Can someone explain the whole crypto thing to me?

[Anonymous]

Cryptocurrency* how do you make money with this? I have no idea what it is

[Soteris]

My suggestion is: Dont. While you can make money on Cryto a lot of it is based on preying on people like you who does not understand what they are doing. Getting into Crypto without having a passion for understanding it means that you are a sheep walking into a den of wolves.

As for what Crypto currencies actually are, in simple words it is all about the question of proving ownership. Where as other forms of proof of ownership relies on a central authority such as the government to keep track and enforce who owns what, crypto currencies instead wanted to create a system where it is the users who keeps track of ownership and as a result make it virtually impossible for someone to for example take your property away from you just because they had access to the authority that maintains the records such as again, the government.

The technology that enables crypto currencies to keep track of who owns what as well as who trades what to whom is called blockchain. It is basically a ledger that records the history and holders of every crypto at all times and everyone has access to it but it is virtually impossible to fraudulently change it.

There are two ways to really make money using crypto. One way is to "work" for it. Blockchain requires people to do a lot of math at all times to protect the ledger and allow people to trade with each other, in exchange the computers that do the work gets a small amount of payment. This however is not really worth it for normal people anymore since the amount being paid out does not increase as quickly as the number of people who it is being paid out to which means you are getting less and less as time goes on.

The other way is to view crypto as a form of financial investment. Something that has value independently from your money and can either gain or lose value in comparison. Buying crypto and having the value of crypto increase means you can sell it for more money than you bought it. This has been a fairly reliable way to increase your money over time since outside of some major spikes and drops it has maintained a fairly reliable rate of growth. Over a long enough time it should increase in value regardless of occasional spikes in either direction.

There are also NFT's and such nonsense but I recommend you stay even further away from that. See buying and selling crypto as a form of stock trading as it is very similar. It is also risky just like stocks is.

[Astarlessnightsky]

Basically people believe its worth something and will invest money in it.

Also Bitcoins (and probably other cryptocurrencies as well) are limited, so there is a shortage, which gives them some kind of value as well.

And you make money by buying coins and selling them at a higher price.

Or buy using your PC to "mine" them, you use your pcs hardware to encrypt the transactions and you will earn a really low amount of coins for it. Which you can sell, abd hopefully get enough to pay your electricbill.

[jshm2]

Think of it like this

You know wine has value, right? You can trade wines and invest in wines. There are people who just make wine, some who just drink it and everything between. There are wines in the world worth thousands a bottle.

Well, imagine that but for digital tokens\currency. There is a whole market around it and it's taking off. But just like there are fake wines, so there are many scammers out there too. You make money by selling those tokens, but also investing in them.

[exitseven]

From what I can see it is an abstract idea. Somebody on the internet tells you that a bitcoin is worth 40 thousand dollars. So you give them 40 thousand dollars in cash and they tell you that you have a bitcoin which is stored on the internet. There is really no hard record of this transaction and they make it really hard to get your money back.
There is no government regulations or backing by a large corporation like with bearer bonds
You can tell all your friends and collogues that you own bitcoin.

[LaFemmeFatale_1]

Never give your money to somebody who’s telling you they’ll buy the bitcoin for you. They’re scammers and will disappear with your money, if you want to buy bitcoin, you should buy yourself after first exploring and finding a reliable exchange for making a purchase.

[exitseven]

@LaFemmeFatale_1 okay- In the next town a guy was called by somebody who said he was his grandson's lawyer and he was in jail. He asked him for 8 thousand dollars and told him to use the Bitcoin machine in a local 7-11 store. The guy does what he was told and then he got suspicious and went to the cops. The cops tell him he was scammed so he goes to the 7-11 store to get his money back. He was told he could not get it back even though it was still physically in the machine. So what happens if the guy gets a length of chain and attached it to his front bumper and pulls the door off the machine and reaches in and takes his money back. The scammer still has the bitcoin and the guy has his cash so who takes the loss?

[Zenit93]

This is what I do for living. It’s so much to explain, but basically it starts with Bitcoin. Currencies as of today are not backed by commodities, and the government utilizes the ability to print money to lower the impacts of market peaks and troughs. When you print money, or in other-words unscrewed the supply, the value depreciates. This is what we call inflation. Your dollars in other words lose value through time. Bitcoin has a finite supply, meaning you can’t create anymore. Therefore the secular trend always goes up with the more money they print. There’s also a factor of property rights and owning your bitcoins without a third party. Other coins offer different benefits and attributes. Watch Michael Saylor talk about bitcoin on YouTube if you want to learn.