I believe you must have heard about Bitcoin, Dogecoin, Blockchain, NFTs etc… and how people claim to have made a lot of money out of it and you’re so curious to find out and learn how.
By the time you’re done reading this blog post, you go from a crypto newbie to crypto genius. 😊
Quick Intro: Hi, my name is Isaac Johnson owner of finbaze.com, Here I share latest side hustle update, affiliate marketing strategies, tool and tips to help boost your productivity and finance online – If this sounds like the kind of information you’ll be wanting, feel absolutely free to subscribe to our push notification so that you will be notified when I publish another useful contents like this one.
My real journey with cryptocurrency first started after I made $6,000+ (₦3,360,000+) worth of Bitcoin through an online Ponzi scheme Called Qubitlife and lost 75% of it during a bearish market early 2021.
Bull(ish) Market: Upward Movement (Bull Run) (Green)
Bear(ish) Market: Downward Movement (Bear Run) (Bleeding)
After my loss in early 2021, I had to take an online course which I paid $300 (₦168,000) just to learn everything about crypto. Not everyone, especially here in Nigeria, has or will like to spend such amount to get crypto knowledge. So in this article you’ll learn everything you need to know about cryptocurrency for free.
FYI: This article will be a bit lengthy, so below is a quick navigation to any topic you want to check out.
What Is Cryptocurrency?
cryptocurrency, crypto-currency, or crypto is a digital currency designed to serve as a medium of exchange through a computer network that is not reliant on any central authority, such as a government or bank, to uphold or maintain it.
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Why Should I Care About Crypto Currencies As Nigerian?
No one can stop you from using cryptocurrencies. Centralized Payment Services on the other hand can freeze your bank account or prevent a transaction from being made. Cryptocurrency is here to solve all these.
- A Cheap and Faster Payment Method:
When you make a transaction to someone on the other side if the world, your money can be with them within seconds at a fraction of the cost of an international transfer.
- Censorship Resistance:
Because of the way the cryptocurrency network is designed, it is virtually impossible for hackers or other attackers to shut it down or any Government System to ban it. I believe you will have heard the news when the Nigeria government banned cryptocurrency in February 2021. Yes, they did, but we were still able to buy and sell it using a method called p2p (peer2peer). With this, you can clearly see that nobody is in charge and can stop cryptocurrencies. 😂😂😂
What Is Peer-to-Peer (Crypto Currency)?
Peer-to-Peer or (P2P) is just like me transferring music from my android device to yours with the help of Bluetooth. No data required. (just trying to break it down).
Investopedia Defines It As:
The exchange or sharing of information, data, or assets between parties without the involvement of a central authority. Peer-to-peer (P2P) involves decentralized interactions among individuals and groups. This approach has been used in computers and networking (peer-to-peer file sharing), as well as with trading virtual currencies.
Cryptocurrencies are classified based on what they are used for, and Coingecko on its platform has classified them, so it’s easy to know what group a particular token or coin belongs to → https://coingecko.com/en/categories
Cryptocurrencies make use of of technology called Blockchain.
What Is Blockchain Technology?
Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system (You can’t alter any information without everyone noticing). A blockchain is essentially a digital database/ledger stat stores transactions that are duplicated and distributed across the entire network of computer systems on the blockchain.
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What Are Tokens and Coins?
In simple terms, the difference between tokens and coins is that coins are unique to their blockchain while tokens depend on other blockchain or they don’t have their own blockchain. Coins are used to pay for transaction fees on the blockchain and are also used as payment or digital cash.
Examples of Coins Are: $Bitcoin, $Ethereum, $Litecoin, $Xrp, $Solana, $Polkadot, $Tron
→ click here to see a full list of coins
Examples of Tokens Are: $Uniswap, $Chainlink, $Cake, $Enjin
→ click here to see a full list of tokens
Types Of Exchanges?
We Have Centralized and Decentralized Exchanges:
Exchanges are platform that allows the trading of Cryptocurrencies, i.e. where you buy and sell coins.
Centralized Exchanges (or CEX) are exchanges that are owned by centralized or private authorities and you need to create an account and also perform a KYC (know your customer) verification to be able to use them.
Examples of Centralized Exchanges (CEX) Are:
- BINANCE EXCHANGE: → https://finbaze.com/binance
- COINBASE WALLET: → https://finbaze.com/coinbase
- KUCOIN EXCHANGE: → https://finbaze.com/kucoin
Get $10 – $50 worth crypto asset as a welcome bonus when you signup using our link above to create your account.
Decentralized Exchanges, on the other hands are now owned by anyone, but the difference is that you don’t need to register an account or require KYC (know your customer) to be able to use decentralized Exchanges.
Definition. A decentralized exchange (or DEX) is a peer-to-peer marketplace where transactions occur directly between crypto traders.
All you need is just a wallet like Trust Wallet that has a Dapps or Decentralize Apps Browser to connect with the decentralized Exchange.
DEX (decentralized exchange) has an advantage over CEX (centralized exchange) and also has some risk as well.
The advantages of DEX is that it’s easy to use and doesn’t need KYC (know your customer) or registration of any kind and it’s cheaper as well with fewer fees. The disadvantage or risk involved is that since it’s decentralized, it’s an opportunity for scammers to deploy scam tokens and scam people, by either selling worthless tokens, rug-pulling and various other risk involved.
DOWNLOAD TRUST WALLET: ANDRIOD | IPHONE
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What Are The Examples of DEX Exchanges?
Examples of Decentralize Exchanges (DEX) Are:
PancakeSwap is a decentralized exchange for swapping BEP20 tokens on Binance Smart Chain. PancakeSwap uses an automated market maker (AMM) model where users trade against a liquidity pool. Such pools are filled with users’ funds. They deposit them into the pool, receiving liquidity provider (or LP) tokens in return. They can use those tokens to reclaim their share, plus a portion of the trading fees.
Uniswap is a protocol for automated token exchange on Ethereum. It was launched on November 2, 2018. Uniswap describes itself as a simple smart contract interface for swapping ERC20 tokens. It has a formalized model for pooling liquidity reserves. It serves as an open-source frontend interface for traders and liquidity providers and is committed to providing free and decentralized asset exchange.
SushiSwap is first on the list of culinary-themed decentralized exchanges. If you’re a fan of sushi over unicorns, this may appeal to your senses more. In any case, SushiSwap has a lot in common with Uniswap since it is a fork of Uniswap.
and lots more…
(See all decentralized exchanges and their ranking here: → https://finbaze.com/dexlist)
Best and Credible CEX Exchanges to use
- Binance → https://finbaze.com/binance
- Coinbase → https://finbaze.com/coinbase
- Kucoin → https://finbaze.com/kucoin
- Huobi, Okex, FTX Pro
Understanding Decentralize Exchanges there’s also what we call Decentralized Coins or (DeFi Coins)
What Is Decentralized Finance (DeFi)?
Decentralized Finance or De-Fi is the movement that allows users to use financial services such as borrowing, lending and trading without the need to rely on centralized entities. These financial services are provided via Decentralized Applications (Dapp), and make use of smart contracts.
Some of the key attractions of DeFi for many users are:
- It eliminates the fees that banks and other financial companies charge for using their services.
- You hold your money in a secure digital wallet instead of keeping it in a bank.
- Anyone with an internet connection can use it without needing approval.
- You can transfer funds in seconds and minutes.
Key Takeaways About De-Fi
- Decentralized finance, or DeFi, uses emerging technology to remove third parties in financial transactions.
- The components of DeFi are stable coins, software, and hardware that enable the development of applications.
- The infrastructure for DeFi and its regulation are still under development and debate.
Getting into De-Fi
Most De-Fi DAPPS are currently built on the Ethereum blockchain.
Now because if the high transaction or gas fee on Ethereum network, Binance came with their own blockchain called the Binance Smart Chain. (BSC) is faster than Eth and has little or minimal fees and that’s what we will be using.
BSC uses BNB BEP20 token for transaction fees and to swap coins so go and purchase Smart Chain BNB
First to fully understand De-Fi you also need to understand how a Smart Contracts works and how the integration of both De-Fi and Smart Contract comes into place.
What Is Smart Contract?
Smart contract is a programmable contract that allows two counterparties to set conditions of a transaction without needing to trust another third party for the execution of the contract.
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Other Source Defines: Smart contracts as a simply program stored on a blockchain that runs when predetermined conditions are met. They typically are used to automating the execution of an agreement so that all participants can be immediately certain of the outcome, with no intermediary’s involvement or time loss.
For example, if I (Isaac Johnson) wants to set up an auto recharge or auto transfer of N10,000 to you at the End of each month for the next 12 months, Me not getting to do the transfer myself and allowing/using my banking app to activate that feature is how a smart contract works.
- It knows the current date and time.
- At the end of each month, send you N10,000 automatically.
- It repeats the process until the end date in the smart contract is due.
Using a smart contract, I have bypassed the need of opening the banking app each end of the month to send the fund to you and made the process automated by a banking robot.
ALSO READ: → 10 Crypto Asset Every Nigerian Should Have In Their Crypto Wallet
Telegram Group: → Here I Talk About Crypto and Other Ways To Make Money Online
How Do I Make Money With Cryptocurrency In Nigeria?
I believe the reason you’re reading and learning all of this is because you’re interested in getting into crypto and want to turn cryptos like Bitcoin into cash.
To make a wise market decision you also need to know how to analyse the crypto market.
- When to enter the market
- When to sell-off and jump out of the market
- How to identify a good coin/token
How Do I Analyse The Crypto Market In Nigeria?
- CoinMarketCap is the world’s most-referenced price-tracking website/tool for cryptoassets in the rapidly growing cryptocurrency space. Its mission is to make crypto discoverable and efficient globally by empowering retail users with unbiased, high quality, and accurate information for drawing their own informed conclusions.
REGISTER HERE:→ https://finbaze.com/cmc
DOWNLOAD THE APP: ANDRIOD | IPHONE
- Coingecko is also one of the world’s largest independent cryptocurrency data aggregator with over 13,000+ different crypto assets tracked across over 700+ exchanges, a platform which provides a fundamental analysis of the crypto market. Besides tracking price, volume and market capitalisation, etc..
DOWNLOAD THE APP: ANDRIOD | IPHONE
Three strategies for making money with crypto
- First, you can invest or trade in the crypto exchange market. You can do this owning no crypto yourself, like investing in gold on the stock market.
- Second, you can use the coin you already own to stake and lend coins to the system or other users.
- Third, you can take part in the blockchain system by mining or receiving coin rewards for work done in the system.
- Staking and lending.
- Airdrops and Forks.
I explored each of these strategies in more detail below:
Investing is the long-term strategy of buying and holding crypto assets for some time. Crypto assets are generally well suited to a buy-and-hold strategy. They are extremely volatile in the short term but have tremendous long-term potential for growth.
The investing strategy requires you to identify more stable assets that will be around for the long term. Assets such as Bitcoin and Ethereum have been known to show a long-term price increase and can be considered a safe investment in this regard.
While investing is a long-term endeavour based on the buy-and-hold strategy, trading is meant to exploit short-term opportunities.
The crypto market is volatile. This means the prices of assets can increase and decrease in price dramatically over the short term.
To be a successful trader, you need to have the proper analytical and technical skills. You’ll need to analyse market charts on the performance of the listed assets so that you can make accurate predictions about price increases and decreases.
When trading, you can either take a long or short position, depending on whether you expect the price of an asset to rise or fall. This means you can make a profit regardless of whether the crypto market is bullish or bearish.
→ Learn More On Crypto Trading,
→ Should I Invest or Trade?
3. Staking and Lending
Staking is a way of validating crypto transactions. If you are staking, you own coins but you don’t spend them. Instead, you lock the coins in a cryptocurrency wallet.
A Proof of Stake network then uses your coins to validate transactions. You receive rewards for doing so. You are lending coins to the network. This allows the network to maintain its security and verify transactions. The reward you receive is like the interest a bank would pay you for a credit balance.
The Proof of Stake algorithm chooses transaction validatory based on the number of coins you have committed to stake. This makes its much more energy-efficient than crypto mining and does not require you to own expensive hardware.
Cryptocurrency Mining is still a crucial component of the Proof of Work mechanism. It is where the value of a cryptocurrency is generated.
If you mine a cryptocurrency, you are rewarded with new coins. To mine, you need technical expertise and upfront investment in specialized hardware.
Running a master node as a subset of mining. It requires expertise and significant upfront and ongoing investment.
Airdrops and free tokens are distributed to generate awareness. An exchange might do an AirDrop to create a large user base for a project. Being part of an AirDrop can get you a free coin that you can then use to buy things or to invest or trade.
A blockchain forks because of changes or upgrades in a protocol that creates new coins. If you hold coins on the original chain, you will typically get free tokens on the new network. This means you get a free coin because you were in the right place at the right time.
→ Click Here To Join My Telegram Channel
(There I Share Quality AirDrop Updates to My Students to Claim)
Other Crypto Considerations
Knowing and understanding the strategies above will be really helpful — Everyone gets into the cryptocurrency field to make money, but sometimes not all end up doing that. A lot of people either simply give up along the way, or lose money because they do not properly understand how to make money with cryptocurrency.
Premium Crypto Class Here: → https://finbaze.com/crypto
Some Important Cryptocurrency Slang Words
- ATH (All-Time High)
This term is not only used in the cryptocurrency world, but its use became quite popular there because of several coins creating new price points that had never been traded before. Bitcoin, Ether, ADA, Doge, BNB have all created ATHs this year.
“HODL” means holding a coin even if it crashes, and awaiting further growth. This term was trending in the recent cryptocurrency crash that happened on the 19th of May, 2021.The slang came to be on a Bitcoin talk forum in 2013, where a user made a typo in the word HOLD (hold), writing the word HODL in his panic.
“Cryptoland” is a term that refers to the cryptocurrency ecosystem, including all blockchain technologies.
- FUD (Fear, Uncertainty, and Doubt)
This term is used in the cryptocurrency world to describe a psychological trick used to spread doubt and fear, which could cause a certain coin, or the entire cryptocurrency space, to drop in price.
- DYOR (Do Your Own Research)
The cryptocurrency world is full of a lot of unknowns and uncertainties. This slang prompts investors in the space to do their research before making any investment decision relating to cryptocurrencies. It is possibly the most important dogma in the cryptocurrency world.
- To the Moon
“To the moon” means that the price has risen drastically, reaching the peak value. It’s usually used when a certain cryptocurrency has done over 100% increase within a short period.
“Whale” is used to describe an investor who owns five percent or more of a particular cryptocurrency’s coin in circulation. For instance, a whale in Bitcoin will be someone who owns 5% or more of Bitcoin’s 18,713,700 circulating supply. This whale would be someone who owns at least 935,685 units of bitcoin.
- Pump and dump
Pump and dump is a tactic used by groups to manipulate the sentiments of the crypto market.
“Rekt” means to sell the crypto too soon or late. In other words, to suffer losses without coping with emotions.
Refers to transaction fees on the Ethereum network.
A Shitcoin is a cryptocurrency that has no utility or unique feature. It is considered a bad investment based on one’s subjective opinion. The term is also used to describe coins that do not serve any particular purpose other than being a means of exchange.
This is short for “Satoshi,” the pseudonym used by the bitcoin creator. It refers to the smallest unit of bitcoin stored on the blockchain. Satoshi refers to one hundred millionth bitcoin (0.00000001 BTC).
Shill is used when a person promotes a specific digital coin or blockchain project. Shilling in the world of cryptocurrencies is part of a marketing ploy to bring awareness to certain coins that may or may not hold any value. This is why investors are advised to DYOR.
Mainnet is a blockchain that conducts real operations with cryptocurrency, forwarding them from senders to recipients.
AirDrop is a free distribution of tokens. Tokens can be used to popularize a completely new coin, which is not yet on the exchanges. So far, only preliminary sales of tokens are carried out.