THE BASICS FOR UNDERSTANDING THE BITCOIN AND CRYPTOCURRENCY REVOLUTION

The world financial systems are currently undergoing a very rapid and unprecedented revolution since the genesis of Bitcoin in 2009. People with their ears to the ground, those who understand the risks and benefits of participatory learning have not only been happy with their risky decisions, most of them have actually been elevated to the ''never-to-be poor-again'' status.

Yet (and unfortunately though), many people especially in the developing world do not even know what is going on.

If you are among the folks that are yet to be in the know, well, it is not too late. I'm actually packaging this piece together for you. I will try to be as explicit as it is humanly possible to make you visualize this invisible digital world concept in your imaginations and to enable you grab the concept and start running with it.

I'm really dedicating this to fellow Nigerians and Africans in particular, to encourage us to key into this at this time. However, the information here can help anybody from any part of the world as digital/internet revolution of any kind, including the cryptocurrency concepts are global issues.

So I solemnly request that you read this with unbiased mind and also share the site link with your friends and folks and via the social media for a wider read.

WHAT ARE BITCOINS AND CRYPTOCURRENCIES?

May I refer you to the the Wikipedia definition which said and I quote: 

"A Cryptocurrency is a digital asset designed to work as a medium of exchange using cryptography to secure the transactions and to control the creation of additional units of the currency. Cryptocurrencies are a subset of alternative currencies, or specifically of digital currencies. 

Bitcoin became the first decentralized cryptocurrency in 2009 and since, numerous cryptocurrencies have been created . These are frequently called altcoins, as a blend of bitcoin alternative. Bitcoin and its derivatives use decentralized control control as opposed to centralized electronic money/centralized banking systems. The decentralized control is related to the use of bitcoin's blockchain transaction database in the role of a distributed ledger."

You can go to Wikipedia here for full details. 

I think the above definition and description is as simplified as A,B,C. But may I say in simpler terms that, cryptocurrency means the kind of digital currency for transactions that are programmed and secured with the highest level of security (encryption/decryption krypto >Greek for secure> graphy) in such a way that, by no means can it be abused by creating more of the type, or influencing its purchasing power or robbing the owner of its values through any manipulation, by a government, a third party or any intermediary interference, except by the law of market forces (decentralization).

From the image below, you can see when Bitcoin, the first cryptocurrency was introduced, and its value current value. In fact,  1 Bitcoin was traded for $3,000 on the 10th of June this year but dropped to $2,450 as the time of this write up. It is speculated that its value may go as high as $5,000 by the end of 2017 and possibly a $10,000/bitcoin by the end of 2018!!

I know of a friend who bought a 500,000 Nigerian Naira worth of Bitcoin (1.12 btc) in January 2017 at the rate of 1 Bitcoin to 447, 000 NGN and the worth of that bitcoin in his wallet today, 5 months down the line, is over a million Naira at 940,000 NGN/btc!!. He actually sold the 1 Bitcoin at 6,000,000 NGN in December same year.

The number of other Cryptocurrencies preferably called the "Altcoins" are increasingly emerging everyday and people are tracking them and trading on them. Below is a list of the top ten as at the time of this print.

WHAT IS THE BLOCKCHAIN TECHNOLOGY?

I know that wikipedia is not an authority speaker, but we all go their for general knowledge information. So I'm going to rely on it again to explain Blockchain here and I quote:

"A blockchain is a distributed database that is used to maintain a continuously growing list of records, called blocks. Each block contains a timestamp and a link to a protocol for validating new blocks. by design, blockchains are  are inherently resistant to modification of the data. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network. Functionally, a blockchain can serve as 'an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. The ledger itself can also be programmed to trigger transactions automatically'

Blockchains are secure by design and are an example of a distributed computing system with high Beyzantine fault tolerance. Decentralized consensus has therfore been achieved with a blockchain. This makes blockchains potentially suitable for the recording of events, medical records, and other records management activities, identity management, transaction processing and documenting provenance.

The first blockchain was conceptualised by Satoshi Nakamoto in 2008 and implemented in the following year as a core component of the digital currency bitcoin, where it serves as the public ledger for all transactions.The invention of blockchain for the bitcoin made it the first digital currency to solve the double spending problem, without the use of a trusted authority or central server. The bitcoin design has been the inspiration for other applications"

More details of this can be gotten from Wikipedia here .

Simply put, Bitcoin is thriving on the Satoshi Nakamoto ingenious Blockchain Technology. You can log into Blockchain Here to see the hundreds of thousands of transactions that occur daily, all perfectly masked, yet an open ledger! 

There are near 21 million Bitcoins possible with no additions and no subtractions.  Bitcoins are made available for use through cloud mining by miners in the Blockchain pools

WHO ARE USING BITCOINS AND ALTCOINS TODAY?

First of all, you need to remember again that your acquired bitcoins and the altcoins are completely digital and so you can not carry them like the fiat currencies in your physical wallets. However, they are exchangeable with almost all currencies in the world.

So the first person to use these currencies should be "You" in your day to day lifestyles. But you may have to first of all convert them to their fiat counterparts through the appropriate and easy to follow exchange media or transact directly with them. 

Secondly, the world is using Bitcoin!!. It has been impossible for any country to restrict its movement as it flies in the wing of the internet.

Now to understand how big, accepted and revolutionary these have been, check this Facebook group to see a list of Companies in the US alone that are accepting Bitcoin in their businesses:  CLICK HERE

As at May 2017, more countries are reversing their illegal tags  on the use of Bitcoin to acceptable currency.  In this publication, Wikipedia x-rayed the positions of different countries and regions of the world on Bitcoin. Check it out in Wikipedia Here

Yea, even though countries like Nigeria and few others still tagged Bitcoin an illegal tender, the truth remains that Bitcoin is a decentralized currency. It is a mystery and can be termed *odieshi* in Igbo parlance. What I simply mean here is that no country can stop its movement within her territory. This is because, Bitcoin is not transferred via any institution like banks, you cannot trace who is doing the transfer or the receiver as every transaction is via ''encrypted'' long chains of codes in places of account names and numbers. It's the highest level of mathematical coding of our time!

Again, it is also important to note that the secular financial institutions have began to see an arch-competitor in business.  But whereas the great nations like USA, Germany, Russia, Japan, India, Brazil and lots of others with their financial institutions have seen the  foolishness in fighting a cryptographic decentralised system, they immediately keyed in to explore its advantage as early worms, while many developing worlds are making policy statements against a system they don't even understand its configurations. In Nigeria for instance, thousands of her citizens are involved in legitimate trading and mining of Bitcoins and Altcoins and there is no way any policy statement can track or stop these. 

The illegality tag on bitcoin in any country can only prevent its exchange from taking place through their secular financial institutions and thereby also preventing the government agencies from tracking its movement in any scale whatsoever.

It's important to mention here that one of the deadly disadvantage of Bitcoin is the money laundering potential it can create. We remember that this is a form of financial movement where the sender and the receiver cannot be tracked as everything is done via digital encryption. So banning the banks from transacting with bitcoins is like closing the government's only eye for tracking any laundering of funds through bitcoins and altcoins. The US government understood this and tried to put up some regulations by allowing only one exchange medium, the CoinBase which allows the linkage of bank accounts and debit cards with owners of CoinBase wallet. Although this is not fool proof as people can bypass Coinbase wallet in US and connect directly with Blockchain, the bitcoin ledger.

Even in Nigeria, despite the illegal tag on virtual currencies, money is moving freely across the shores through Localbitcoins trading platform, Coinbase, Luno and Nairaex exchangers as well as through a lot of other corporate and private exchange firms that have evolved along the line.

THE PROS AND THE CONS OF GETTING INVOLVED WITH CRYPTOCURRENCIES

The most important advantages of Bitcoin and some other Altcoins are their global acceptance (even by most world governments and establishments), freedom of control by any government systems, or their sole control by market forces alone. As a result, there are very minimal transaction charges (just to compensate the miners of these currencies), as compared to those imposed during transfer of fiat currencies. 

Another advantage is the near instant transaction speed. I have had a bitcoin transaction getting confirmed in less than a minute! 

Then imagine you transferring all your money in bitcoins and then travel to any part of the world where you can comfortably cash it out in that local currency without any exchange fees. You may be luck to get a higher value at the time of withdrawal due to appreciation of the value.

The main disadvantage is  the fact that Bitcoin and some of the Altcoins have anonymous originators. Satoshi Nakamoto is the name masking the originator of Bitcoin and till date, nobody knows who is Satoshi Nakamoto.  A lot of reasons have been debated on why the guy or gal decided to remain anonymous despite his ingenious creation, but that will be a story for another day. So nobody can really say whether there are any hidden agenda. Although  lots of  studies have proven this wrong, one can never say.

The next disadvantage is the money laundering opportunity these can create especially in most developing worlds where the concerned regulatory bodies can simply make policy statements without actually having studied the system or make any attempts at blocking the loopholes these can create.

The most important challenge of the Cryptocurrency system is its hijack by the online scam world! Bitcoin itself for instance, is a great opportunity and the most sort after and most ranked currency in the world with one piece exchanging for $2500, the scammers are giving it a bad name.

CAN YOU BE PART OF THE REVOLUTION?

Why Not!

Remember the quote above that if you had bought a $100 worth of bitcoin 6 years ago, you would have worth $750, 000, in fact at today's rate, over $1,000,000!! This is just buying it and keeping it. This is different from real mining it or trading it where you populate the quantity while the market forces cause the appreciation of the exchange value!

HOW YOU CAN BE PART OF THE CRYTPOCURRENCY REVOLUTION

We are now at the meat of the entire discuss.

Actually this can be, and has been a wealth creation revolution to many people. But even at that, cryptocurrency has become the 21st century most treasured currency. So you cannot be kept in the dark or rather, you cannot keep yourself in the dark.

At this point I'm going to concentrate on Bitcoins serving as a guide to the altcoins.

The entry point into the Bitcoin acquisition is the procurement of one or more Bitcoin wallet accounts.

The next step is either to buy the Bitcoins (recommended) or to join some Free Bitcoin Faucets to acquire very tiny fractions daily, as a reward for doing some menial tasks for the owners of the sites.

The initial bitcoins you acquired these ways can now be kept in your wallets to be appreciating and later on, you can sell part or all of that at the new appreciated rate. I gave an example of someone who bought 1.12 bitcoins 5 months ago at 500,000 NGN and the value today is over one million Naira.

The other way to go about it is to go into real Bitcoin business. This can be in the way of  mining business or trading business.

OPENING A BITCOIN WALLET ACCOUNT

The most useful wallets are those ones that serve, not only as a payment gateway, but also serve as platforms for exchange and trading with the persons local or desired currencies. The wallets of global repute that are very suitable for these purposes in the African setting now are as follow:.

BINANCE: Just follow the prompting to create your own Binance exchange wallet account

LUNO: The next Wallet system that Allows exchange between Local currency and Bitcoins directly is Luno. While LocalBitcoin operates like AliBaba online market where various merchants advertise their wares and buyers contact and transact with them, Alibaba site acts as an umpire. Luno is owned by a corporate organisation who sells and buys bitcoins from individuals. It permits the linkage of ones bank or debit card account for transactions.  It similarly allows opening of free account, doing your KYC (Know Your Customer) verification with names that must tally with names on the bank account details your submitted.

So to get a free wallet, you also need to sign up at Luno Here.

COINBASE: This is seen as the most popular and widely used wallet, even in the USA.

Recently Coinbase has also invaded most African nations as it did, the western worlds. Its a great trading tools and can permit exchange between Bitcoin and the three major Altcoins, Etherium, Litecoin and Dash as well as between all these cryptocurrencies and any local currency.  A KYC is needed as well here and transactions are between merchants.

To sign up for free, click on COINBASE Here.

 Freebit.in Faucet

Moonbit Faucet

There is this common saying: If you cannot run walk, crawl, but please don't stand still. This is my opinion: "Africa must not lag behind in this revolution". I'm doing what I'm preaching here and  therefore I extend my right hand of BRA (Bitcoin Revolution Africa), to you. And, please know: "Cryptocurrencies are the 21st century currencies and you should be part of these."

Feel free to leave behind your views, questions, and remarks in the comments column below, but please do not post any link.

And, let's I forget: if you would like to take advantage of our Blockchain Community, the strongest and fastest growing in the world, take a look here: 

"The Rewarding Blockchain Community"  

Or watch this 4-minute video and get back to me via this email:  mygmaildotcom

Enjoy your entrance to the Cryptocurrency Revolution.