The Latecomers Guide to Crypto – The New York Times

crypto is many things, even terribly explained. We are here to clear things up.

Until relatively recently, if you lived anywhere other than San Francisco, it was possible to go days or even weeks without hearing about cryptocurrencies.

now, suddenly, it’s inescapable. look to the side, and there’s matt damon and larry david doing ads for crypto startups. turn your head: oh, hey, it’s the mayors of miami and new york city, arguing over who loves bitcoin more. Two NB arenas are now named after crypto companies, and it seems that every corporate marketing team in the United States has jumped on the NFT, or non-fungible token, bandwagon. (may I interest you in one of pepsi’s new “mic drop” genesis nfts? or maybe something from applebee’s “metaverse food” nft collection, inspired by the chain’s “iconic” menu items? restaurants?)

Reading: Bitcoin reviewit crypto guide

crypto! For years, it seemed like the kind of fleeting tech trend that most people could safely ignore, like hoverboards or Google Glass. but its power, both economic and cultural, has become too great to ignore. Twenty percent of American adults and 36 percent of millennials own cryptocurrencies, according to a recent morning query survey. Cryptocurrency trading app coinbase has risen to the top of the app store charts at least twice in the past year. Today, the crypto market is valued at around $1.75 trillion, roughly the size of Google. And in Silicon Valley, engineers and executives are leaving cushy jobs en masse to join the crypto gold rush.

As it became more mainstream, crypto has inspired an unusually polarized discourse. his biggest fans think he’s saving the world, while his biggest skeptics are convinced it’s all a scam: an environmentally destroying speculative bubble, orchestrated by con artists and sold to greedy chumps, likely to crash the economy when it bursts.

I’ve been writing about crypto for nearly a decade, a period in which my own views ranged from extreme skepticism to cautious optimism. These days, I usually describe myself as a crypto moderate, though I admit that can be a dodge.

I agree with the skeptics that much of the cryptocurrency market is made up of overvalued, exaggerated, and possibly fraudulent assets, and am unmoved by the more utopian sentiments shared by cryptocurrency fans (such as jack dorsey, the former head of twitter, that bitcoin will usher in world peace).

But as I’ve experimented more with cryptocurrencies, including accidentally selling an nft for over $500,000 at a charity auction last year, I’ve come to accept that it’s not all cynical money-grabbing, and that there is they are things of real substance that are being built. I’ve also learned, in my career as a tech journalist, that when so much money, energy, and talent is flowing into something new, it’s usually a good idea to pay attention, regardless of your views on the topic itself.

However, my strongest belief about crypto is that it is terribly explained.

Recently, I spent several months reading everything I could about crypto. But I found that most beginner’s guides took the form of boring podcasts, under-researched YouTube videos, and blog posts written by hopelessly biased investors. many anti-cryptocurrency outlets, on the other hand, were undermined by inaccuracies and outdated arguments, such as the claim that cryptocurrencies are good for criminals, despite mounting evidence that cryptocurrency’s traceable ledgers make it untrue. suitable for illicit activities.

what I couldn’t find was a sober, dispassionate explanation of what crypto really is: how it works, who it’s for, what’s at stake, where the battle lines are drawn, along with answers to some of the questions more common. he wake up.

This guide, a great FAQ, is actually an attempt to fix it. In it, I’ll explain the basics as clearly as I can, doing my best to answer questions that a curious but open-minded skeptic might raise.

Crypto promoters will likely object to my explanations, while entrenched opponents may find them too generous. it’s okay. my goal is not to convince you that cryptocurrencies are good or bad, that they should be banned or celebrated, or that investing in them will make you rich or bankrupt. It’s just to demystify things a bit. And if you want to dig deeper, each section has a list of suggested readings at the end.

cryptocurrencies will be transformative

Understanding cryptocurrencies now, especially if you are skeptical by nature, is important for a number of reasons.

The first is that crypto wealth and ideology will be a transformative force in our society for years to come.

You’ve heard of overnight dogecoin millionaires and bitcoin bros running lamborghini. but that’s not even half of it. The cryptocurrency boom has spawned vast new fortunes at a rate we have never seen before (the closest comparison is probably the discovery of oil in the Middle East) and made its biggest winners some of the richest people in the world. essentially overnight. . Some riches could be gone if the market crashes, but enough has already been cashed in to ensure cryptocurrency’s influence lasts for decades.

The wacky online culture crazed by cryptocurrency memes can make it seem frivolous and superficial. It is not. cryptocurrencies, even joke ones, are part of a well-funded and solid ideological movement that has serious implications for our political and economic future. Rising from the ashes of the 2008 financial crisis, bitcoin first caught on among libertarians and anti-establishment activists who saw it as the cornerstone of a new, incorruptible monetary system. Since then, other crypto kingdoms have created similarly lofty goals, such as building a decentralized and largely unregulated version of Wall Street on the blockchain.

We are already starting to see a wave of crypto money heading towards the US. uu. political system. crypto entrepreneurs are donating millions of dollars to candidates and causes, and lobbying firms have fanned out across the country to garner support for pro-crypto legislation. in the years to come, crypto tycoons will fund the campaigns of crypto-friendly candidates or run for office themselves. some will sell influence in the familiar ways (forming super pacs, funding think tanks, etc.), while others will attempt to escape partisan gridlock altogether. (Crypto millionaires are already buying land in the South Pacific to build their own blockchain utopias.)

Cryptocurrencies will soon become one of many key issues, and politicians around the world will be forced to choose a side. Some countries, like El Salvador, whose crypto-loving President Nayib Bukele recently announced the development of a “Bitcoin City” at the base of a volcano, will go fully crypto. other governments may decide that cryptocurrencies are a threat to their sovereignty and crack down, as China did when it banned cryptocurrency trading last year. the divide between the pro-crypto and non-crypto parts of the world could end up being at least as great as the divide between the Chinese and American internets, and perhaps even more important.

In the United States, we have already seen how cryptocurrencies can disrupt habitual partisan loyalties. former president donald j. Trump and Sen. Elizabeth Warren, the Democrat from Massachusetts, are united in crypto-scepticism, for example, while Sen. Ted Cruz, R-Texas, is in the same optimistic camp as Sen. Ron Wyden, the Democrat from Oregon. We’ve also seen what can happen when the crypto community feels politically threatened, as happened last summer when crypto groups banded together to oppose a crypto-related provision in President Biden’s infrastructure bill.

I guess what I’m saying is that, despite the silly appearance, cryptocurrencies are not just another weird internet phenomenon. it is an organized tech movement, armed with powerful tools and hordes of wealthy true believers, whose goal is nothing less than total economic and political revolution.

crypto could be destructive

The second reason to pay attention to cryptocurrencies is that understanding them now is the best way to ensure they don’t become a destructive force later.

In the early 2010s, the most common knock on social media apps like facebook and twitter was that they just didn’t work as businesses. experts predicted that users would eventually tire of their friends’ vacation photos, that advertisers would flee, and that the entire social media industry would collapse. The theory wasn’t so much that social media was dangerous or bad; it was just boring and cheesy, a fad that would go away as fast as it came.

What no one was asking back then, at least not out loud, were questions like: what if social media is incredibly successful? what kind of regulations would have to exist in a world where facebook and twitter were the dominant communication platforms? how should tech companies with billions of users weigh the trade-offs between freedom of expression and security? What product features could prevent hate and misinformation online from turning into violence offline?

by the middle of the decade, when it became clear that these were pressing questions, it was already too late. platform mechanics and ad-based business models were already built in, and skeptics, who might have steered these apps in a better direction had they taken them more seriously from the start, were stuck trying to contain the damage.

Are we making the same mistake with crypto today? it’s possible. Nobody knows yet if cryptocurrencies will “work” or not, in the broadest sense. (Anyone who claims they do is selling something.) but there is real money and energy in it, and many tech veterans I have spoken to tell me that today’s crypto scene feels, to them, like 2010 all over again, with disruptive technology. money this time, instead of means.

if they’re wrong, they’re wrong. but if they are right, even partially, the best time to start paying attention is now, before the paths are established and the problems are intractable.

The third reason to study cryptography is that it can be really fun to learn about.

sure, a lot of this is silly, shady or self-refuting. but if you can look past the carnival barkers and parse the complicated jargon, you’ll find a bottomless pit of weird, interesting, and thought-provoking projects. the crypto agenda is so huge and multidisciplinary, bringing together elements from economics, engineering, philosophy, law, art, energy policy, and more, that it offers plenty of footholds for beginners. Do you want to discuss the influence of the Austrian economy on the development of bitcoin? there’s probably a discord server for that. Do you want to join a dao that invests in nfts or play a video game that pays you in crypto tokens for winning? dive in

crypto is a generational master key

I am not, however, suggesting that the world of cryptocurrencies is diverse, in the demographic sense. Surveys have suggested that high-income white males make up a large portion of cryptocurrency owners, and libertarians with dog-eared “atlas shrugged” copies are likely overrepresented among crypto millionaires. but it is not an intellectual monolith. there are right-wing bitcoin maximalists who believe that cryptocurrencies will liberate them from government tyranny; leftist ethereum fanatics who want to topple the big banks; and speculators without ideological attachments who just want to make a profit and get out. these communities are constantly fighting each other, and many have very different ideas about what crypto should be. it’s a fascinating study, especially with a bit of emotional distance.

And if you learn a few crypto basics, a whole world may open up before you. you’ll understand why jimmy fallon and steph curry are swapping their twitter avatars for cartoon apes, and why elon musk, the world’s richest man, spent a good chunk of last year tweeting about a digital currency named after a dog. weird words and phrases you find on the internet (rug pulls, flippenings, “gm”) will become familiar, and eventually headlines like “nft collector sells people fursonas for $100k in right click mentality war ” won’t make you doubt if you’re losing control of reality.

crypto can also be a kind of generational master key, perhaps the fastest way to refresh your cultural awareness and decipher the beliefs and actions of today’s youth. And just as knowing a little about mysticism and new-age psychedelics would help someone trying to understand youth culture in the 1960s, knowing a few basics of crypto can help someone perplexed by emerging attitudes about money and the power to feel more grounded.

again, I don’t really care if you emerge from these explanations as a true believer, a devout skeptic, or something in between. participate or abstain as you wish! all I seek is understanding and possibly some relief from the question that has consumed my social and professional life for the last several years:

“so… can I ask you a question about cryptography?”

Let’s start from the beginning: what is crypto?

A decade or two ago, the word was generally used as shorthand for crypto. but in recent years, it has become more closely associated with cryptocurrencies. these days “crypto” generally refers to the entire universe of technologies that involve blockchains, the distributed ledger systems that power digital currencies like bitcoin, but also serve as the technology base layer for things like nfts, web3 applications and defi trading protocols.

ah yes, blockchains. Can you remind me, without going into too much technical detail, what they are?

At a very basic level, blockchains are shared databases that store and verify information in a cryptographically secure manner.

You can think of a blockchain like a google spreadsheet, except instead of being hosted on google’s servers, blockchains are maintained on a network of computers around the world. These computers (sometimes called miners or validators) are responsible for storing their own copies of the database, adding and verifying new entries, and protecting the database from hackers.

So, blockchains are… fancy google spreadsheets?

more or less! but there are at least three important conceptual differences.

first, a blockchain is decentralized. you don’t need a company like google to monitor it. all that work is done by computers on the network, using what’s called a consensus mechanism, basically a complicated algorithm that allows them to agree on what’s in a database without the need for a neutral arbiter. this makes blockchains more secure than traditional record-keeping systems, advocates believe, as no person or company can take down the blockchain or alter its contents, and anyone who attempts to hack or change the records in the ledger would have to go into many computers. simultaneously.

See also: SegWit vs Native SegWit (Bech32) : A Comprehensive Guide –

The second important feature of blockchains is that they are generally public and open source, meaning that unlike a google spreadsheet, anyone can inspect the code on a blockchain. public blocks or view a record of any transaction. (Private blockchains do exist, but they are less important than public ones.)

Third, blockchains are typically add-only and permanent, meaning that unlike a google spreadsheet, data that is added to a blockchain generally cannot be deleted or deleted. change after the fact.

understood. So, are blockchains public, permanent databases that no one owns?

You’re getting it!

Now remind me: how are blockchains related to cryptocurrencies?

blockchains didn’t really exist until 2009, when a pseudonymous programmer named satoshi nakamoto published the technical documentation for bitcoin, the first cryptocurrency.

Bitcoin used a blockchain to keep track of transactions. That was notable because, for the first time, it allowed people to send and receive money over the Internet without the need to involve a central authority, such as a bank, or an application such as PayPal or Venmo.

Many blockchains still transact cryptocurrencies, and according to coinmarketcap, there are now approximately 10,000 different cryptocurrencies. But many blockchains can also be used to store other types of information, including nfts, self-executing bits of code known as smart contracts, and entire applications, without the need for a central authority.

Okay, but can we back up for a second? Didn’t tech folks tell us years ago that cryptocurrencies were an exciting new form of money? and yet no one I know of pays rent or buys groceries in bitcoin. So were those people…wrong?

good question. it is true that today, hardly anyone pays for things in cryptocurrencies. In part, that’s because most merchants still don’t accept crypto payments, and high transaction fees can make it impractical to spend small amounts of crypto on everyday expenses. It’s also because popular cryptocurrencies like bitcoin and ether have historically risen in value, making it somewhat risky to use them for offline purchases. (Counterexamples are usually cited with pity, like the guy who, in 2010, bought two Papa John’s pizzas using bitcoin that were worth about $40 at the time, but would be worth about $400 million today.)

It’s also true that the value of cryptocurrencies has grown tremendously since the early days of bitcoin, even though they’re not most people’s everyday spending money.

Part of that growth is speculation – people buying crypto assets in hopes of selling them later. In part this is because the blockchains that have sprung up from bitcoin, such as ethereum and solana, have expanded what can be done with this technology.

And some cryptocurrency fans believe that the prices of cryptocurrencies like bitcoin will eventually stabilize, which could make them more useful as a means of payment.

What are the real uses of cryptocurrencies, beyond financial speculation?

Right now, many of the successful applications of crypto technology are in finance or finance-related fields. For example, people use crypto to send cross-border remittances to relatives abroad, and Wall Street banks use blockchains to settle transactions abroad.

The rise of cryptocurrencies has also led to an explosion of experiments outside of financial services. there are crypto social clubs, crypto video games, crypto restaurants, and even crypto-powered wireless networks.

These non-financial uses are still quite limited. But cryptocurrency fans often argue that the technology is still young and that the internet took decades to mature into what it is today. Investors are pouring billions of dollars into crypto startups because they believe that one day, blockchains will be used for all sorts of things: storing medical records, tracking music streaming rights, and even hosting new social media platforms. . and the crypto ecosystem is attracting tons of developers, an auspicious sign for any new technology.

I have heard people call cryptocurrencies a pyramid scheme or a ponzi scheme. what do they mean?

Some critics believe that cryptocurrency markets are fundamentally fraudulent, either because early investors get rich at the expense of late investors (a pyramid scheme) or because crypto projects lure unsuspecting investors with promises of sure returns and then crash once new money is obtained. stop entering (a ponzi scheme).

There are certainly many examples of pyramid and ponzi schemes within cryptocurrencies. they include onecoin, a fraudulent crypto operation that stole $4 billion from investors from 2014 to 2019; and virgil sigma fund, a $90 million crypto hedge fund managed by a 24-year-old investor who pleaded guilty to securities fraud and was sentenced to seven and a half years in prison.

but these cases are not usually what critics talk about. they generally argue that crypto itself is an exploitation scheme, with no real-world value.

And are they right?

Well, let’s try to understand the case they are presenting.

unlike buying shares in, say, apple, a purchase that (in theory at least) reflects a belief that apple’s underlying business is healthy, buying a cryptocurrency is more like betting on the success of an idea they say if people believe in bitcoin, they buy and bitcoin prices go up. if people stop believing in bitcoin, they sell and bitcoin prices go down.

Cryptocurrency owners therefore have a rational incentive to convince other people to buy. And if you don’t think cryptocurrency technology is inherently valuable, you might conclude that it all resembles a pyramid scheme, where you primarily make money by recruiting others to join.

I’m feeling a “but” coming.

but! Even though there are scams and fraud within cryptocurrencies, and crypto investors certainly like to try to recruit other people to buy, many investors will tell you that they will go in with their eyes wide open.

They believe that crypto technology is inherently valuable and that the ability to store information and value on a decentralized blockchain will be attractive to all kinds of people and businesses in the future. they would tell you that they are betting on the crypto product, not the crypto idea, which, on some level, is not that different from buying apple stock because you think the next iphone will be popular.

matt huang, a prominent investor, spoke for many crypto fans when he said on twitter: “crypto can look like a speculative casino from the outside. but that distracts many from the deeper truth: the casino is a trojan horse with a new financial system hidden inside it.”

You can argue with that position or discuss how much this “new financial system” is really worth. but crypto investors clearly believe it is worth something.

Is cryptography regulated?

just a little. In the United States, certain centralized crypto exchanges, such as Coinbase, are required to register as money transmitters and follow laws such as the Bank Secrecy Act, which requires them to collect certain information about their customers. Some countries have passed stricter regulations and others, like China, have banned cryptocurrency trading altogether.

but compared to the traditional financial system, crypto is very poorly regulated. There are few rules governing crypto assets such as “stablecoins” (coins whose value is pegged to government-backed currencies) or even clear guidance from the Internal Revenue Service on how certain crypto investments should be taxed. and certain areas of crypto, like defi (decentralized finance), are almost completely unregulated.

In part, that’s because it’s still early days and creating new rules takes time. but it is also a property of blockchain technology itself, much of which was designed to be difficult for governments to control.

This question comes from the (apparently crypto-curious) rapper cardi b: are cryptocurrencies going to replace the dollar?

sorry, cardi. The dollar is the world’s reserve currency, and dislodging it would be a huge and expensive project that probably won’t happen anytime soon. (To give just one small example of the enormity of the task: every financial contract denominated in dollars would have to be denominated again in bitcoin, ether, or some other cryptocurrency.)

There are also technical hurdles that cryptocurrencies must overcome if they are ever to displace government-issued currency. Today, the most popular blockchains, bitcoin and ethereum, are slow and inefficient compared to traditional payment networks. (The ethereum blockchain, for example, can process only about 15 transactions per second, while visa says it can process thousands of credit card transactions per second.)

and of course, for a cryptocurrency like bitcoin to replace the dollar, it must convince billions of people to use a currency that fluctuates wildly in value, is not backed by a government, and often cannot . be recovered if stolen.

what kind of people are investing in cryptocurrencies? is that all, to quote a recent episode of “curb your enthusiasm”, “nerds and nazis”?

It is difficult to say who is investing in cryptocurrencies, especially since much of the activity is carried out anonymously or under pseudonyms. but some surveys and studies have suggested that crypto is still dominated by wealthy white men.

gemini, a cryptocurrency exchange, estimated in a recent report that women made up only 26 percent of cryptocurrency investors. the average cryptocurrency owner, the group found, was a 38-year-old man earning roughly $111,000 a year.

See also: 10 Things You Didnt Know About Bitcoin

but cryptocurrency ownership appears to be diversifying. A 2021 Pew Research Center survey found that Asian, Black, and Latino adults were more likely to have used crypto than white adults. Cryptocurrency adoption is also growing outside of the United States, and some studies have suggested that cryptocurrency adoption is growing fastest in countries such as Vietnam, India, and Pakistan.

my colleague, tressie mcmillan cottom, has argued that cryptocurrencies, because they are based on permanent and irrefutable records of ownership of digital goods and currencies, are particularly attractive to people from marginalized groups, who may have been unjustly seized their property. of them in the past.

“If I live in a community where the police absolutely use eminent domain to claim my private property and I can’t do anything about it,” he wrote, “that sense of everyday helplessness would make the promise of blockchain sound pretty good. ”

That said, some recent studies have also found that a small number of people own the vast majority of crypto wealth, so it’s not necessarily an equal paradise.

And the extremists? Do you like cryptocurrencies?

some are. Because you can buy and sell cryptocurrency without using your name or having a bank account, cryptocurrency in its early days was a natural choice for people who had reason to avoid the traditional financial system. they included criminals, tax evaders, and people who bought and sold illicit goods. they also included political dissidents and extremists, some of whom had been kicked out of more mainstream payment services like paypal and patreon.

As a result of their timely entry into the cryptocurrency market, some extremists have become rich. A recent investigation by the Southern Poverty Law Center found that several prominent white supremacists have made hundreds of thousands or millions of dollars by investing in cryptocurrencies.

Of course, there are millions of cryptocurrency owners, the vast majority of whom are not white supremacists. and the same anonymity and censorship-resistance properties that make cryptocurrencies useful to white supremacists could also make them attractive, say, to Afghan citizens fleeing the Taliban. so labeling the entire crypto movement as an extremist group would be an exaggeration. Regardless, it’s safe to say that cryptocurrencies have become attractive to all sorts of people who would rather not deal (or cannot legally deal) with a traditional bank.

Another criticism I’ve heard is that cryptocurrencies are bad for the environment. is that true?

This is a real can of worms and one of the most frequent objections to cryptocurrencies.

Let’s start with what we know for sure. it is true that most of the crypto activity today takes place on blockchains that require large amounts of energy to store and verify transactions. these networks use a “proof-of-work” consensus mechanism, a process that has been likened to a global guessing game, played by computers competing to solve cryptographic puzzles to add new information to the database and earn a reward. change . Solving these puzzles requires powerful computers, which in turn use a lot of energy.

The bitcoin blockchain, for example, uses an estimated 200 terawatt-hours of energy per year, according to digiconomist, a website that tracks crypto energy use. That is comparable to the annual energy consumption of Thailand. and the carbon emissions associated with bitcoin have been estimated at approximately 100 megatons per year, which is comparable to the carbon footprint of the czech republic.

good heavens! How do crypto fans justify that kind of environmental impact?

Cryptocurrency advocates often dispute these statistics. They also argue that:

• Our existing financial system also uses a lot of energy, including millions of bank branches, ATMs that sit idle most of the day, gold mines, and other energy-intensive infrastructure.

• Many crypto mining computers already run on renewable energy sources or power that would otherwise go to waste.

• Most newer blockchains are built using consensus mechanisms that require much less energy than proof of work. (Ethereum, for example, is scheduled to switch to a new type of consensus mechanism called proof-of-stake sometime in 2022, which could reduce its power use by as much as 99.5 percent.)

Are those arguments valid?

in part. it’s true that most newer blockchains are designed in a way that requires considerably less energy than bitcoin, and that ethereum’s switch to a proof-of-stake consensus mechanism will greatly reduce its environmental footprint, if it happens .

but it’s also a bit convenient to divert attention away from bitcoin, which is still the most valuable cryptocurrency in the world. Bitcoin’s energy needs are not expected to decline significantly any time soon. And even if every bitcoin miner were to run entirely on renewable energy, which, to be clear, is not the case, there would still be an environmental cost associated with maintaining the blockchain.

In all, it is clear that cryptocurrencies as we know them today have a significant environmental impact, but it is difficult to measure exactly how significant. Many oft-cited statistics come from industry groups, and reliable, independent data and analysis are hard to come by.

But few cryptocurrency fans would argue that blockchains consume substantially more energy than a traditional centralized database, just like 100 refrigerators use more energy than a refrigerator. they simply argue that the environmental impact of cryptocurrencies will reduce over time and that the benefits of decentralization are worth the costs.

understood. and those benefits, again, are…

Some crypto advocates will tell you that the biggest benefit of decentralization is the ability to create virtual currencies, apps, and economies that are resistant to censorship and top-down control. (Imagine a version of Facebook, they will say, in which Mark Zuckerberg couldn’t unilaterally decide to kick people out.)

Others will say that the biggest advantage of decentralization is that it allows artists and creators to control their own economic destinies more directly by giving them a way (in the form of nfts and other crypto assets) to bypass platform gatekeepers like youtube and spotify and sell unique digital works directly to their fans.

Others will say that cryptocurrencies are more useful for people who do not live in countries with stable currencies or for dissident groups living under authoritarian regimes.

There are a million other hypothetical benefits of decentralization and crypto, some of which are realistic and some of which are probably not.

How are cryptocurrencies actually used? is it like sending a payment through paypal or venmo?

can be. The fastest way to get started with crypto is to set up an account with a crypto exchange like Coinbase, which can be linked to your bank account and convert your US dollars. dollars (or other government-issued currency) into cryptocurrencies.

but many cryptocurrency users prefer to set up their own “wallets”, secure places to store the cryptographic keys that unlock their digital assets.

Once you have some cryptocurrency in your wallet, the process can be quite simple: just type in the recipient’s crypto wallet address, pay a transaction fee (if applicable), and wait for the payment to clear.

Other types of crypto transactions, like buying and selling nfts, can be significantly more complicated, but the basic act of sending someone a payment usually takes only a few minutes.

I’m ready to dive into the rest of your explanations. But first, I have one last question about crypto culture: why is it so weird and insular?

This is perhaps the most frequently asked question about cryptocurrencies. people see their friends, coworkers, and family members plunge down the crypto rabbit hole and emerge days or weeks later with a new obsession, new internet friends, a bunch of new slang, and the seeming inability to talk about anything else . (there’s even a word for this: being “cryptopiled”). people who believe in cryptocurrencies tend to actually believe in them, to the point where they can appear to the outside world more like evangelists for a new religion than fanatics for a new technology. .

I was a religion reporter once, and I don’t think the comparison is entirely inappropriate. (It’s not necessarily a bad thing, either: many people find meaning and community and intellectual stimulation in religion.) -anonymous satoshi nakamoto), sacred texts (the bitcoin white paper), and rituals and rites to mark yourself as a believer, like tweeting “gm” (crypto-speak for “good morning”) to your fellow believers, or photoshopping laser eyes on your photo of profile.

It’s fun to laugh at the (often embarrassing) ways crypto fans try to entertain and inspire each other. but focusing too much on their behavior and customs can mean missing out on what is genuinely novel and, depending on where you feel, exciting or dangerous, about the technology itself. That’s why, when my friends ask me how to talk to their crypto-mad relatives, I advise them to start by trying to understand what gets them so excited in the first place.

dive deeper:

“what is the blockchain?” In this basic blockchain technology explainer, Mohit Mamoria discusses how blockchains work and the problems they aim to solve.

“Introduction to Blockchain and Money”, this youtube video, which explains the history and technical foundations of cryptocurrencies, is the first lecture of a course taught at m.i.t. in 2018 by Gary Gensler, who is now the head of the Securities and Exchange Commission. (the rest of the course is also on youtube and it is interesting to see it).

“a normie’s guide to becoming a crypto person” this new york magazine article by sara harrison is a 101 level guide to crypto culture, including a glossary of terms and explanations of the many crypto sub-communities.

“digital gold” nathaniel popper, my former colleague, offers a deep dive into the history of bitcoin and the origins of cryptoeconomics in his 2015 book.

See also: Crypto Payments – Energy Electronics LLC

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