is a decentralized computing platform. It is a large computer spread across multiple computers at the same time and works simultaneously. It is a 2nd generation blockchain and unlike Bitcoin, its network is programmable, which means it has many more functionalities. It is the second most important cryptocurrency.
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CARDANO (ADA)
Cryptocurrency launched in 2017 whose native token is ADA, Cardano is distinguished from the rest of the blockchains in that it had a more premeditated, rigorous and scientific origin and is a 3rd generation blockchain. It also differs in that it seeks to solve problems that other cryptocurrencies present regarding to security, scalability and decentralization. Cardano is distinguished by using mathematical principles in its consensus mechanism and a unique multi-layer architecture, which makes it stand out from other cryptocurrencies.
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RIPPLE (XRP)
Cryptocurrency that according to experts is the successor to Bitcoin since it was created by its former developers with the aim of improving its features. Ripple's goal is to connect banks, payment providers, and digital asset exchanges, enabling faster global payments. Like Bitcoin, it is a completely secure and encrypted system whose transaction information is public but payment information is not. It is a confidential system where the sender and the receiver are the only ones who have said information and the code that decrypts it.
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POLKADOT (DOT)
Polkadot is an open source protocol developed to be accessible to everyone with the goal of enabling the evolution of blockchain technology. Its objective is to introduce interoperability between different blockchains, allowing them to exchange data between them and thus be able to develop more powerful services and applications. The native token of the Polkadot network is DOT.
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SOLANA (SUN)
Solana has created a high-performance network that is fast and capable of executing a high level of operations per second. The difference between solana is its operation verification protocol known as 'Proof of History', which is not a consensus mechanism like the 'Proof of Work' used by other cryptocurrencies, but it is a way to improve the time spent on confirmation of the order of transactions. The native token is SOL and works as a utility token.
UNISWAP (UNI)
The Uniswap project is a DEX or decentralized exchange protocol that works based on the Ethereum network and an active agent for the existence of an automated liquidity protocol (AMM). The objective of Uniswap is to allow decentralized 'Swaps' (exchanges) from one asset to another. It has a wide offer of exchangeable tokens (anything ERC-20), it is a low commission system and it is a non-profit organization. The native token is the UNI.
TETHER (USDT)
Tether is a stablecoin or stable currency, although at the same time it is also a cryptocurrency. What differentiates this digital currency from other currencies, such as bitcoin or ethereum, is that its mission is to replicate the price of the dollar, this means that one USDT, the name of the token, will always be equivalent to one dollar. It is a digital currency that is designed to be used massively or perhaps it is more similar to what we know as normal money or Fiat money, that is, it is not a currency designed for investment but for use.
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SHIBA INU (SHIB)
Shiba Inu is one of the digital assets most used by users in the crypto community, but it has a curiosity: it was born from a meme.
The Shiba Inu stopped being just one of the most famous breeds that exist in Japan and became the face of a token that is part of an ecosystem that demonstrates life beyond Bitcoin and Ethereum. It was founded in 2020.
The creation of this new meme token was the idea of the anonymous “Ryoshi”, who in August 2020, created the "smart contract ERC-20" that would give life to Shiba.
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To buy all these coins in gold or silver and many others, you can go directly to the online store from here.
03
Cold wallet
A 'Cold wallet' is one that allows you to store cryptocurrencies offline or offline without an internet connection, which makes them the safest wallets when it comes to receiving external attacks. They are also known as cold wallets, offline wallets or wallets with an extra layer of security without a direct connection to the network.
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A 'Hot wallet' is one that is always online. Their main characteristic is that they can be accessed from any device with internet access, which is why they are more exposed to hackers. The private keys are stored on the wallet's online servers, while the owner of that online wallet only has the username and password of his or her account created in a mobile application, for example. If a hacker manages to access the wallet's servers, he can steal your information and your cryptocurrencies stored in the hot wallet.
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With My Crypto Box we provide you with a 'Cold wallet' that is the first non-electronic hardware cold wallet in the world. Many cybersecurity experts have praised this digital wallet that uses a 2-factor key generation (2FKG) process, since to access the funds in the wallet you need both the private key and the passphrase of the corresponding wallet, To do this you need the physical metal card that we offer you, in silver and gold.
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Click on the photo on the left to access the Ballet website and learn more about the digital wallet.
In order to acquire this wallet you must purchase the Crypto Pack in the Silver or Gold version that we offer in the online store.
04
First steps to investing safely
I recommend you follow the following steps:
1.-Acquire general knowledge about blockchain and cryptocurrencies: their basic operation, how a transaction occurs, where cryptocurrencies are stored and in general understand the entire ecosystem related to the blockchain.
2.-Perform Technical Analysis: it will allow you to analyze a graph, know what phase of the market we are in and look for the most precise entry points possible. Technical analysis in trading is a method used to analyze the price movements of a financial asset through the use of graphs and indicators. Its use allows us to evaluate investments, identify trading opportunities and manage the risk of our operations. The main objective of technical analysis is to analyze the price behavior in the past to predict what may happen in the future, in this way we will look for situations in which we can estimate where the price is most likely to move, we will take advantage of such a situation and generate benefits. (Click on photo on the right)
3.-Perform Fundamental Analysis: when we want to invest in a listed company we analyze its strengths, weaknesses, business model, certain ratios. To invest in cryptocurrencies we have to do something similar so we have to familiarize ourselves with certain ratios, metrics and factors to analyze in any project in which we are interested.
(Click on the photo on the right to see opinion and analysis from crypto asset experts)
4.-You must be informed about the latest news, both those directly related to cryptocurrencies and others at a global level that may also influence the price.
5.-Focus on long-term investments: A very common mistake at the beginning is to focus on short-term operations, it is better to focus on the medium-long term if you want to make money with cryptocurrencies. The idea is to try to take profits in the big phases of rises or bull cycles and stay away from the periods of a lot of noise and uncertainty. 80 or 90% of the profits occur in these bullish cycles and the rest of the time it is advisable to preserve capital, hold on and not sell.
6.-Do not invest money that you are not willing to lose: This is the most common mistake that occurs. Even if you have an investment plan, adequate risk management, and were able to manage your positions correctly, there are still other risks inherent to investing in cryptocurrencies. Therefore, as a starting point when investing in Bitcoin, Etherum, Ripple, or any other cryptocurrency is that you only invest money that you are willing to lose. It should be money that you do not need in your daily life so that if you lose it it will not affect your life.
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7.-Watch your emotions: Very often, when a cryptocurrency in which we want to invest begins to increase its price quickly, we are tempted to enter for fear of being left out and not making money. We must avoid buying by chasing the price in this way since many times at the moment of buying, the price will begin to correct and we will be trapped in losses. The way to avoid being carried away by emotions is to create an investment plan and follow it. Let's not enter when the market is extended when we should have done so sooner according to our investment plan.
The cryptocurrency market is very volatile and unpredictable, so to begin with we can start with strategies such as DCA (Dollar Cost Averaging), in which we make purchases spaced over time, this way we will not capture the bottom of the market, but we will achieve acceptable returns in the medium term.
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IMPORTANT NOTE
'My Crypto Book' has been designed together with 'My Crypto Box' as an aid and guide for the small investor in digital assets, in no case should this text be considered a basic rule to obtain short-term benefits. The decisions made by the investor will always be at his own risk.
