What is Blockchain + Cryptocurrency All About, How it is important to You.

This week I have had numerous people ask me “What is the Blockchain?” and “Should I be investing in cryptocurrencies?”

Then My Wife Asked Me the Same Questions!

After I began explaining it to her she was off in la-la land after about 10 seconds and I could tell that she just wrote it off as something she would “just never get.”

I am here for you today, to EXPLAIN this technology in a way you WILL Understand.

Lets get started.

First some quick history:

Typically, digital information is stored on servers (computers owned by individuals/organizations) that have databases (storage software) on them.

bitcoinBlockchain technology was first created initially by a group called ‘Pseudonym’ led by Satoshi Nakamoto.  The concept is that instead of Copying Data, digital info should be able to be Distributed to All, and updated continuously! Then they focused on a way to monetize it (more later on cryptocurrency).

Let me give you an examples in order to understand the Blockchain through one of my least favorite subjects…. Homework:

Ever had a group project?  Either at school or work.  You used to have to send a document from person to person, so they could add their “share” of the work that had to be done before you had a completed project?  Ya that is the old way of doing things, where the most up to date document was only ever in one place, and one persons computer at a time!

With Google Docs though, (as many of you know) the document can be edited by everyone at the same time, blockchain chillinand is updated as you edit, in a DISTRIBUTED and DECENTRALIZED (managed by everyone) way.  Blockchain really is that simple.  If you can understand Google Docs, you can understand the Blockchain.

Sure Google Docs, whatever…I see people online making MILLIONS with this technology though.  How does that work?

Ya, some people are making millions mining bitcoin.  They have also invested a ton of money into hardware, and their electric bill ranges from higher than normal to astronomical.

There are two ways to make money in crypto currency

  1. Invest in it
    1. There are hundreds of crypto-currencies, first you must choose one
      1. Bitcoin being the first (click the links for prices on the currencies)
      2. Ethereum being number two (uses a different type of Blockchain)
      3. Hundreds more have been created with different features and reasons why they believe that, “This will be the crypto-currency of the future!”
    2. You must have a wallet to keep it in
      1. Coinbase is the quick way to get an online wallet and purchase cryptocurrency by linking your CC or bank account
        1. They have been hacked
        2. Back to keeping data with a single organization (set of servers)
        3. Fees? Yup to convert currencies
      2. Create/Purchase a Cold Wallet or offline storage for them.
        1. You can use a USB device
        2. Purchase a more dedicated devices like TREZOR
      3. Tutorial for how to use (add/use) cryptocurrency in cold wallet
  2. The other way to make money in crypto-currencies is to farm it.
    1. Create a Mining Rigtypes of cryto currency miners (2)
      1. There are tons of different options for mining rigs, and plenty of tutorials online.  My brother is building one as I type I believe.
      2. This entails purchasing GPU’s or ASIC’s (dedicated computer, Depending on the type of currency you want to mine), building a dedicated computer, plugging it in, editing the Bios, overclocking your device, monitoring it, connecting to a mining pool (group of people mining together and splitting profits), and then paying your higher than normal electric bill.
      3. A starting setup starts at $2500-$3000 dollars, this will get you 4-6 GPU setup, and depending on what you are mining 150-450 a month-ish.  I will let you do the Return on Investment math on that one.
      4. The more you spend, the more equipment you have, the more you make.  Check out this picture for different setups that have been created.

 

Where Does the money/Cryptocurrency come from though??

Great question.

blockchain cityCryptocurrencies are digital representations of money (similar to what your bank does –> anyone use online banking?)

Except you can cut out the middleman…THE BANK!  These big banks hate cryptocurrencies, and for a good reason, it is their competition. AND it could someday (very long someday maybe) put them out of business…That’s big money

Anyways.  Algorithms are set in place, and distributed to a computer network (you and me downloading some software, mining, and becoming shareholders within a certain cryptocurrency)  Then we throw computing power at the algorithm, and when a computer (or computer pool) cracks an algorithm it records this ‘block’ to a public, distributed ledger that everyone has.  Thus the Blockchain just got one block added to it, and a miner or pool of cryptocurrency miners were just paid.

 

There you have it.  The quick and dirty on Blockchain and Cryptocurrencies.

But Why is it important for me?

Because…

Blockchain is creating the Web 3.0

Many still think that the Web 3.0 is social media, and the sharing of everything with hashtags….

Nope.  Its Blockchain.

why? How? Where?

Entrepreneurs. Hard Work. Why?

That’s the most important part!

Because Blockchain is a SECURE system because we work together, without a company or government being the higher authority to control it.  Trust is created between a network of people…Individuals coming together to make something more powerful than any of us could achieve on our own.

 

Different implementations of Blockchains are still being created, and this is just the beginning.

If you are looking to learn more

  • Look into Smart Contracts
  • Invest in some cryptocurrency
  • Talk to someone who works in the Blockchain industry like Bridget Slevin who is passionate about changing the world with Blockchain.
  • Join the movement through Mining a cryptocurrency
  • Or just wait and watch (or talk to my wife about it, I THINK she gets it now 😉 )

Remember there will always be doubters, that is okay, it is healthy for business!

Just like Balmer laughed at the iPhone for not having buttons (hilarious btw, watch the video at that link), JPMorgan’s CEO is laughing at Cryptocurrencies!

I just don’t think some people understand it yet….just wait for it!

Oh ya, and keep an eye out here @ Cyberincision.com for new developments in Cyber Security through the use of Blockchain as well!

 

Cyber Incision Out.

p.s. Would love to get your feedback/questions below, Thanks!

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