Everyone has heard of Bitcoin. Even non-techies have invested in cryptocurrency on the advice of a friend, in hopes of hitting “the next big thing”.
But most people have absolutely no idea about the real value of cryptocurrency, or why it’s generating so much buzz over the past few years.
Most people assume it’s just used to buy drugs from the darkweb, get-rich-quick dreams and schemes, memecoins like Dogecoin, and most recently, NFTs. (“Why would anyone pay millions for a JPEG of a monkey?”)
I’m not going to tell you that they’re wrong, because they’re not.
There are a lot of valid criticisms about the state of crypto today, and most of it is just snake oil. But maybe — just like politics and religion — it’s not the technology that’s bad, but the way people have implemented it and abused it for their own gain.
I’m going to share with you a little of my understanding of what I think crypto really means, and why I’m such a passionate supporter of it.
What is Money? (Don’t hurt me, no more)
Sending, sharing, and managing your money is a trillion-dollar industry. Your money is important, you have a right to own and manage your own money, and protect your privacy.
Whether it’s your Visa Debit card, your AmEx credit card, your bank account, Zelle or PayPal, Venmo, Facebook Marketplace, or even loyalty card phone number for gas points — nothing is free.
You are the product — your data and your privacy are being sold to the highest bidder. Just like your browser history, your spending habits help companies predict your habits. You have a right to your privacy, and not have your spending habits analyzed and used to track you.
Cash is private, but not as convenient — you can’t buy items online with cash; dealing with exact change, making change, or dealing with coins is a pain-in-the-ass; and of course is a disease vector, so many places aren’t even accepting it due to the current public health situation.
Money 2: Electric Boogaloo
So where does that leave us? Enter Bitcoin.
Instead of relying on abstractions like Modern Monetary Theory and governmental fiscal policies, Bitcoin was designed to rely on discrete, proven mathematical principles — including decentralization so no one entity was in control.
The idea of a distributed, private, math-based money obviously has some merit; otherwise there wouldn’t be a million copycats and even Central Banks (like China and the United States) trying to make their own digital currency based on the same principles.
Eenie Meenie Miney Mo, Four Coins That You Have To Know
There’s literally thousands of variations of crypto, but there are a few big ones you should be aware of. They all have different uses, but especially be mindful of the difference between “Bitcoin” and “Bitcoin Cash”, since they both have similar names.
Bitcoin (BTC) was the first. Due to it’s power consumption (on par with a small country) and resistance to changing anything about the core protocols, it is a little harder to use. Some liken it to “digital gold”.
Bitcoin Cash (BCH) considers itself the spiritual successor to Bitcoin. With some community-backed changes to the core protocol, it’s able to transfer money instantly, for less than 1 cent fee. It has a huge worldwide following of businesses and enthusiasts and is arguably the best implementation of electronic cash there is.
Ethereum (ETH) provides programming capability, using smart contracts to code in fair gambling or betting protocols, creating and trading sub-coins, and of course — the notorious NFTs.
Monero (XMR) is truly privacy-focused, which means in addition to transferring money, it’s likely often used for things like ransomware, tax evasion, and black market transactions like buying kidneys. (But can’t be proven.)
Lucky Red Envelopes and Paper Wallets
It’s a Chinese tradition for the Lunar New Year, to give away money in red envelopes, as a symbol of prosperity and for luck for the new year. (I’ve celebrated Chinese New Year ever since I lived in China, having taught ESL during my gap year right out of high school.)
This year, I thought it would be a great opportunity to use the lucky red envelopes to introduce some friends and family to crypto, as well as test out the practicality of paper wallets.
Paper Wallets are a way to share and use Bitcoin in a physical medium. Eventually you still need a digital wallet of some sort to trade, settle, or scan the QR code, but paper wallets can be used to “physically put bitcoin in your safe”, or to share or give to people in real-world scenarios. It’s just a printed version of the electronic math to allow you to share and trade.
The process of removing coins from a paper wallet, is referred to as “sweeping” the wallet. There’s a technical difference between sweeping (emptying the paper wallet into your wallet), and importing the private key (which is basically converting the paper wallet into a digital wallet).
Keep in mind that many “Centralized exchanges”, such as crypto.com, Robinhood, Coinbase, and others may not have full “wallet” functionality. They may hold onto your private keys as a “custodial” wallet, may not allow you to fully interact with the ecosystem, as these exchanges are mostly taking your hard earned money and leveraging it against crypto to make them even more money, while giving you the illusion of control.
Step by Step
Here are the details and step by step on how to use the paper wallets I gave out for Chinese New Year. Specifically, how to “sweep” or transfer the coins to your wallet.
- This is Bitcoin Cash (BCH), not “old Bitcoin” (BTC). Most people recognize that when talking about Bitcoin, that we’re referring to BCH not BTC.
- There is 0.01 BCH in each wallet.
- I cannot provide details about your crypto.com, Robinhood, or other exchange; but you should be able to follow the steps below.
- I recommend Coinomi wallet for your smartphone, as the easiest way. You may choose a different wallet software, but do your own research and don’t fall for scammy ones. Download Coinomi from the App Store.
- Setup Coinomi, including setting a password, etc.
- On the main screen, add Coin, and select Bitcoin Cash.
- Then, once you have Bitcoin cash showing on your main screen, click on it. From here you can see the Send and Receive options on the top left / right, which can be swiped left / right to access. But, we want to stay on this page, the “balance” page.
- Click the + sign, choose scan QR code.
- Unfold the paper wallet to reveal the PRIVATE key. Scan it with your phone. Click “next”
- Check out the details – fee to transfer will be about $0.01. Go ahead and confirm.
- You’ll see the transaction show as grey for a few minutes. This means it’s been broadcast to the network and is as good as done — just takes a few minutes for the back-end to ‘confirm’ the transaction.
- After a few minutes, it will turn green, indicating you received it.
- Then if you want to send it to your exchange, you should find your Exchange wallet address. Then use the “send” functionality here and send it.
That’s (not) all, folks!
Congrats! You’re just $999,997 short of being a ‘cryptonaire’ now.
The $3 or so of BCH isn’t much, but enough to get you started spending, sharing, and learning about it.
If you’re not sure what to spend it on, check out Easy Rider Radio (a live streaming radio platform I created for a client), who will gladly accept BCH as a tip on their Tip Jar page.
I’m working on a few exciting projects in the crypto space right now, beyond NFTs. Stay tuned for exciting announcements!