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A Guide to the Top Ten Coins for Beginners

30/1/2018

0 Comments

 
With over 1400 coins to pick from, how can you tell if one is worth investing in?  Lets start by looking at the top ten coins.
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As at January 2018, Coin Market Cap listed the top ten crypto currencies (by Market Cap) are Bitcoin, Ethereum, Ripple, Bitcoin Cash, Cardano, NEO, Stellar, Litecoin, EOS and NEM. 
​
The Market Cap suggests that these coins are the most popular, so lets attempt to find out why.
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To help describe these coins, so that they can be compared as equally as possible, I have used symbols to represent some of the unchangeable aspects of a crypto.
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Ticker: The ticker symbol.  This is usually 3 Letters.  Most cryptos have one symbol, but some (like Bitcoin) have two.  It is worth noting that symbols are not unique, and are not issued or governed by a single body, so double-ups are frequent.

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Launch:  This is the date the crypto was announced as launching or even existing.  Most cryptos are not in any usable form at this point.

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Release:  This is the date the usable or beta form of the crypto was released.

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Purpose:  This is one word that very generally describes the point of the cryptos existence.  Whether a currency, platform for other apps or a payment system, most cryptos can be boiled down to one word.

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Origins:  Where did the crypto originate?  Cryptos are started all over the world.  Sometimes they don't originate in a physical place, but in a virtual place (ie a forum or on social media).

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Token:  Is this crypto a token?  ie does it rely on another crypto to work?  The most common are the Ethereum tokens, ERC-20.

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Open Source:  Is this crypto open source?  Can anyone view the code?  Not all cryptos are open source, but the general consensus is that it is better if the code can be reviewed by independent sources.

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Forked:  Is the code base the same as another crypto?  On occasion the developers of a crypto struggle to agree on particular change to a crypto, so they agree to each take the code they have and develop it in their own way, creating two versions of the software.  This is called a fork. 

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Supply:  How many coins (or tokens) will be created in total.  This number can give us an idea of how common or scarce the coins might be.

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Mineable:  Coins that are mine-able allow members of the public to participate in the distribution of the crypto making the coin decentralised.  If the coin is mine-able, we note the algorithm type, such as SHA-256 or SCRYPT.

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Stake:  If the coin can be staked, we note the consensus type.  Coins that can be staked allow members of the public to participate in securing the network, making the coin decentralised.

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Currency:  Does the crypto have a specific name for its currency?  This applies especially to platforms, such as Ethereum, that calls its internal currency Ether.  Sometimes (but not always) when you purchase the crypto (through an exchange etc) you are purchasing the currency token, as opposed to a share in the business (as you would when purchasing stocks).  In the case of Ethereum, you purchase Ether, not Ethereum.  In the case of NEO, you are purchasing a voting share, but GAS (the currency token for NEO) is purchased separately.

Now that you know how the shorthand model works, lets look at each crypto individually.
I have given a short description of the reason the crypto was created in the first place, and what problem it is attempting to solve.  I also describe how the crypto is currently being used, which is not always in its initial intended way. 
Lastly, I look into its intrinsic value to investors.  In order for a crypto to have long term value, it requires a financial eco-system.  The eco-system requires interaction between the developers and the community who will ultimately use the crypto. This means there needs to be a way for the developers to earn income (so they can continue to develop), a way for the community to earn crypto (so the community has an incentive to be part of the project), a reason to spend the crypto, and an easy way for the crypto to be spent. If the crypto can't provide this eco-system then the crypto may struggle to survive long term.
Bitcoin
Bitcoin
Bitcoin
Creation
Bitcoin is the first cryptocurrency invented by Satoshi Nakamoto, an anonymous developer who desired a currency that was not controlled by a government or other central body. 
Use Case 
Bitcoin is currently in general use as a currency, and is famous for being used in illegal transactions and money laundering. Bitcoin is also used as a store of value and as an exchange coin against other cryptos.
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Value
Developers earn by collecting fees from each transaction.
The community earns by selling goods and services in exchange for Bitcoin and by mining Bitcoin.
The community s
pends Bitcoin by purchasing goods and services using Bitcoin and by using the Bitcoin network 
(in transaction fees).

Website:
Block Explorer:
Whitepaper:
Github Code:
​Wikipedia:
https://bitcoin.org/en/
https://blockchain.info/
https://bitcoin.org/bitcoin.pdf
https://github.com/bitcoin/bitcoin

https://en.wikipedia.org/wiki/Bitcoin​
Ethereum
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Creation
Ethereum is a platform style crypto created by Vitalik Buterin that has the ability to execute Smart Contracts.  Smart contracts are additional scripts that are written specifically to run on the ethereum platform (as an operating system), which have real-world applications outside a currency. 
Use Case
​Ethereum is currently in general use as a currency, as a store of value, as an exchange coin against other cryptos and as an operating system for its dApps (an application run on a decentralised platform).   See here for a full list of applcations built on the Ethereum platform.
Ethereums applications use an ERC20 token.  This is a currency that the application can use as its internal currency (to buy and sell the services of the application), which piggyback on the Ethereum network, hosted by Ethereum addresses and sent by Ethereum transactions.
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Value
Developers earn by collecting fees from each transaction and from d'App transaction fees.
The c
ommunity earns by selling goods and services in exchange for Ethereum and by mining Ethereum.
The community s
pends by purchasing goods and services using Ethereum, by using the Ethereum network and by creating a d'App that uses the Ethereum network to process transactions.

Website:
Block Explorer:
Whitepaper:
Github Code:
​Wikipedia:
https://ethereum.org/
https://etherscan.io/
https://github.com/ethereum/wiki/wiki/White-Paper
https://github.com/ethereum
https://en.wikipedia.org/wiki/Ethereum
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Creation
Ripple is a payment system focusing on the banking system, managed by a network of independent validating servers that could belong to anyone, including banks or market makers.
Use Case
Ripple allows for payments between customers, corporations or banks regardless of location or currency, creating a point-to-point and transparent transfer in which banks do not have to pay corresponding bank fees.  ​Users make payments between each other in either fiat currencies or in Ripple's currency (XRP). 
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Value
Developers earn by collecting (optional) fees from some transactions and from coins kept in escrow (60% of all coins in circulation)
Banks/Corporations can't earn ripple, but must be a validator of the network to participate in the network. 

Website:
Block Explorer:
Whitepaper:
Github Code:
​Wikipedia:
​https://ripple.com/
https://bithomp.com/explorer/
https://ripple.com/files/ripple_solutions_guide.pdf
https://github.com/ripple/rippled
https://en.wikipedia.org/wiki/Ripple_(payment_protocol)
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Creation
Bitcoin Cash is a forked version of bitcoin.  This fork was created when developers disagreed on how to increase the processing times of a transaction.  One set of developers chose to develop the code in a particular way that they believed would address the issue, and called this version of the code Bitcoin Cash.   You can read more details about the debate here.
Use Case
Bitcoin Cash is actively used as a currency.
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Value
Developers earn by collecting fees from each transaction.
The community earns by selling goods and services in exchange for BitcoinCash and by mining Bitcoin.
The community s
pends BitcoinCash by purchasing goods and services using BitcoinCash and by using the BitcoinCash network (in transaction fees).

Website:
Block Explorer:
Whitepaper:
Github Code:


​
​Wikipedia:
www.bitcoincash.org/
https://blockdozer.com/insight/
n/a.  The same as Bitcoin.
https://github.com/Bitcoin-ABC/bitcoin-abc
https://github.com/bitcoinclassic/bitcoinclassic
https://github.com/bitcoinxt/bitcoinxt
https://github.com/BitcoinUnlimited/BitcoinUnlimited
https://en.wikipedia.org/wiki/Bitcoin_Cash
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Creation
Cardano is a currency and a platform being built to run smart contracts and decentralized applications.   Cardano is being developed from a scientific philosophy and is designed by a team of academics and engineers.  Cardano chooses to allow itself to be continuously peer reviewed, allowing experts outside the project to voice their opinion and suggest changes on aspects of the project. 
Use Case
Still in  production, Cardano is creating a Cardano debit card, with an accompanying app to use is everday life.  The platform use of the Cardano network is also still in production.
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​Value
​
Developers earn by collecting fees from each transaction and from d'App transaction fees.
The community earns by selling goods and services in exchange for Cardano and by staking Cardano.
The community s
pends by purchasing goods and services using Cardano, by using the Cardano network and by creating a d'App that uses the Cardano network to process transactions.

Website:
Block Explorer:
Whitepaper:
Github Code:
​Wikipedia:
https://www.cardanohub.org/en/home/
https://cardanoexplorer.com/
https://www.cardanohub.org/en/academic-papers/
​https://github.com/input-output-hk/cardano-sl
https://en.wikipedia.org/wiki/Cardano_(cryptocurrency)

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Creation
Neo is a platform and cryptocurrency which enables the development of digital assets, smart contracts  and decentralised applications.
Use Case
Neo already has a wide range of applications that use the Neo platform. See here for their full list of advertised apps.
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Value
NEO holders get voting rights in the NEO ecosystem as well as rights to dividends in the form of GAS when staked.   GAS is used as an internal currency to deploy and run smart contracts.  Both NEO and GAS can be purchased on the open market.

Website:
Block Explorer:
Whitepaper:
​
Github Code:
​Wikipedia:
https://neo.org/
https://neotracker.io/
https://github.com/neo-project/docs/blob/master/en-us/sc/white-paper.md
https://github.com/neo-project
https://en.wikipedia.org/wiki/NEO_(cryptocurrency)
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Creation
Stellar is a payment system focusing on consumer payment systems and banking, managed by a network of independent validating servers that could belong to anyone, including banks or market makers.
Use Case
Stellar allows parties to send money internationally for a fraction of a cent, regardless of the currency involved.  It also provides a platform for mobile payment apps to connect with each other.  Because the transaction has such a low cost companies can incorporate micro-payments into their systems.
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Value
The value of a lumen is generated through each transaction which requires a fee of 0.00001 lumen.  Lumens act as an additional security to the network, preventing wide scale DoS attacks because of the financial overhead to do so.
In addition, the network requires all accounts to hold a minimum balance of 1 lumen, ensuring the integrity of each user on the network

Website:
Block Explorer:
Whitepaper:
​
Github Code:
​Wikipedia:
https://www.stellar.org/
https://stellarchain.io/
https://www.stellar.org/papers/stellar-consensus-protocol.pdf
https://github.com/stellar
https://en.wikipedia.org/wiki/Stellar_(payment_network)
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Creation
A forked version of Bitcoin, Litecoin focuses on faster transaction times than bitcoin.
Use Case
Litecoin is used actively for general currency transactions.
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​Value
​
Developers earn by collecting fees from each transaction.
The community earns by selling goods and services in exchange for Litecoin and by mining Litecoin.
The community s
pends Litecoin by purchasing goods and services using
Litecoin and by using the Litecoin network (in transaction fees).

Website:
Block Explorer:
Whitepaper:
Github Code:
​Wikipedia:
https://litecoin.org/
http://explorer.litecoin.net/chain/Litecoin
n/a.  The same as Bitcoin.
https://github.com/litecoin-project/litecoin
https://en.wikipedia.org/wiki/Litecoin
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Creation
EOS is planned to be a platform, built on top of the Ethereum platform, that aims to shorten transaction times and reduce the end-user need to power the Ethereum network themselves when interacting with an application.   EOS aims to allow applications to determine how much, if anything, their users need to pay to use the application.  
Use Case
EOS is in the ICO phase until June 2018, at which time they will launch the platform.
Value
EOS will be required by applications (dApps) which will provide bandwidth and storage on the blockchain in proportion to their total stake. EOS holders will also be able to cast votes and participate in the governance of the blockchain.
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Value
​​It is currently unclear how the EOS developers themselves will make an income.  there is a suggestion that after the ICO block.one (the company who has created EOS) will become a d'App developer and make income in that way.  
The community can earn by staking EOS and renting EOS stakes to d'App developers.  As the use amount of resources available to your dApp is proportional to the number of EOS you hold, then scarcity of EOS will make EOS a suitable condidate for rentals. 
The community does not have a way to directly spend EOS as it is an asset to be used in exchange for bandwidth on the network.

Website:
Block Explorer:
Whitepaper:
​
Github Code:
​Wikipedia:
https://eos.io/
https://etherscan.io/token/EOS
https://github.com/EOSIO/Documentation/blob/master/TechnicalWhitePaper.md
https://github.com/EOSIO/
https://en.wikipedia.org/wiki/EOS_(cryptocurrency)


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Creation
NEM is a general use currency built using the Proof of Importance algorithm which
new code base that was written entirely in Java. It uses the POI (proof-of-importance) algorithm, similar to Proof of Stake, where harvesters (stakers) are given an importance score, and as people’s score grows higher, they will have a better chance of earning the rewards.
Use Case
NEM is available for apps or businesses  to use the currency in a variety of ways such as creating a currency, mobile payment systems, Escrow services, loyalty point systems, supply chain management, registries, voting and crowd funding.
Value
Earn :The value of a NEM is generated by the Proof of Importance algorithm, where harvesters earn NEM as their reward.
​Spend:  
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Value
​​NEM developers earn by collecting fees from each transaction.
The community earns by vesting (staking) NEM and earning a vesting reward.  
The community spends NEM by using the applications that use the NEM blockchain to operate (
in transaction fees).

Website:
Block Explorer:

Whitepaper:
Github Code:
​
​Wikipedia:
https://nem.io/
http://chain.nem.ninja/#/blocks/0
https://nodeexplorer.com/
https://nem.io/wp-content/themes/nem/files/catapultwhitepaper.pdf
https://github.com/NemProject
https://en.wikipedia.org/wiki/NEM_(cryptocurrency
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How to Use CoinMarketCap.com

29/1/2018

2 Comments

 
CoinMarketCap.com is the go to site for most crypto enthusiasts.  Coin Market Cap maintains a comprehensive list of all the cryptos on the market.  But if you are new to trading, or cryptos, the terminology can be a bit daunting.
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CoinMarketCap.com on 30th January 2018.
Let's look at each column and decipher what information each column is conveying:

#
This is the Rank of the coin.  Rank is determined by the Market Cap.  The higher the market cap, the higher the rank.  See Market Cap below.

Name
Obviously, this is the name the coin goes by, and is accompanied by its logo.
The name is also a link to a page with more details, links, and graphs for the coin (see below).

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Bitcoin detail page on Coin Market Cap.
Market Cap
Market Cap is short for Market Capitalisation.  Market Capitalisation is a way to determine the size of a currency.  It is calculated by multiplying the Price by the Circulating Supply. (See Circulating Supply below)
Market Cap = Price x Circulating Supply.

For example, above BitCoin's Market Cap is
    Price:                           $11,320.70
    Circulating Supply:    x 16,833,825
    Market Cap:              = $190,570,682,677.50 (Rounded up to $190,570,682,678.00)

Price
Price is a volume weighted average of prices reported at each market.  This means that they take an average of the price of a coin across the markets (exchanges), but markets that have a higher volume of trading (in that coin) is considered to be a closer reflection of the value, so their value is given more weight.
The Price is also a link to a list of the markets that list the coin.
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Bitcoin Markets on Coin Market Cap.
Volume(24h)
Volume is the trading volume in the previous 24 hour period.  This is calculated by adding all the buys and sells together that were filled in the previous 24 hour period.
The Volume(24h) is also a link to a list of the markets that list the coin (see above).

Circulating Supply
Circulating Supply is an approximate number of coins that are in the general public's hands.  By contrast the Total Supply is the total coins in existence currently and Max Supply is the approximate number of coins that will ever exist in the lifetime of the crypto.
The Circulating Supply is also a link to the block explorer for that coin.  
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Bitcoin Blockchain Explorer
Change (24h)
This is the percentage the price has changed in the previous 24 hours.

Price Graph (7d)
This is a graph of the previous 7 days price changes.
If you click the graph it links to the Coin Market Cap Charts for that coin.
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Bitcoin Charts on Coin Market Cap.

Now, let's look at the top of Coin Market Cap's website.  They have a very handy top bar, with additional market wide information.
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Starting from left to right:

Cryptocurrencies
This is the number of cryptocurrencies currently on the market.
The link takes you to a list of all the cryptos, similar to the front page, but with slightly different details.
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Currency List on Coin Market Cap.
Markets
This is the number of market pairs available (BTC/ETH, BTC/USD, ETH/USD etc) across all markets.
The link takes you to a list of all the market pairings for each coin.
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Market list on Coin Market Cap.
​Market Cap
This is the total Market Cap of all cryptocurrencies.
The link takes you the global charts for all cryptocurrencies.

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Global Charts on Coin Market Cap.
​24h Vol
This is the trading volume in the previous 24 hour period of all cryptocurrencies. 
​The link also takes you the global charts for all cryptocurrencies (see above). 


BTC Dominance
This is the percentage of the total market cap bitcoin has.
​The link takes you to the Bitcoin Dominance Chart.
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Bitcoin Dominance Chart on Coin Market Cap.
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English/USD
This tab allows you to change the language and currency for the site.
​

There is so much more on Coin Market Cap.  Now that you have a basic understanding, explore the rest of the site.
For more information about Coin Market Cap see the 
CoinMarketCap FAQ.
2 Comments

Get Your Head Around Blockchain & Consensus.

20/1/2018

0 Comments

 
You were very brave clicking that link!  Don't worry, I will be gentle.  Look!  I have rewarded you already with a cute puppy (who can resist a puppy!)​.  Ok, ok, I did spend an hour looking at puppy pics, but it was in the name of research, dammit!
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Photo by Marko Blažević on Unsplash

Let's just rip the band-aid off and dive straight in.

What is a blockchain?
A block chain is the method in which cryptos achieve decentralisation.  Records (transactions and other details) get bundled together, called blocks.  Each block has a code included in it that references the previous block, which keeps all the blocks in a chain.  The data in any given block cannot be altered without the alteration of all blocks that occurred after the block, essentially making it impossible to maliciously alter the data, as making such an alteration would require the cooperation of the majority of the network.  It is this arrangement that makes the network secure.
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What is consensus?
Consensus is a process where multiple nodes (fancy word for 'someone's computer') agree that the data in a block, and in the chain, is correct.  This is an important part of the security of the network as this is a double check that the data on the blockchain is the true data. 

There are a variety of methods a blockchain can adopt including:
  *  Proof of Work (PoW)
  *  Proof of Stake (PoS)
  *  Delegated Proof of Stake (dPoS)
  *  Leased Proof of Stake (LPoS); 
  *  Proof of Importance (PoI)
  *  Delegated Byzantine Fault Tolerance (dBFT)
  *  Tangle

  *  So many more...

I won't go into the details of each type (we will be here all day!), but I will touch on the two most common, Proof of Work and Proof of Stake.

Proof of Work (aka Mining)
​This is first type and the most common method.
In order to complete a block (chunk of data) the node (someones computer) has to figure out a very complex math problem.  The complexity ensures that the computer has to use a lot of electricity.  The electricity use (and ultimately the paying of the electricity) is the cost of being a node.  When the node figures out the math problem, the node is rewarded with some cyrptocurrency.  This is called a block reward.
If a node (called a miner in this type of consensus) gets a different answer from other miners, then their answer is rejected.  A rejection is a waste of electricity, so there is an incentive for the answer to be in line with other miners.  In this type of consensus, in order to cheat the system you would need to control 51% of the computing power on the network, which is so difficult it is basically impossible. 
In this system the more computing power you have, the more likely you are the solve the math problem first, and so get the block reward.  Because of this, many nodes join their resources together (called a mining pool) so that individual nodes get a more consistent reward.
When too many computers join the network, and the math problems get solved quicker and quicker.  This is a problem because this can interfere with the stability and security of the network.  To combat this, the difficulty of the problem is increased so that the number of blocks created on the network remains consistent.  This difficulty is called Block Difficulty.
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Proof of Stake (PoS)
In this method, a node is not required to solve any math problems.   Instead one node is chosen to process the transactions and other nodes are chosen to verify the transactions.   In order to be chosen the node is required to provide a stake of currency.  This stake is locked up in a virtual safe, and if anomalies are detected from the node, the stake is forfeited.   The reward for this work is a percentage of stake, so the more currency you stake, the more likely you are to be chosen to process a block.  This means you get a bigger reward, but you also risk more currency if you try to cheat.   


Now, obviously, the reality of blockchains and concensus is way more complicated than I have explained, so if you want some more technical detail, wikipedia is a great resource.  Wikipedia on Blockchains or WikiPedia on CryptoCurrency.

Next Steps...

Continue your journey by checking out these articles next:
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Why Do We Need Cryptos At All?
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Cryptos Are Just Currencies, Right?
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Where To Store Your Coins

19/1/2018

0 Comments

 
Just like any currency, you store your coins in a wallet.  But, of course, its not just any wallet.  Its a digital wallet, or rather software that makes sure you have ownership over your coins.
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Source: pixabay.com
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There are several different types of coin storage, and many different options within each type.  Each type has their own pros and cons, as does each option.  I will touch on the most common options:   
  *  COLD STORAGE:  Hardware Wallet;  Paper Wallet.   
  *  HOT STORAGE:   Web-Based Wallet; Software Wallet.

COLD STORAGE
Hardware Wallet
A Hardware wallet is a physical object, usually similar to a USB Memory stick, used with software installed on your computer, to store your coins.  These wallets are considered to be "Cold Storage" because they are not actively connected to the internet.  This type of storage is considered to be the most secure because it is extremely difficult for someone other than the owner to steal the coins.  Note that hardware wallets are limited as to the specific crypto they can store, and each wallet is different.  Before purchasing one, make sure you check which cryptos it supports.

There are currently two hardware wallets available for purchase in New Zealand: Nano S Ledger and Trezor.  Both of these wallets can be purchased through a variety of resellers including https://coinsure.co.nz,  or through variety of sellers on TradeMe.  As with any online purchase, make sure you research the reseller to ensure they are legitimate.

The advantages of a hardware wallet is that it is not connected to the internet, so unauthorised access is virtually impossible.

The disadvantages of a hardware wallet is that they are portable, and easily mislaid.

Paper Wallet
A paper wallets are useful if you want to have an offline wallet, but do not wish to purchase a hardware wallet.   A Paper wallet is normally generated by first by a software wallet, and then printed with the wallet address and the private keys.   
The advantage of a paper wallet are  that it is not connected to the internet, so unauthorised access is impossible.

The disadvantages of a paper wallet is that it is stored on an easily damaged medium, and often require an in-depth knowledge to set it up properly.   Generally they are not advisable for a novice user.

HOT STORAGE
Web-Based Wallet
Crypto exchanges offer a web-based hot wallet in order to buy and sell cryptos.  These wallets are intended for short term storage with the express purpose of trading the coins in the wallet.  In practice many users store cryptos in these wallets long term as they are very convenient and many cryptos can be stored their.  However, this is not recommended as web-based wallets are vulnerable to hackers.
The advantages of a hot wallet is the convenience of access and trade.  With a username and password, you can log in to your exchange of choice and easily see your holdings, and your coins are immediately available for trading or moving to another wallet.  Another advantage is that the security of your wallet is taken care of by someone else, and most exchanges will give you a variety of additional options for security such as two-factor authentication.
The disadvantages of a hot wallet is that it is vulnerable to hacking and as you don't own the wallet (the exchange does) you don't have control over it.  This means if the exchange closes or is hacked, then your coins are vulnerable to loss.  Exchange also have their own rules as to how much you can transfer into your wallet at a time (most wallets have minimums) and rules as to how you can use your wallet.  For instance many exchanges will not allow you to mine directly into one of their wallets.

Software Wallet
A software wallet is a wallet that you install onto your computer or mobile phone.  You have complete control over this wallet, which means you are acting as your own bank, so the security of your wallet is entirely in your hands.  Most cryptos have their own version of a software wallet where can can store one crypto or a variety of related cryptos.  There are also multi-wallets such as Jaxx or Exodus which allow you to store a wide variety of cryptos.  There is not yet a universal wallet that can hold any crypto.​

For a full list of available wallets, check out  Crypto Compare.  


Next Steps...

Continue your journey by checking out these articles next:
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What is Mining and Staking?
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Keep Your Cryptos Safe
0 Comments

What is Mining and Staking?

19/1/2018

0 Comments

 
Mining and Staking are the two most common ways to earn crypto, while being an active part of the crypto network.  Miners and stakers form the basis of a crypto network, and do most of the work verifying transactions and building the blockchain.
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Photo by Sushobhan Badhai on Unsplash
When a crypto is created its founders asks themselves an important question.  How will our transactions get verified?  Verification is called Consensus and is the process where transactions are confirmed as true and then secured into the blockchain.  There are a variety of consensus types, but by far the two most common are Proof of Work (Mining) and Proof of Stake.  Once a crypto has made the decision to use a particular type of consensus, they invite others to join their network as Miners (if they have chosen Proof of Work) or Stakers (if they have chosen Proof of Stake).  Each type has its own reward structure.  If you are a miner, then you will be rewarded for the amount of computing power you add to the network.  If you are a Staker, then you will be rewarded for the amount of currency you stake.

Mining
In order to mine a coin, you will require a computer.  The faster and more powerful, the better.   There are three types of computers that you can use to mine, and the equipment you use depends on the particular crypto you wish to mine.   CPU Mining; GPU Mining; ASIC Mining;
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CPU Mining
CPU Mining is the first type of mining created.  This kind of mining uses a computers CPU (Central Processing Unit) to process the transactions.  All computers have a CPU, so this type of mining is accessible to all those who own a computer.  However, mining is a very intensive task, so the CPU is unavailable for other tasks if it is being used to mine.  Many cryptos are no longer able to be mined using a CPU as either the level of difficulty has been raised to the point that it is not financially viable to mine using your computers CPU or the code has been altered so that it is no longer possible to mine with a CPU.
​However, there are coins that can be mined using your CPU.  Check out CPU Coin List for a list of what can be mined.   

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GPU Mining
Computers that are built to render or edit graphics, or computers built for gaming will include a graphics card that has its own CPU (called a GPU, Graphical Processing Unit) that is built to specifically process the type of calculations that graphic rendering requires.  This type of processing is much faster and more efficient than a standard CPU.  GPU mining is designed to use a GPU, and as it is more powerful and can provide adequate resources to the network, GPU mining is often profitable for miners.
In order to profit to most from this type of mining, miners often construct purpose built mining rigs, that include multiple graphics cards, joined together using a frame (pictured above).
You can check our what cryptos are profitable to mine with a GPU from What To Mine. 

Picture
ASIC Mining
ASIC (Application-Specific Integrated Circuit) is a mining specific CPU that is designed to be as efficient as possible when processing mining calculations.  These CPUs are usually installed into a mining specific case (such as the Bitmain D3, pictured here), and sold as a mining specific computer.  These computers can only be used for mining.   ASIC mining a specific to some cryptos, as the code for the crypto must be compatible with an ASIC miner.  What to Mine has a calculator that will allow you to estimate your profits, depending on the power of your miner.  This style of miner range in price from $NZ3,000 to $NZ20,000, but are the most powerful miners available, so are able to produce the best return on investment.

Staking
​In order to stake, you also need a computer.  But not a powerful one, just one connected to the internet.  You will also need the currency of your choice.  This is your stake.  This stake is locked up in a virtual safe, and if anomalies are detected from the node, the stake is forfeited.   This is your incentive to not defraud.  Your reward for this depends on the crypto you are staking, but is usually 5%.   
Most cryptos that are staked will have a calculator page that will help you calculate how much currency you need to stake in order to make a profit (over and above your expense of electricity and equipment you might purchase.  
Staking is generally a less technical venture, so is open to all those who have a computer connected to the internet, and spare cash.

For a list of cryptos that you can stake, check out Proof-of-Stake Coins List.  This includes the reward percentage, and appropriate links to get you started staking.
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