One Hour Bitcoin:

A Quick, Easy-to-Understand Overview of Cryptocurrencies

By T.B. Holder
 Copyright 2018 - All Rights Reserved – T.B. Holder

ALL RIGHTS RESERVED. No part of this publication may be

reproduced or transmitted in any form whatsoever, electronic, or
mechanical, including photocopying, recording, or by any
informational storage or retrieval system without express written,
dated and signed permission from the author.
Table of Contents

INTRODUCTION:
THE BLOCKCHAIN: SIMPLY EXPLAINED
W ?
H D I W ?
W R ?

WHAT IS A BITCOIN?
T A AB
W W S M ?
T P B

LEVERAGING CRYPTO TO WIN FINANCIAL INDEPENDENCE

H M S Y I ?
W S Y B ?
T T N T T

THE PAST AND FUTURE OF BITCOIN

T H B
E E
B T Y

GETTING STARTED WITH BITCOIN

U W
S R C
H I M F C ?

DID YOU MISS THE BOAT?

Y ,Y M B
M Y D ’ M B

THE PITFALLS OF CRYPTO

S F
H F
H S S Y C

CONCLUSION:
USEFUL CRYPTO LINKS & FREE MONEY FOR YOU:
GLOSSARY OF COMMON CRYPTO TERMS AND REFERENCES:
MY TOP PICKS FOR 2018:
DID YOU ENJOY THIS BOOK?
 I :
Bitcoin, Ethereum, and cryptocurrency hold some very lofty ideals
(which you’ll learn about), but I have a fairly down-to-earth
perspective, and so in this book, I offer the essential knowledge you
need in order to leverage this awesome new technology into a big
pile of money. Sounds pretty good, right?
Well it definitely worked for me, so…yeah.
Listen, in 2009 you could buy a thousand Bitcoins for a dollar. In
2010, you could buy ten Bitcoins for a dollar. In 2018, you can buy
one Bitcoin for $16,000. So one dollar invested in Bitcoin in 2009
and forgotten for 9 years would net you 16 million dollars today.
How’s that for risk vs. reward?
I--like the vast majority of humans--vaguely recall reading something
about this new technology back in 2010 before casually dismissing it
as “nerd money” and shoving it to the place in my brain occupied by
Beanie Babies and 6th grade algebra. In other words: I never thought
about it again…that is until November 2013, when it hit $1,000 for
the first time and I—a lowly traveller at the time, short on cash and
hating my job—decided to pull out the old calculator and run some
numbers.
Here I was, little more than a glorified English teacher in Eastern
Europe, struggling for a way to pay school debts and break the
shackles of wage slavery, and I missed the boat. A twenty-dollar
investment a few years before would have set me up for life…and I
missed the boat. Facepalm? No. I wanted to throw myself from a
bridge.
But that didn’t stop me. I quickly took what little money I had and
bought two whole Bitcoins for $800 each…and thus began my
journey down the rabbit hole of crypto currency; a journey that has—
for better or for worse--pre-occupied me every single day for the past
four years, and continues to do so—even as a significantly wealthier
man…because there’s really more to this than just money; it’s
seriously a ground breaking new tech that is still in its infancy. But
that’s a different story.
Since the day when I bought my first Bitcoin, I’ve made myself a
boatload of cash---and I’d like to help you do the same; after all:
there’s plenty in it for everybody.
This book isn’t exhaustive. Indeed it will only take about an hour or
so to read. One Hour Bitcoin is a plain-language overview that will
give you everything you need to know about crypto in order to be a
savvy investor and hopefully make more cash than you’ve ever
seen.
 T B :S E

W ?

A Group of Transactions
Crypto works on the basis of publicly recorded transactions. A
blockchain processes transactions in groups, which are referred to
as “blocks”.
So a block is quite literally nothing more than a group of transactions
processed through the blockchain.
Of course it has some other properties as well…

It References the Previous Block

Every block has a number, and every block references the number of
the block before it. So block 123 references block 122, and block
122 references block 121.
 This makes the blocks
(groups of transactions) form a chain. Hence the term “blockchain.”

It’s a Public Ledger

A ledger—for the financially illiterate—is a book in which all of the
expenses and incomes are recorded. Businesses keep ledgers—a
record--of every penny they spend and receive, well at least good
businesses do.
On the blockchain, for a transaction to be “processed”—in
blockchain terms we call this a confirmation--it means that the
transaction is officially recorded on the public blockchain, visible for
the entire world to see and from that point unalterable.

So the confirmed transaction is recorded in something called a

“transaction hash”. This hash is a string of seemingly random letters
and numbers that can be decoded by the blockchain to show a
bunch of different information:
The block number that the transaction was included in
The sending address from which the Bitcoin was sent
The recipient address to which the Bitcoin was sent
Error messages
The transaction fee
And a number of other important data points…
 So the blockchain is
nothing but a really long list of transactions, numbered, organized,
and grouped together in groupings called “blocks.”
 H D I W ?
Mining & Staking
So who is processing confirming these transactions? Well there are
people (nerds, mostly)—called miners—who run the Bitcoin software
on their individual computer (or on large servers) that confirm the
transactions and put them into the next blocks.
Previously we mentioned a term called a “hash”. A hash is a string of
variables (letters and numbers) which can be decoded into readable
information. It’s a way to store more information in less space.
The miners—using the bitcoin program---use their computers to work
together and guess the hash variables. When it is guessed, then that
block is “mined” with a bunch of transactions included into it.
When the block is “mined” it is “processed”—that is published to the
public blockchain for all to see.

Rewards and Fees

But solving blocks takes a lot of computer power, and with it a lot of
computers and thus a lot of electricity (it wasn’t always this way—but
Bitcoin is designed in such a way that it gets harder to mine over
time[1]), and electricity can get expensive…so there needs to be an
incentive for these people to keep their computers running.
When a block is solved it generates a reward—Bitcoins! In the very
beginning, a single block yielded 50 bitcoins and could be mined by
your laptop—now the reward is 12.5 Bitcoins and it takes a
warehouse full of servers[2] to get those Bitcoins…and that’s a lot of
electricity. So because Bitcoins are more expensive to mine, they are
more expensive to buy.
But that’s not all! Miners also get the fees that users pay to send
their transaction, and a user can prioritize their transaction (to be
included in the soonest block) by offering to pay more for it and
setting a higher transaction price.
So the miners are encouraged to keep mining by earning Bitcoins
both in the form of block rewards and transaction fees.

What is a Node?
A node is a server or hard drive that has saved (and updates in real-
time) the entire blockchain. This is extremely important because it’s
what makes the blockchain “decentralized” and not dependent on
any single entity (like a company or government).
In the same way that the quantity of cell phone towers strengthen
phone signals, the more nodes that hold the blockchain, the more
reliable the blockchain is.
Anyone can run a node on their computer, but it will take up a few
gigabytes of space. Since anyone can run a node, then no one can
shut down the blockchain, and no one can change the blockchain
without getting the consensus of all (or at least a convincing majority)
of the nodes to start running *their* blockchain.
 W R ?
It’s Public
Meaning anyone, anywhere, at any time can see and view any
record that they want. They can see when a billion dollars in Bitcoin
was transferred from address A to address B, and then follow it from
B to C and so on.
Most companies and all governments—despite their declared
intentions towards ‘transparency’--keep their accounting books (their
ledgers) to be very secret.
Whether for reasons of convenience or something more nefarious,
governments do not have any interest in showing their people
exactly how much money is spent on everything—nor companies
wish for their shareholders to dig into their documentation.

It’s “Immutable”
That is, it’s unchangeable without a consensus of the majority.
So let’s say I come along with a hacked version of the blockchain
that gives me a billion bitcoins or maybe alters some questionable
transactions. My billion bitcoins will only be visible on my chain and
anyone who adopts it.
If there are a hundred nodes, then I need to convince a large portion
of them to start running my blockchain so that my bitcoins have any
real value to anyone. But of course no one will do this unless there’s
good reason for them to give me a billion bitcoins. Maybe fifty-one
people you could convince to adopt your chain by promising them a
pay off or something similar, but what about fifty-one thousand? Or
million? That would be significantly more difficult.
This is also why the blockchain is untouchable by governments:
there are just too many nodes to shut down all of them or even a
majority of them. If Uncle Sam wanted to own the Blockchain, he’d
have to release his own blockchain and somehow convince the vast
majority of nodes to adopt it. This makes the blockchain a very
powerful tool “of the people.”

Utopia Through Technology!

But there’s another piece of the Bitcoin puzzle that makes it so
revolutionary: in its simplest form, Bitcoin is actually money. It cannot
print more than everyone agrees for the protocol to print, and it can’t
just willy-nilly grant money to special parties (remember how our
nodes require majorities for people to reflect changes in the
blockchain?).
But can’t governments just not accept Bitcoin and declare it to
not be worth anything? Of course they can…but so what?
Because if Joe the baker and John the mechanic decide that they’ll
take Bitcoin in exchange for a loaf of bread or car repairs, then
literally no one can stop them from doing that! And since *all* money
is just a thing of agreed-upon value, then no centralized entity has
any real control over Bitcoin.
 W B ?
T A AB
It’s a String that Represents a Value
We refer to Bitcoins as coins and tokens because we really just need
a way for people to wrap their head around it.
A Bitcoin is actually just a long string of letters and numbers which
make sense in the blockchain. Much like a one-dollar bill has a serial
number, so a Bitcoin is just the “serial number” and “Bitcoin” is the
term we use to refer to it in a way that makes sense to humans.

It Cannot Exist Outside of a Wallet

When you send a transaction, you can only send from one wallet
address to another; there is no in-between. Say you’re sending 2
Bitcoins from “abc” address to “xyz” address.
Your transaction, when it posts to the blockchain isn’t really saying,
“send 2 Bitcoins to xyz address”, it’s saying “okay abc address now
has 2 Bitcoins less than it did and xyz address now has 2 Bitcoins
more.”
The blockchain is holding and dictating the value of your wallet, in
terms of “Bitcoins.”

Its Value is Recorded on the Blockchain

Normally we think of money in terms of a thing that we possess and
send places. In other words, it is located in point A or point B,
whether that point is our wallet, pocket, or bank account and then we
send it to a point B—whether we physically hand it to someone else
or organize an ACH transfer.
With Bitcoin, the Blockchain is actually dictating how much value a
wallet holds at a given time according to the rules that are coded into
its programming.
Although we think of the Blockchain as something that our wallet
sends through, it is actually the thing that is telling our wallet how
much is in it.
 W W S M ?
The Nature of All Money
But Bitcoin isn’t backed by anything, so how can it have value?
Money is nothing more than a symbol that represents value.
Whether it’s coins, pieces of paper, precious metals, or a digital
number in your bank account: unless you can eat it, drink it, fire it, or
wear it—then it doesn’t hold any real value…it’s just an illusion that
our society has come to accept in order to function on the grand
scale that it does.
Gold is worthless when you’re starving or freezing in the Alaskan
wilderness…come to think of it, so is the $2000 per ounce of it. In
such a situation, isn’t a loaf of bread, a juicy salmon, and a book of
matches worth far more than six kilos of gold?
Do you know what really gives gold value? You and I! Remember
our earlier discussion about John the Baker and Joe Mechanic in the
previous chapter?
They and their skills are the real value, but they accept the value of
money because it is convenient and (they believe) beneficial for
them to trust the government to mediate exchange between
parties…so they will accept the U.S. government’s paper symbol of
money: the dollar.

What Gives Bitcoin Value?

You and I do!
Or more accurately: the people who trade it on the exchanges. They
determine how much they are willing to buy and sell a Bitcoin for.
But with Bitcoin, there’s no government involved—and because of its
code, there can’t be a government involved. In Bitcoin: the nodes are
the government—and since anyone can operate a node, doesn’t that
make the people the government of Bitcoin? In a certain sense, the
Bitcoin protocol represents a very practical form of democracy.

But is it Really Worth $16,000?

Maybe?! No? Yes? Nobody knows!

Bitcoin is really only worth what people are willing to pay for it. But
the better question here is: why are people willing to pay so much
for it?

Well if you’ve understood the previous chapters then you should

really start to appreciate how remarkable this technology actually is:
Money is no longer something created and managed solely by the
government, but it is something that can be created and managed
through a computer program whose rules of production cannot be
altered except by a large majority of the people who agree it has any
value in the first place.

It’s like saying that everyone who accepts dollars—purely by virtue of

continuing to accept them--has a concrete voice in how those dollars
can be created and manipulated.

Now Bitcoin is only the start; right now very clever people are
beginning to show us ways to use this kind of technology to create
very complex systems of operations and interesting services…it’s
starting to look like a NEW kind of Internet!

But why are people paying $16,000 per Bitcoin? Because they are
betting that the New Internet—if it becomes everything we think it
can be--will be worth WAY more than $16k/share.

At the end of the day, it’s pure speculation. People are buying at
today’s prices because they think (and hope) that very Bitcoin will be
worth 10 times—or a hundred times—as much in a few months or
years.
Frankly speaking, this kind of speculation is the best kind of
speculation because this technology is something of immeasurable
value.

It’s exactly the same now as it was in 2009 and then again in 2013:
what people are calling “speculation” today will be called “foresight”
in another few years.
 T P B
It Has No One to Teach it to Fly
Bitcoin, for all we know, was founded and created by a Pseudonym:
Satoshi Nakamoto, and laid out in what has become the Holy
Scriptures of Bitcoin: The Bitcoin White Paper.
The White Paper lays out a vision for a new kind of money that can
be controlled only by the people. It is completely decentralized and
allows people to “become their own banks.”
On the surface this sounds like a wonderful ideal, but nascent
technologies—just like baby birds—need someone to teach them to
fly before they can actually take off…but when you have a bunch of
people (decentralized, pure democracy) arguing about which wing to
flap first, baby bird will fall right out of the tree!
Have you ever been in a kitchen with more than one head cook?
Everybody has their own opinion of the best way to spice the sauce,
but when people can’t agree then you get a lot of fighting and some
very burnt food (if you get fed at all). Such as it is with Bitcoin.
Everyone has a different vision for what will solve problems and how
things “should” be, so it often turns into an endless battle to even
convince a majority, let alone everybody. This is why big companies
have advisors and boards of directors…to weigh the pros and cons
of a particular path and make difficult decisions. If they let everyone
in the company weigh in, then all progress freezes and the company
dies.
Satoshi, it seems, was a bit too idealistic and didn’t realize that
Bitcoin’s progress could freeze as a result of tight control.

Bitcoin has Become Centralized and Expensive

The Bitcoin Foundation is a group of developers that have committed
their efforts to the development and maintenance of Bitcoin in its
early years. Subsequently they have become a leading voice in the
community with their opinions and campaigns holding a great deal of
influence over most Bitcoin enthusiasts. They also have public
channels with large enough of an audience (Twitter, mailing lists,
forums, etc.) that they can make their opinions more greatly heard.
What’s more, mining Bitcoin has gotten more difficult—this is okay,
because it should do that—but for a computer, this means it takes
longer and requires more power—which means more electricity. So
Bitcoin’s mining (‘Proof of Work’) system naturally causes more
mining to happen in places where electricity is cheap. So it shouldn’t
come as much surprise that the vast majority of miners are located in
China.

It’s Full of In-Fighting and Manipulation

The White Paper may be the “Bible of Bitcoin”, but Satoshi
Nakamoto is not God—no matter which way you twist it—and there
are things he did not foresee, or did not necessarily lay out a plan
for. His ideals for a democratically governed development of Bitcoin
may have been a bit too pie-in-the-sky[3] for human nature to handle.
Right now Bitcoin has become very slow and very expensive
because of a debate about the size of blocks (how many
transactions a single block can hold).
While you can still spend a few cents to send a Bitcoin transaction—
such a fee will put it in line for a few days (if not weeks).
Alternatively, you can pay $20.00 to get it sent almost immediately.
But no one wants to spend $20.00 to send $50.00. That just doesn’t
make fiscal sense for anyone, and so suddenly Bitcoin has become
unaffordable. After all, why not just use your credit or debit card? It’s
far more convenient and (currently) far safer!
Well the long and short of it is that this problem could be overcome
by increasing the size of the block, which could be accomplished
with the change of a single line of code. That’s it! A single line. But
infighting in the Bitcoin Foundation and collusion with Miners has
resulted in a lot of infighting, censorship in the community, and a
whole bunch of Bitcoin forks!
This single question has paralyzed Bitcoin’s development for more
than four years now—an eternity in Internet Time! Satoshi Nakamoto
—wherever he is—is probably reflecting on the words of Winston
Churchill: “The best argument against democracy is a five-minute
conversation with the average voter.”
 L C W
F I
H M S Y I ?
How Much I Started with…
I jumped on the Bitcoin train in 2013, when it was running up to
$1200 for the first time ever. It was an exciting time and I was kicking
myself for not paying attention to this new technology back when I
could have bought a thousand for a few dollars.
I bought my first two Bitcoins for $800 each, and then watched as it
jumped to $1200 almost overnight. When it dipped down to $800
again, I bought two more. So my original investment was about
$3600.
Today my portfolio is worth significantly more than that[4]. It has
afforded me a degree of financial independence and I have cashed
out a “modest” sum to live on while I let my portfolio grow further.
This is indeed the excitement of crypto—and the stage of hysteria
that we’re currently witnessing! In those days, I feared it might be too
late, that I missed the boat on Bitcoin--but there is still so much
growth to be had in this sphere.

How Much My Friends Have Started with…

When Bitcoin crossed the $10,000 mark a little over four years after I
bought my first Bitcoins, I messaged a friend as I knew he was also
a crypto-enthusiast. As it turns out, he had become a “millionaire” on
that very day! His initial investment in Bitcoin was about $4,000.00.
Another friend only discovered crypto this past summer (about 6
months before my writing this). He invested $1200 which he quickly
cashed out once he turned a modest profit, leaving the rest in the
markets to “play” with. His portfolio is now worth about $35,000!
He’s not rich by any means—but that’s a lot of “free” money! Who
knows? Maybe for you it’s your student loans, maybe it’s a down
payment on your first house, or paying off long-standing credit card
debt. There are a hundred different ways that that “small” sum of
money could change your life.

How Much You Should Start With…

There is a mantra in the crypto (and investing community): Never
invest more than you can afford to lose.

I used to think that that meant to not take debt, or be homeless

because of speculative investments…but that’s not what it means.

What it means is that you should invest a sum small enough that you
don’t panic and sell on every dip, or freak out and buy back in on
every bounce…and that’s the way the market works and the way a
lot of people whittle away their entire portfolios (or savings in some
cases).

Your job is to regard your investment with confidence. This means

understanding the technology, because only your deep confidence in
the team and the project will give you the courage to hold your
investment firm.

Holding is one of the best ways to win the crypto game: you select
your investment with care and hold until it reaches your targets.
Keep in mind that this is the voice of experience writing: I know that
my portfolio is no small sum, but it would be worth at least 6 times
more if I never tried to trade.
 W S Y B ?
Types of Tokens[5]
Coins: Refer to projects that have their own Blockchains. These
would be projects like Bitcoin, Ethereum, IOTA, Raiblocks, Ripple,
and Monero to name a few.[6]
Utility Tokens: Are how we generally refer to coins that will be
required to use a developing product. Such Tokens will typically
utilize/be built upon an existing blockchain (as opposed to having its
own). These will be projects like Golem, Aragon, iExec, 0x,
OmiseGo, and many others.
Investment Tokens: Many projects hold a more practical view of the
blockchain and focus on investments and trading. Many of these
tokens offer their token holders dividends based on their company’s
profits, as well as the growth of the token value. In some cases they
even represent an actual share in the company, in other cases they
are building tools related to trading crypto currencies. Examples of
such projects are Astronaut Capital, Iconomi, CoinDash, and
Cindicator.
Blockchain Interoperability Tokens: These projects recognize that
one day we will live in a multi-blockchain world and so they aim to
create protocols and tools that will allow users to seamlessly operate
across blockchains. Imagine not being able to send an email from an
iPhone to an Android device…frustrating right? These guys aim to
make Blockchains completely interoperable. Cosmos and Polkadot
are two of the biggest names focusing on this niche.

Pump & Dump vs. Long Term

The birth of the ICO (Initial Coin Offering) has created a Niagara
Falls of money for tech dreamers and would-be entrepreneurs.
Many of these guys have the guts and glitter to make a dent in this
space, but many have little more than a shoddily-written white paper
and a WordPress theme.
What’s more, crypto is a tiny market in the world of finance…which
means a lot of manipulation. There are many coins out there who
have raised millions within a few minutes of an ICO, and their token’s
price jumps 10x in a few days…but in the end they deliver nothing
and the price slumps to lower than its ICO price.
Poorly thought-out projects and exchanges being paid to manipulate
trading values create the perfect environment to pump a coin and
then dump it when it hits the pre-determined targets, leaving a lot of
upset bag holders.[7]

How do I Know What to Buy?

Crypto is really the Wild West of finance[8] and the guys orchestrating
these pump-and-dumps aren’t even breaking any laws doing it;
they’re just not being very nice. But can you blame them? If you had
the opportunity for a quick million, wouldn’t you take it?

Still, it’s your job to DYOR: Do Your Own Research. Ask any investor
in Silicon Valley and they will tell you that the single factor which
counts the most is the team. You’re not investing in an idea or even
a product, you’re investing in the team.

But the team isn’t everything, there are a great deal of other factors
that you need to account for before investing.

So when you hear about an exciting new ICO on Reddit or see a

pay-per-click add on CoinMarketCap, use the following checklist for
your research:
Read the Whitepaper. (Does the idea make sense? Is it even
possible? Did they copy & paste from someone else? Is this
something you personally see value in?)
 Does the team have a working product or prototype (often
called a ‘minimum viable product’ or MVP), or is it just an
idea scratched on a nicely formatted PDF?
Research their team. (Review their linkedin profiles, their
work histories. Were previous projects successful? Who is
vouching for them? Do they even exist?[9] Can you personally
contact any of their previous employers?)
Gather community consensus. (Review crypto subreddits,
the project’s subreddit, slack channel, join their telegram and
talk with the team if possible).
Are they having a pre-sale? If so, what size? A lot of times a
pre-sale indicates that large, preliminary investors got a
sizeable bonus…and they’ll dump on your poor head as soon
as it’s released onto exchanges, meaning you can probably
buy significantly cheaper after the ICO.
What is the token distribution? What percent does the team
control? What percent goes to large investors,
friends/advisors? What percent is being sold (keep in mind
that the crowd is paying for all of the tokens—the team and
advisors get theirs for free).
What is the overall token supply? (Some people believe this
can be an indicator of the maximum future token value).
Partnerships: do they have partnerships with any big names?
Is anyone willing to put their reputation on the line for
endorsing the project?
Are the teams’ token shares locked for a certain time period?
(What will prevent the team from dumping their “free” tokens
on your head as soon as the exchanges list them?). A good
vesting period for the team and advisors is at least six
months---but preferably a couple years.

Now as I said before, Crypto is the Wild West, and many projects
who would hit every item on the above checklist result in a token
whose value drops below ICO price for months before rising.

Other projects with various red flags will go 5x or 10x the ICO price
almost immediately—and stay there indefinitely. Sometimes it’s just a
guessing game, but the best you can do is research all you can and
maintain confidence in your investment so that—even if it does drop
below ICO price—you can be certain of positive returns in the long
run.

In the Autumn of 2017 I invested in four ICOs, and every single one
dropped to about 50% of ICO price immediately upon release to
exchanges. Every. Single. One. What rotten luck?! Well after holding
steadily with much anticipation for about two months, now every
single one of them is above ICO price—some as many as 6x.
 T T N T T
How to Trade Correctly
When you dive into the world of crypto, you will see tokens that are
flying to the moon every day. They will go 100%, 200%, 20%, and
everywhere in between. You will be very tempted to flip your stack
and try to earn a few more bucks on top of what you already have.
The general rule of thumb is that if you’re not already in the token
when the pump begins, then you’ve most likely missed it—so you’ll
buy the top and sell the bottom (because you don’t believe in the
project long term) and end up with far less than you started with.

What is a “hodler”?
You’ll often see the term “hodling” or “hodler” thrown around. It’s a
type-o that became a community term, from “holder” and “holding.”
As in: “don’t panic and sell, hold and it will pay off in the long run. Be
a holder.”

You Probably Suck at Trading

Unless you’re an experienced banker, you probably suck at trading
(many of them do too). You will buy high and sell low until you’re left
with a fraction of what you once had.
Remember my wisdom: I’d have 6x the size of my portfolio if I never
traded. Remember my millionaire friend I mentioned? The amount of
Bitcoins he holds is only one fourth of his original stack, all because
he tried to gain by trading.
If you’re a stubborn ass and insist on trading, then do it with no more
than 5% of your stack…and in a world of 100% gains in a day, aim
for 5% or 10%. Never trade against the trend (i.e. when you see
something on a multi-day sprint, get in, set your modest price target
and get out—you can always jump in later if it continues to go up).
 T P F B
T H B
Satoshi Nakamoto
Bitcoin White Paper was released as an open-source software in
2009 by the pseudonym of Satoshi Nakamoto. Allegedly he owns
210,000 Bitcoins (1% of all Bitcoins ever)…but no one knows who he
is.
A snarky reporter once claimed that she found him, but it wasn’t
really him—at least nobody actually thinks so. Anyhow, he set
Bitcoin lose on the tech nerds of Silicon Valley and has since been
secretly watching it all unfold from a distance.

Mount Gox and Other Disasters

In November 2013, Bitcoin hit the unfathomable price of $1200.
Considering that in 2009 it traded for 1,000 BTC for a single dollar,
there were many newly minted millionaires (many who had long
forgotten that they even owned any Bitcoin) creating a frenzy for the
news media.
In the first quarter of 2014, Mount Gox[10]—the most prominent
Bitcoin exchange at the time—declared insolvency. Many people lost
their life savings and a man named Mark Karpeles decided he would
drink Star Bucks dessert drinks with little remorse.
There have been some claims from Mount Gox that have been
honored, but many people are still in limbo—never knowing whether
their lost Bitcoin will ever be returned to them. As it turns out, Mt.
Gox was using a trading bot to falsely inflate the price of Bitcoin
(dubbed “Willy Bot”)—which drove it to its $1200 value at the time.
It is largely suspected that this bot manipulation was a way for
Karpeles and Mt. Gox to hide their insolvency by selling their own
Bitcoin for very high prices.

A Tale of Three Coins

The world is built in iterations, and humanity reaches new heights by
standing on the shoulders of giants.

Blockchain technology was recognized as so powerful (and

profitable) that it ushered in a wave of copycats. The original thinker
had done the hard work, and since the tech was open source, loads
of programmers jumped on the train to copy and “improve” the
technology.

Little tweaks and twists resulted in dozens of new coins, each with
their own Blockchain. Doge Coin was founded on the premise of a
silly meme, and made their founders extraordinarily wealthy, but in
four years it has grown to little more than a penny in value and left a
lot of unhappy bag holders.

FeatherCoin was bounced around a lot back when the blockchain

was still a newly coined term—now it has ceased to exist almost
entirely. There are hundreds of examples of coins just like it.

Bitcoin and its many copies—these were the first generation of

Blockchain.

Now, as Decentralized Applications begin to introduce working

products to users, we enter the third generation of Blockchain.

…so what was the second generation? Smart Contracts, and the
platforms on which the applications will be built…enter Ethereum.
 E E
Why is Ethereum Better than Bitcoin?
Because Bitcoin is a protocol of digital money; it is The Fed of the
People and it is all laws surrounding the production of money. It is
brilliant and revolutionary—but it is only money.
Ethereum is a protocol that allows you to build applications on top of
the blockchain. Ethereum is the operating system and the
programming language, and its applications are what make it useful.
To use the metaphor of your iPhone: Ethereum is like the
programming language and the app store which will allow apps to be
created and used on the blockchain.
Bitcoin’s functional scope is limited, but the benefits of Ethereum
extend beyond its functionality in even the most basic ways. For one
thing, Ethereum can process significantly more transactions than
Bitcoin for a tiny fraction of the cost of Bitcoin transactions.
I attribute much of Ethereum’s success to the leadership of the
Ethereum Foundation (EF)—the creators and “owners” of the
Ethereum protocol.
One day, just like Bitcoin, the EF envisions an Ethereum protocol
that is 100% decentralized, but unlike Bitcoin, they understand the
importance of strong leadership in the early days of the technology.
Many decisions need to be made as this tech finds its feet, and the
best way to do that is for a small group of experts to make those
decisions. Under the leadership of Vitalik Buterin and the other
members of the EF, Ethereum is able to grow under the care of its
creators until it’s ready to fly on its own.
Ethereum has a designated roadmap to take the protocol to “flight
ready” stage, and an estimated timeline of its implementation. Pure
democracy is anarchy—and anarchy leads only to chaos. But a
carefully protected and thoughtfully parented democracy can
accomplish unbelievable things.

What is a “dapp”?

“Dapp” is shorthand for “Decentralized Application.” Currently it is

used to refer to any application that is built on the Ethereum
Blockchain; but ultimately it will be used to refer to applications built
on other blockchains as well.

A “Dapp” is a tool used to give practical blockchain utility to the

everyday user…much like Skype allows you to make free phone
calls and Angry Birds provides hours of entertainment. If everything
works out correctly, then 99% of the Internet 3.0 Users will be using
blockchains without even knowing it!

For example, dapps are being created that allow organizations to

keep their management data on the blockchain, others that facilitate
logistical operations—like the logging and tracking of
packages/deliveries on the blockchain; others work with book-
keeping; others still are working to make gold completely digitally
represented.

In 1994, people found it difficult to imagine a world like today’s

Internet. eBooks, online courses, free video/audio publishing,
shopping: these everyday aspects of our modern life were once
ridiculed as ridiculous pipedreams by many very educated skeptics.

The examples of the dapps we have today are just the beginning of
a blockchain-powered world and probably won’t blow anybody’s
mind. But they’re working to form the infrastructure of a
superstructure that will alter the direction of technology—and the
world—for many years to come!
What is an ICO?
ICO stands for “Initial Coin Offering.”

In today’s economy, when a company gets big enough they decide

they want to “go public.” So they divide their company into shares—
or stocks—and sell them to the public. This is called an IPO—an
“Initial Public Offering.”

In this case, the public would throw money at the business in hopes
that the shares will one day be worth significantly more than the
buying price. So people begin to trade them and sell them back and
forth, and so we have the Stock Market.

The IPO is a system that allows companies to receive very large

funding for further growth and development of their company from
millions of small contributors. This is usually long after institutional
investors have contributed very large sums of their own money into
the company.

In an ICO, instead of offering stocks or shares, a new blockchain

company will offer their own coin (or token). This coin may be
required to use the product itself, or it may be a speculative tool and
represent a share in the company.[11]

It usually works like this: some guys get together with their
blockchain-related idea, create a whitepaper and a website, and stir
up some hype. They then use their ICO to raise the funds they need
to build their project.

After the ICO, the coin usually gets released to exchanges and
becomes tradeable where the coin either goes up or down in price.

This is both revolutionary and really scary. In the world of technology

start-ups and IPOs, teams had to prove their worth before they could
raise tens of millions of dollars from investors. They needed to have
at least a semi-working product, demonstrated revenue, and some
clients before they would see any money—usually at the price of
years of sixteen-hour work days and many sleepless nights.

The ICO allows companies to raise tens of millions almost instantly

from the crowd, with little or no work involved at all. This is great for
many teams, as it guarantees them the funds to see their project
through to the bitter end—but it also attracts a lot of scammers and
amateurs.

Many ICO projects have earned their investors significant returns,

and that’s great for little guys like you and me who wish to break into
the investment world! We are now free to participate with even tiny
amounts of capital (like $50 or $100)—whereas trading in the stock
market might cost us at least that much just in fees to open an
account or execute a trade.

But it also means that lots of people are going to get burned; as
many start-ups fail and so will lots of Blockchain start-ups as well. So
research carefully before making a decision to invest in a particular
ICO, use the checklist in the previous chapter as a starting point to
guide you through your due diligence steps.
 B T Y
The Many Deaths of Bitcoin
According to the main stream media (New York Times, CNN Money,
CNBC, Wall Street Journey, Reuters, etc.), Bitcoin has “died” well
over two hundred times.
In fact, if you’re ever up for a lark, you can Google the “Bitcoin
Obituaries” website and take a look.
Bitcoin “died” when it crashed from $1.00 to $.01, it “died” when it
crashed from $10.00 to $1.00, it was declared deceased when it
crashed from $50 to $2, and then again from $1000 to $150. Bitcoin
will keep “dying” at higher and higher prices, until….who knows?

Is Bitcoin (and Crypto) a Bubble?

A lot of people compare crypto to “Tulip Mania” in Holland a few
centuries ago, or the Beanie Baby epidemic from the 90s: these
reference hysterical times when people were paying extraordinary
prices for silly things.
Well as history will tell you, one day—that only very few can predict--
the bubble pops and the people at the top cash out and sell
everything for super cheap, and there are no more buyers for the
rest.
Many people are left holding their bag open to catch the falling stars,
thinking that they’ll be able to resell higher—but that day never
comes. Tulips become less interesting and nobody cares about
Beanie Babies anymore (did they ever?)…they never get a return on
their investment.
Bitcoin is indeed in a bubble. But the difference between Bitcoin and
Beanie Babies is that this is how Bitcoin grows…in a cycle of
bubbles. Each one breaks higher than the last and crashes to a price
significantly higher than where it started before the previous bubble.

It kind of works like this:

1. Bitcoin price starts to rise
2. Media begins to report on this exciting new price rise
3. The public starts to stir and jump in on the new
investment
4. Bitcoin reaches a crazy new height in terms of price
5. The bubble “pops” and Bitcoin crashes down much lower
than its new height, but higher than it was before.
6. A long period of investor disillusionment comes in the
form of a bear market.
7. After a time the price starts to rise again.
8. Repeat.

So yes, Bitcoin is indeed in a bubble—but it’s been in many bubbles

and will continue to be in many more bubbles, but the question is
what will the price be when the final bubble actually pops? Will it be
$500k per Bitcoin? $1,000,000 per Bitcoin? Or maybe just $1.00 per
Bitcoin?
Nobody knows—although a lot of people pretend they do.
Bitcoin and the Walking Dead
I am personally of the opinion that in the near future, Bitcoin will be
overtaken by other crypto--both in terms of overall usage and actual
price.

Bitcoin has long sailed on the winds of “first mover advantage” it’s
the first one out there—the original—the biggest gains and the
greatest price so far. It has a dedicated (almost cultish) community of
followers…yet for all of this and it’s amazing technology, it has
ceased to develop.

As I have outlined in previous chapters, its infighting and

manipulation (I believe) will ultimately kill it. Maybe it will always still
be around, traded at various prices, but I believe that Ethereum will
overtake it in both price, utility, and further development.

Bitcoin is still moving, but it’s just a dead coin walking.

 G S B
U W
What Wallet Do I Need?
You can buy any fraction of a Bitcoin (or any crypto for that matter).
The smallest amount of Bitcoin you can currently buy is called a
“Satoshi” which is 0.00000001 Bitcoin (or $0.00016 cents).
As I’ve said before, Bitcoin (or any crypto) doesn’t actually exist
outside of a wallet. You can’t just have a “token”, you can only have
the private keys to a wallet address to which the Blockchain declares
there are tokens.
The general rule of thumb is that every blockchain token requires its
own wallet. That is, if your coin has its own blockchain, then it also
has its own wallet software.
If you hold Ripple, you need to have a Ripple wallet. If you hold
Bitcoin then you need to have a Bitcoin wallet. If you hold Ethereum,
then you need to have an Ethereum wallet.
The appendix at the end of this book has a number of useful links
and resources for finding information about each respective wallet
software.

JSON files, Passwords, and private keys?

Every wallet consists of two things:
1) a public address
2) a private key
If you do not own the private key to the address, then you do
not own the coins. This is extremely important to understand. Think
of the private key to your address as the ultimate password—if it
were part of your bank account, it would be like your signature, photo
ID, voice confirmation, and PIN code—all in one. No one would be
able to verify that the holder of that password wasn’t you.
So it is with your private key. The private key is irrevocably linked to
the wallet’s public address and unlike a password, you do not
choose it and it cannot be changed. Anyone who has your private
key can send your coins anywhere they please and you cannot get
them back.
This is the single most important part of safeguarding your digital
money. Store your private key, store back-ups of your private key,
and store them off of your computer where hackers can’t get them—
like on a flash drive.
Once your wallet is installed, you may also have the option to save
the “JSON” file. JSON is just a file type and it’s not really that
important that you know what “JSON” is, but when setting up your
wallet you may be prompted with the ability to create a password.
This password is used to protect the JSON file, and the JSON file
contains a complete back up of your wallet data. So let’s say your
computer dies on you with your Bitcoin Wallet. Good news! You
backed up your JSON file on a separate flash drive—so you can just
install the wallet software on another computer and upload the JSON
file and you’re back in business!
Backing up your private keys and your JSON file are SUPER,
MEGA, IMPORTANT. They will literally keep you from losing
everything you have.

ERC-20 Wallets
Whereas most wallets can only store one type of coin in them, the
Ethereum wallets support a token protocol known as ERC-20.
This means that you can hold dozens of different tokens in a single
wallet address as long as they are built on the Ethereum
blockchain.

My Ether Wallet provides a convenient way to generate an Ethereum

address with the ability to immediately download the JSON file and
copy the private keys. Their software also supports the access of
multiple ERC-20 tokens and adding custom tokens as well, so you
can quickly access all of your Ethereum tokens to send and receive
anywhere online simply through: www.myetherwallet.com.

NOTE: Phishing is a very common scam in crypto, so you need to

be careful and make sure that you are on the correct page. NEVER
try to locate a wallet or exchange’s website through Google, as these
scammers will pay for ads that direct you to a site which looks and
feels EXACTLY like the actual site, but when you log in with your
password or private keys, then it initiates a script that immediately
steals all of your coins.
 S R C
QR Codes

A QR code is a basic checkerboard-looking icon

that has the pixels arranged in a unique way to represent some basic
information.

Above is an example of a QR code from an M&Ms advertisement. It

most likely will lead the user to the M&Ms website, to a particular
page. So all those little pixels really represent a fairly small amount
of data.
In the case of crypto, QR codes are used to represent the public
address for sending and receiving tokens. So when you open up
wallet software on your phone, you can quickly send to a friend by
scanning their QR code, or vise-versa, you can receive funds when
they scan yours.

Public Addresses & Private Keys

The public address is the address to which people should send
funds to you (or you send to them). You can view the public
addresses on sites called “blockchain explorers” which allow you to
look up a particular address and see the funds it holds at any given
moment, along with a complete history of all transactions to and from
it.
What Happens if I Send My Crypto to the Wrong Address?
It is gone forever.

More specifically: if you send it to an address for which you do not

own the private keys, then it is gone forever.

The power of Bitcoin offers people the freedom to “be their own
bank”—holding, sending, and receiving money anywhere at any
time. But with this power comes a great deal of danger as well.

There is no one to restore your funds if they are stolen, no one to

reverse a transaction that was sent to the wrong person, no one to
fix mistakes—it’s decentralized, so no one can do it—even if they
wanted to.
 H I M F C ?
What Crypto Should I Buy?
You need to buy Ethereum or Bitcoin first because you can only buy
most other cryptos or invest in ICOs only using Ethereum or Bitcoin.
Once you have some Bitcoin or Ethereum, then you can invest in a
host of other tokens and store them in their respective wallets.
You can buy as little as .0000000001 Bitcoin/Ethereum token (a
couple cents) or as many as you can afford. Crypto currencies are
almost infinitely divisible, so you can own and use tiny fractions of
them.

Where Do I Buy My First Crypto?

If you are a US, Canadian, or a United Kingdom resident, then you
can and should use https://www.coinbase.com.[12]
Coinbase is by far the most reputable “Bitcoin bank” and is even
FDIC insured for up to $200,000.00 per user. There you can buy
Bitcoin, Litecoin, Bitcoin Cash, and Ethereum directly. You can then
send those tokens to exchanges and buy other tokens.
However if Coinbase is not an option in your country, then most
exchanges offer a “fiat on-ramp” in which you can direct deposit
Euros, Rubles, Dollars, or other currency from your bank account
into the exchange, where you can buy other tokens.
For members of the Commonwealth of Independent States (former
Soviet Union countries), you can use a site called www.cex.io, here
you can buy with a credit card for a 3% fee.
Unfortunately, most fiat (real-currency) on-ramps will require a 3%
(or more) fee to purchase tokens. This is unavoidable until the world
moves to a more blockchain-based economy.
How Do I get Other Cryptos?
You can buy them on exchanges, or through direct exchange on
places like www.shapeshift.com, or additionally buy through ICOs.
You should always have a personal wallet—even if you keep your
coins in a trusted place like Coinbase because you cannot send to
an ICO from a Coinbase wallet (well you can, but you won’t get your
tokens since you don’t own the private keys—so rather than
investing, you’ve basically just thrown those coins away).
 D Y M B ?
Y ,Y M B
Bitcoin Won’t Make You Rich Anymore
The sad news is that Bitcoin most likely won’t make you rich by
investing a few hundred or thousand dollars. Even if Bitcoin goes to
$100,000, that’s only a 10x increase. So investing $1k would only
net you $10,000.
Bitcoin has a really long way to go to make significant gains again: to
get to $100k or $500k or higher. This makes it high risk and low
reward for most investors.

Ethereum Has Already Surpassed $1000.00

You’ve kind of missed the boat on Ethereum. It’s already surpassed
the $1000 price tag, which means that a significant investment is
required to yield life-changing returns.
However we are far from the top of Ethereum’s price channel in my
humble opinion. My personal opinion is that ETH will hit at least $8k
per ETH by the end of 2018.

What’s Next Big Thing?

But it’s not all bad news for new crypto-investors. There are literally
dozens of ICOs being offered every month, and some of them have
climbed from fractions of a single penny up to $25 - $30 in late 2017
alone! There are many newly minted millionaires because of modest
investments made a year ago into these coins.
You can see the appendices of this book for a list of the top
performing coins of 2017 in terms of price growth, and my personal
predictions for top-performing coins to research for 2018.
 M Y D ’ M B
Most People still Don’t Know about Crypto
You’re probably reading this book because you found it on Amazon
after hearing about another crazy Bitcoin bull run. You and a whole
bunch of other people.
In fact having read this far you now know more about Bitcoin and
crypto currency than 99% of people. It is still the very early stages of
the crypto revolution.
Working dapps are only just beginning to be released in the first
quarter of 2018…there’s still time to get your seat on the rocket ship!

Crypto’s Only Killer Feature

In the tech world, there’s something we call a “killer feature”—it’s the
unique feature or functionality that makes people flock to your
product or service like crazy. It’s something that very few others are
doing and even fewer are doing well.
So many people are like you right now: They want to learn about this
exciting new sphere because they want to make money. And guess
what? That’s really the only concrete use we’ve seen for crypto so
far; and it’s the only thing it does better than other existing money
platforms (at the moment).
In the coming one to five years we are going to see crypto-based
tech replace a lot of the stuff we once used on a regular basis, but
that has not happened yet (it will soon—but not yet).
As amazing as this tech is, the only concrete thing it’s accomplished
right now is getting a lot of people rich. You can still be one of those
people!
So while there is still myriad uses on the horizon for Ethereum and
Bitcoin and blockchains and the dozens of other new companies just
starting out, it’s only now just starting to get noticed. If you get on
board now, you’ll probably still be able to win big!

There are Only a Handful of Working Dapps

Truth be told, I can’t really name any dapps that are “working”. The
most advanced dapps are still in beta, and have yet to be released to
the public.
The dapps closest to any definition of “done” are typically just
investing tools and don’t actually leverage the real power of the
blockchain.
The point I’m trying to make here is that you are still extremely early
to the party. Get in now while the getting’s good!
 T P C
S F
Phishing & Hacking
It would be irresponsible for me to not warn you about the ubiquitous
scams and pitfalls running rampant throughout this brave, new world.
If you ever get the chance to talk to a hacker or a computer security
expert, they’ll tell you that the greatest point of weakness in any
security system is the end user—because humans make mistakes
more often than computers do.
‘Phishing’ is a term which refers to someone trying to trick you into
giving your important data over to them so that they can steal your
funds. This is by far the greatest trap I have seen executed in the
crypto world.
Much of the software in the crypto-sphere is open source, so it’s very
easy to duplicate a site like www.myetherwallet.com.
Watch this, can you tell me the difference between these two urls?
www.myetherwallet.com
www.myetherwalIet.com
If that was a link in your address bar, would you notice that the
second ‘L’ is actually a capital ‘I’? Probably not. And it would take
you to a site that looked *exactly* like the correct website, a
complete duplicate.
The only difference is that when you enter your private keys to open
your wallet, it initiates a script that immediately drains your wallet of
all tokens and ETH. I’ve seen guys lose 200 ETH through such
scams. That’s almost $300,000 in current prices.
Another common phishing scheme is for someone to send you a
private message with a link on a forum or through email to a site like
Coinbase or an exchange you’re familiar with, or even to an ICO’s
website. They’ll buy the domain like coinbase.io then disguise the
URL display and you won’t even notice until long afrer you’ve
handed over your precious funds.

A message might
look like this:

Note how they stress the urgency and play on your greed to try and
get you to log in through their link. A legit company would never do
this—and they certainly wouldn’t send private messages.
Below are two screenshots of a popular exchange, Binance. Can
you notice which one is the real one?

And number two:

If you look at the addresses, you’ll see that one of them is clearly the
real Binance. But would you think to notice if someone simply
labeled their hyperlink with the correct address, but directed it to the
fake one? Probably not!

Fat Fingers
When you post a buy or sell order on an exchange, most exchanges
operate in such a way to automatically fill that order at the best
possible price. So for example, if you place an order to sell 1 ETH for
$500, but the highest buy order is for 1 ETH at $1000, the exchange
will sell your ETH for $1000.00—not $500. This way you can fill a
large order without having to individually place orders according to
everything currently present on the order book.
EtherDelta, however does NOT work this way. EtherDelta is a
decentralized exchange which has become very useful in recent
months, but it presents a large learning curve. For example: all
orders are placed and filled manually; so your order to sell 1 ETH at
$500 would sit as the lowest sell order until someone came along
and picked it off (which wouldn’t take very long).
This seems easy enough to avoid until you’re trading tokens for
other tokens, for example you can try to sell for .0001 ETH or .00001
ETH. That’s a lot easier to mix up!
I have seen people spend as much as 15 ETH to buy a tiny fraction
of a $2.00 token because they mixed up fields or messed up a
decimal place.
This is one of the most dangerous ways to lose all of your money in
crypto; so DON’T use EtherDelta until you’re absolutely certain you
know what you’re doing.

The below example

occurred about a week before writing this, when ETH was the price
of $1200.00:

This guy was trying to buy 900 units of a token that costs about
$4.00 each. He actually offered to buy .005 units at a price of 900
ETH / token. So he got .005 units of that token (about $0.05) and
spent 4.410 ETH on it (about $5,000). He filled in the wrong fields.
Don’t ever use Etherdelta.

Straight Up Scams
Some projects are simply straight up scams, run by scammers, who
have no interest in producing a real project.
“Contingency Blockchain Casino” was a project which ran an ICO in
the autumn of 2016, raising about 10,000 ETH. Yours truly sent them
10 ETH (about $100 at the time).
Sure enough, they sent me their CTY tokens (and they still sit in my
wallet), but they are traded nowhere and they are completely
worthless…and guess who up and ran off with the money? That’s
correct, the Contingency project completely disappeared.
The crypto world is swimming in thieves and brigands, all scouring to
get your money. Don’t be a fool and take good care of your hard-
earned money. Do your due diligence on new ICOs and don’t get
caught up in the hype.
 H F
Mt. Gox – Feb 2014 was declared insolvent and bankrupt mere
months after insisting that they were financially secure. They
declared that they were “hacked” and robbed of over 100,000
Bitcoins. Thousands of users lost all of their funds.
Neo & Bee – Spring/Summer 2014; the first ever brick & mortar
Bitcoin bank, the owner simply declared themselves “hacked” and
disappeared with all of the company funds even after the first branch
was officially opened. This was a highly reputable project, raising
hundreds of millions of dollars—all investors lost money. He
continued to taunt investors on Twitter with pictures of his new
Lamborghinis.
Bitfinex – Hacked in the summer of 2017, and robbed of many
thousands of Bitcoins. As a result they claimed 40% of all customer
funds and issued tradeable “IOU” reimbursement tokens which they
promised to eventually buy back at a 1:1 ratio with Bitcoin.
Eventually they did buy back all of the reimbursement tokens.
The Slockit DAO Hack – June 2016; $31 million dollars was drained
from the Slockit DAO ICO; a highly-anticipated ICO that was going to
change ETH history. A malicious bug allowed a hacker to drain the
funds. It was later learned that the DAO team was previously notified
of this bug but ignored it; resulting in the collapse of the ETH price
and ultimately a fork in the network (resulting in Ethereum Classic).
This too was a highly reputable project…that is until it wasn’t.
BTC-E – Their domain and many of their funds were seized by the
FBI as the owner was accused of money laundering. They have
since reopened under a new domain, and similar to Bitfinex, issued a
reimbursement token for 35% of client funds, which they eventually
promise to buy back on a 1:1 ratio.
Contingency – Autumn, 2016: a straight-up scam ICO which raised
over 10,000 ETH and never delivered any project, after a year of
nothing, the scammer just moved all funds to a coin tumbler and
probably bought himself an island.
Confido – An otherwise legitimate ICO promising logistical peer-2-
peer delivery tools for the blockchain. It went 20x upon initial
exchange release only to declare a few weeks later that “legal
troubles” prevented them from completing the project and saying
they would later refund all token holders at the ICO price. The
founder of the project has since disappeared, citing death threats,
and to my knowledge no one has yet received refunds.
CoinDash – July 2017 -- A much anticipated ICO. Moments after
releasing their ICO deposit address, the website was taken over and
a malicious address published in its place. The scammer’s address
received the vast majority of funds from the ICO. Months later, the
funds were mysteriously “returned” to the ICO contract.
Parity Hack 1 – June 2017 – White Hat hackers discover a flaw in
the highly trusted Parity Multi-signature wallet. They drain the wallets
of several trusted projects, including Swarm City—a total of over
$30,000,000 are “stolen”, but returned a week later.
Parity Hack 2 – Autumn 2017 – Parity Multi-Signature wallet isn’t
hacked, but through a flaw in the code allows a complete newb
programmer to wipe out the entire program’s stored library,
effectively (and permanently) freezing over $180,000,000—including
ALL of the funds of the much-anticipated Polkadot project.

The more I write, the more incidents I begin to remember. Hundreds

of millions of dollars: stolen from phishing, from hacks, from scam
ICO operators, from incompetent programmers, and even completely
non-malicious amateurs. No matter what kind of due diligence you
do, understand there are some things you can’t help and crypto is
rife with such problems, even if you do everything in your power to
protect yourself…so be careful.
 H S S Y C
Get a Hardware Wallet and Copy Your Private Keys
If you are going to hold more than $500 in tokens, you should get a
hardware wallet. Hardware wallets prevent anyone (including
yourself) from having access to your private keys. Through a
software mechanism, you can only confirm a transaction by pressing
a physical button.
So let’s say, for example, you plug your wallet into a phishing site—
you might see an immediate “confirm transaction” message appear
—well it won’t appear until you confirm it. So it can save you a lot of
crypto heart-ache!
For over four years the most trusted source for hardware wallets of
all kinds—who have thus far not had any reported incidents or
scandals—is the Ledger Wallet Company.
I use the Ledger Nano S, which supports numerous blockchain
token-types in a single device.

Bookmark Your Favorite Sites and Exchanges

A lot of the phishing sites will place ads on Google so if you type in
“my ether wallet” they come up first, but sure enough: they’re an evil
clone.
Type in all of your favorite sites (exchanges, coinbase, my ether
wallet, etc.) into your address bar by hand. Bookmark them, and
then use only the bookmarks in the future.

The Safety Checklist:

Use the following checklist to protect yourself as much as possible
from all the various kinds of disasters that can happen in Crypto:
 Copy and save your private keys, json files, back up
passwords, recovery phrases on several flash drives. Store
them separately from each other.
Get a (at least one) hardware wallet.
Divide funds among multiple wallet addresses.
Manually enter addresses and bookmark all of your
favourite crypto sites.
NEVER click links sent to you—ever.
NEVER give ANYONE your private keys—ever. Any site
or ICO that asks for these is a scam. 100%, no exceptions.
NEVER keep your funds on an exchange unless you are
actively trading. You never know when an exchange will be
shut down or freeze withdrawals and declare bankruptcy. If
you don’t own the private keys you don’t own the coins.
Do your due diligence before investing in a project.
ALWAYS double, triple, and quadruple check sending
addresses BEFORE sending—if you send to the wrong
address your funds are gone forever.
Verify the SSL certificate of a website before using it (see
the image below, the part highlighted in yellow—that is the
SSL cert.).

You can exercise these precautions in varying degrees, making 5

back-ups and dividing amongst a few different addresses. However
you like—but the Crypto Sphere is dangerous. Are you paranoid yet
—I’d like you to be. Paranoid folks are less likely to lose their funds.
 C :
Imagine you were able to invest in an company or entity called “The
Internet” in its earliest days…back when sending an email was about
the only thing it could do and was considered useless by most
people. What do you think such a share would go for? A few
fractions of a penny? Certainly less than a dollar!
Now imagine what an “Internet” share would be worth today, when
the entire modern world revolves around the Web versus then, when
it was a tremendous victory to send a single message to a computer
a few feet away.
A few hundred dollars then would have easily turned into millions,
quite possibly billions, over the next thirty years.
From an investing perspective, that is the opportunity before you with
crypto currencies. But now we’re not in the 1988 of Crypto anymore,
we’re more like in 1996. Websites are beginning to function, people
are learning how to use chat programs, and pretty soon some very
big players are going to build some fantastic programs using this
wonderful new technology.
But we’re not there quite yet.
You haven’t missed the boat entirely, but there will be booms and
busts and you need to know how to navigate the waters of crypto if
you wish to succeed. Unfortunately it’s not as easy as buying a
single token and holding anymore, it’s about buying the right tokens
and holding them.
After the dot-com bubble burst, Amazon stock lost 93% of its value
from its 1997 Initial Public Offering. A $10,000 investment in 1998
would have become worth a pitiful $700 in 2001. But if you didn’t sell
your Amazon stock and you held it until 2017, your $10,000
investment would be worth about $5,400,000.00.
Crypto has not yet found its Amazon.com, nor its Google, nor a
thousand other great programs that have changed the way we live—
but those things are definitely on the way.
But you need to understand the tech, because crypto grows in
bubbles and there WILL be crashes—the only way you will survive is
if you make wise investment decisions and hold confidence in your
investment.
Good Luck.

HEY! Keep Reading: there is some useful stuff on the following

pages!!
 U C L F M
Y :
Buy Your First Bitcoin (or fraction of a Bitcoin) & Get $10 Free:
https://www.coinbase.com
Get a Hardware Wallet:
https://www.ledgerwallet.com
Most Popular Exchanges:
www.binance.com – Worldwide
www.bittrex.com -- Europe
www.gdax.com -- US
www.KuCoin.com -- Worldwide
www.Cryptopia.co.nz -- Worldwide
www.Wex.nz – Worldwide; esp. Eastern Europe

Places to Learn about Crypto:

Official Sites:
https://bitcoin.org/en/getting-started
https://bitcoin.org/en/choose-your-wallet
https://ethereum.org/ether

Online Communities:
https://reddit.com/r/bitcoin
https://reddit.com/r/ethereum
https://www.reddit.com/r/BitcoinBeginners/
https://www.reddit.com/r/ethereumnoobies/

Bitcoin Obituaries:
 https://99bitcoins.com/bitcoinobituaries/

Lead Bitcoin Developer Declares Why He is Leaving Bitcoin

https://blog.plan99.net/the-resolution-of-the-bitcoin-
experiment-dabb30201f7

1995 Newsweek: Meticulously Erroneous Prediction of How the

Internet will Fail:
http://www.newsweek.com/clifford-stoll-why-web-wont-
be-nirvana-185306

Blockchain Explorers:
Sites where you can search address and transaction information on
the blockchain.
https://www.etherscan.com
https://www.blockexplorer.com

Historical Price & Market Cap Information:

Sites where you can track the historical performance of a coin based
on specified time periods.
https://www.tradingview.com/
https://cryptowat.ch/
https://coinmarketcap.com
https://www.icostats.com
G C C
T R :
[To Get] Goxxed Meaning to get scammed;
specifically in reference to the
dubious Mt. Gox exchange hack.
ATH All Time High; the highest price of
a particular token so far.
Bag-Holding Holding a token currently at a value
for less than you bought it for. I.E.
having an “unrealized” loss.
Block-Explorer A tool/website used for researching
a particular blockchain (i.e. looking
up transactions, block details,
addresses, etc.)
BTC/ETH/XRP/etc. Bitcoin/Ethereum/Ripple. Tokens
and coins are usually represented
in shorthand with three or four
letters.
Casper The much-anticipated update
according to the Ethereum
roadmap. This ushers Ethereum
into a Proof-of-Stake blockchain
model.
CMC Coin Market Cap; referring to
www.coinmarketcap.com; a
detailed website of all coin price
histories and current prices.
Confirmation(s) Refers to the number of blocks that
have been processed since the
transaction was sent (the first
confirmation being the first
successfully processed block).
Discord A private chatroom software.
Finney A unit of measurement of a fraction
of a single eth. .001 ETH
Flippening When the market cap of Ethereum
will exceed the market cap of
Bitcoin.
FOMO “Fear of Missing Out”; referring to
panic-buying a coin for fear that it
will go too high too quickly and
you’ll never get it at a cheaper
price.
FUD “Fear, Uncertainty, Doubt.” Usually
referring to false information or
 coordinated effort to devalue a
particular coin or token.
Gas (Gas Price) The (very very tiny) amount of ETH
spent to send a particular
transaction. The default is
0.000000021 ETH; it can be raised
or lowered depending on how
quickly you wish your transaction to
send, but the fastest transactions
can execute with 0.00000006 -
0.000001 ETH.
Github A repository where teams can post
their programming code for public
review and contribution.
Gwei A unit of measurement of a fraction
of an eth. 0.000000001; the default
maximum Gas price for sending
an ETH transaction is currently
0.000021 ETH, or 21,000 Gwei.
Hash A hash is a long combination of
characters (letters and numbers)
that represents a certain data set; it
can be encoded decoded by a
hashing software.
Hash Rate The speed at which a computer
completes an operation in the
Bitcoin code.
HODL Type-o of “hold”. Referring to
“never selling” until you hit your
price target.
Hype An extremely positive community
sentiment towards a particular coin
or token; also can be used to refer
to a coordinated effort to in-
organically inflate the price of a
token.
Lambo(s) Lamborghini(s) – Because if we
hodl long enough, we’ll all be able
to afford to cruise around in
Lambos.
Lambro(s) Brothers in Lamborghini – We’re all
hodling together, so we’re lambros.
Limit Order Placing an order to buy or sell on
an exchange to execute only at a
particular price.
Market Cap The total number of tokens
multiplied by the current price.
Market Order Placing an order to buy or sell on
an exchange at the current price
(to instantly fill).
MEW My Ether Wallet
(www.myetherwallet.com);
shorthand.
Mining Refers to the way that computers
 process blocks in a Proof-of-Work
blockchain (by solving an algorithm
to ‘mine’ the next block).
Moon (‘to moon’ / ‘mooned’) Referring to the price of a token “…
also: “Mewn” to go to the moon;” or go higher
than anyone expected.
Moonkid A crypto-currency enthusiast who
only wants to hear good news and
lives in denial about bad news
regarding a certain token.
Phishing A form of scam in which the
scammer sends you a link or email
and tries to evoke your private
information with the ultimate goal
of stealing your funds.
PoS Proof-of-Stake. A means of
processing blockchain transactions
using a script, instead of computer
power.
PoW Proof-of-Work. A means of
processing blockchain transactions
using computer power to solve an
algorithm.
Private Key The “ultimate password” for your
wallet. If you don’t own the private
keys, you don’t own the coins.
Public Address The address to which funds are
sent or received.
Satoshi A unit of measure for the smallest
amount of Bitcoin that can currently
be sent or transacted (0.00000001
BTC)
Scaling Refers to a network/blockchain’s
ability to support usage on a global
scale.
Shill (‘a shill’/ ‘to shill’) An insincere supporter of a
particular coin; trying to generate
inorganic hype or doubt with the
intent of artificially affecting the
price of a coin to benefit their own
trades.
Slack / Slack Channel A team-based chatroom program;
often used for ICO and project
communication with community
management.
Smart Contract Referring to an address on the
Ethereum Network that can house
a script that executes programming
actions based on certain
conditions.
Staking Lending a specified quantity of a
token to a special smart contract to
contribute to verifying blocks on a
Proof-of-Stake blockchain; stakers
 are paid interest for lending their
tokens to the contract.
Stop – Loss Order A means of protecting profits. A
special type of order that will
automatically execute a buy or sell
at a specified price in case the
token price begins to go in an
undesirable direction.
Telegram A community-management
chatroom tool. Similar to slack.
The Dao-saster / Dao-bacle Refers to the DAO hack which
occurred in June of 2016.
Tx ‘Transaction’ – shorthand.
USDT / Tether A token issued by Bitfinex which is
“tied’ to the US Dollar. It is only
ever worth $1.00; however
occasionally it trades at slightly
more or less than $1.00.
Wei A unit of measurement of a fraction
of a single Ethereum token.
(.000000000000000001 ETH)
YOLO You Only Live Once. Usually
referring to irrationally risky
investment in an ICO or a
leveraged trade.
 M T P 2018:
Please Note that these picks represent my personal opinions and I
could be wrong about it; so don’t take this as direct investment
advice—just me using my expertise to pick what I think is going to
yield good returns. Always do your own research, but this is just
intended as a starting point for where to start looking.
These are in no particular order
I anticipate significant gains over a 1 year period.
Prices are approximate; as they change from day-to-day
Some of these tokens are ERC-20; others have their own
blockchain—you should always DYOR (do your own
research)

Symbol Name Description Jan 2018 Total Official Site:

Price Supply
(tokens)
XRB Rai Instant $22.00 133M https://raiblocks.net/
Blocks blockchain
ETH Ethereum Smart $1300 96.9M https://www.ethereum.org/
Contracts
REQ Request Paypal 2.0 $0.75 999M https://request.network/#/
Network
ICN Iconomi Build-your- $3.79 99.7M https://www.iconomi.net/
own
Crypto
Hedge
Fund
Platform
XRP Ripple Micro- $1.85 99.9B https://ripple.com/
payments
blockchain
WTC Walton Blockchain $25.64 70M http://www.waltonchain.org/
Chain & Internet
of Things
RDN Raiden Eth $5.66 100M https://raiden.network/
Network Network
Scaling
Solution
IOTA IOTA Internet of $3.58 2.78B https://iota.org/
Things
 D ?
I want to thank you for purchasing and reading this book. I really
hope you got a lot out of it.

Can I ask a quick favor though?

If you enjoyed this book I would really appreciate it if you could leave
me a positive review on Amazon.
I love getting feedback from my customers and reviews on Amazon
really do make a difference. I read all my reviews and would really
appreciate your thoughts.
Thanks so much.
T.B. Holder
p.s. You can click here to go directly to the book on Amazon and
leave your review.
ALL RIGHTS RESERVED. No part of this publication may be
reproduced or transmitted in any form whatsoever, electronic, or
mechanical, including photocopying, recording, or by any
informational storage or retrieval system without express written,
dated and signed permission from the author.
[1]
, In theory this is to make Bitcoins more scarce, thus driving up the value
[2]
“Warehouse full” is a unit of measurement used to describe a whole crap-load of
servers.
[3]
Kind of like Communism
[4]
I won’t say how much. So don’t ask.
[5]
It’s worth noting that the terms “coin” and “token” are usually used
interchangeably—as mixing them up has no real impact on most peoples’
understanding of the functionality.
[6]
Some food for thought: that of the top 100 traded coins, more than 90% are built
on the Ethereum blockchain.
[7]
This isn’t always the team itself doing it; a lot of times it will be small groups of
wealthy investors to coordinate the pump together and then sell at their specified
target.
[8]
In 2018 we are just beginning to see the advent of proper crypto market
regulation.
[9]
Confido was an exciting project that immediately went 20x upon release to
exchanges, only to be discovered as a complete scam. The team photos were all
selfies and stolen from random Facebook profiles.
[10]
This name comes from “Magic: The Gathering Exchange”, the domain was
bought by Karpeles and turned into a Bitcoin Exchange.
[11]
It’s extremely important to note that there is currently no legal infrastructure
obliging any ICOs/blockchain companies to adhere to their promises. A company
may have a million tokens and promise that it represents an equal share in the
company, but when push comes to shove, there is actually nothing that obligates
them to enforce this. They very well could just close up shop and disappear—and
owe you nothing.
[12]
If you use the link in this book, you will get $10 for free when you make your
first purchase.