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Cryptocurrencies today are considered currency in the modern world. This has changed the formats of monetary change and provided the model of monetary transactions and investments. With more people adopting bitcoins, ethers, and other cryptocurrencies. People are interested in knowing more about the complex world of cryptocurrencies.

Education about digital money is not exclusive to the process of investing but extends to the appreciation of the technology used. The compromises made when investing, and the policies that are announced. Moreover, it provides hope to get to the point of getting your feet wet in the words and language of cryptocurrencies. Hence to become prepared and be comfortable to the knowhow the risks and unstable nature of digital money.

To new investors, Cryptocurrencies are difficult to comprehend. This is because they are rooted in computer engineering as well as the Global Market being unstable. Nevertheless, the possession of proper tools and a systematic approach. This helps one to understand cryptocurrency basics and the ways to utilize and make rational decisions within the niche.

Understanding the Basics

To teach yourself cryptocurrency you need to understand its basics and moreover its depths.

Cryptography

Cryptocurrencies are based on the principles of cryptocurrencies. Cryptographic functions control monetary transactions, the issuance of new units, and the establishment of assets. That is why, in the field of cryptocurrency, cryptography effectively ensures that it is almost impossible to forge or counterfeit the currency, hence avoiding double spending.

Digital Nature

Cryptocurrencies do not have a physical counterpart. They are generated and stored virtually. Contrary to real money such as dollars, euros, or other national currencies, there are no actual banknotes or coins.

Decentralization 

Almost all cryptocurrencies are based on the technology known as blockchain. Blockchain is a computerized system distributed across numerous computers. This makes cryptocurrencies theoretically completely free from the old features of government regulation and impact.

Crypto Mining

Mining is the method by which the transaction’s existence is confirmed and incorporated within the public record or the blockchain. Moreover, it is also the way by which new coins of the cryptocurrency are produced. It also involves special information such as the solving of a difficult number problem by miners via a computer. Upon solving the issue, a transaction or several transactions are incorporated into the online ledger. 

Anonymity and Transparency

This allows members to be anonymous to the other traders by default. Moreover, transactions are bound to an address which are text string and characters that are not associated with the identity of the owner, although the transaction records of the tokenized assets are kept on the blockchain, which is easily accessible by anyone.

Crypto Wallets

Cryptocurrency wallets are digital tools, that enable the users to store and conduct administrative functions on their cryptocurrency addresses. Wallets can be of two types, hardware wallet and software wallet. Wallets hold one’s public and private keys and provide connectivity to numerous blockchains to allow for the execution of send/receive and also check on one’s balance.

Crypto Volatility

Cryptocurrencies’ intrinsic value is not easy to quantify. Some of them fluctuate frequently, hence they could be characterized by high volatility such as the changes occasioned by market forces, investors’ attitudes, policy changes, and technology.

Regulation and Legal Aspects

Cryptocurrencies are still relatively new and there are questions on whether or not regulation is beneficial. Moreover, there are variations in the forms of regulations some countries have completely banned cryptocurrencies. While others have integrated them into the financial systems of their countries.

Knowledge of these fundamentals helps an analyst to understand the specifics of cryptocurrencies. Moreover knowing how they are redefining various spheres of people’s financial and technological lives. Regardless of whether for business purposes, creating new technological projects, or general curiosity, understanding what a cryptocurrency truly is in principle becomes a necessity in the modern world.

History and Evolution of Crypto Currencies

Bitcoin along with the emergence of other cryptocurrencies such as Ethereum is one of the interesting phenomena in the digital age that has revolutionized finance and technology. This has brought about changes in social behaviors in society worldwide. Here’s an overview of the dynamic landscape of cryptocurrencies:

The White Paper and the First Block: Bitcoin’s journey began with the publication of a whitepaper titled ‘Bitcoin’ in 2008. This project was a Peer-to-Peer Electronic Cash System. It was published online by a person, or a group of people using the pseudonym Satoshi Nakamoto. However, his paper presented a new digital currency that was not controlled by a central server as most contemporary payment systems do. 

Nakamoto mined the first ever bitcoin which is referred to as the ‘genesis block’ on the year 2009. This block contained a secret that stated there was a problem in the financial world hence encouraging the usage of bitcoins. 

Also read: Does Cryptocurrencies Hurt African Firms?

How Cryptocurrencies are Growing and Being Adopted

2010-2012: this is when the earliest usage and the first exchange was recognized in the world of cryptocurrency. 

2010: A famous early trade was of pizzas. 10,000 Bitcoins were exchanged for two pizzas, which gave the first application of Bitcoins. Moreover, it was also in the same year that the first of the cryptocurrency exchanges was established. Through the exchanges, individuals could swap Bitcoin for traditional currencies. 

2011-2012: Bitcoin started being noticed by the public. Other cryptocurrencies came into the market based on its blockchain innovation concept, hence commonly known as ‘altcoins’.

2013: Ethereum which was created by Vitalik Buterin. This was different from Bitcoin as Ethereum provided for what are called “smart contracts. Their terms are coded directly into the program. Hence making the use of the blockchain from just transfers of values and money to other applications. 

2015: Ethereum launched with the intent of enabling the development of decentralized applications abbreviated as dApps. 

Milestones and Challenges 

2017: Cryptocurrencies got their major boost this year with an increase in trading volumes across the globe. Additionally, actual money associated with Bitcoin rapidly increased to an all-time high accompanied by huge proliferation of new altcoins and ICOs. 

2020-2021: Cryptocurrencies rose and surpassed earlier levels. This was greatly impacted due to institutional money and the growth of DeFi. This increased flexibility and scalability in maintaining the community’s interest. 

2021: The cryptocurrency space was introduced to Non-Fungible Tokens enabling the application of blockchain from finance to arts, music, and other forms of property rights. 

Current crypto Landscape

Cryptocurrencies continue to possess significant market shares among the crypto-assets. Hence being viewed as substituting gold for a hedge against risks in today’s economies. Ethereum is still in active development, and every year has major upgrades designed to improve its tech or minimize its effects on the environment. At the same time, the market is occupied by thousands of other cryptocurrencies that have found their focus areas and successfully operate. Moreover addressing various needs ranging from privacy and supply chain to gaming and social networks. 

The landmarks registered in the sphere of cryptocurrencies are not only the achievements in technical progress but also the change in the financial mode. Ideas behind blockchain target to replace the centralized monetary system. With these teething factors as well as changes in policy formulations as regulatory bodies continue to rub shoulders with the maturing technology, the adoption of mainstreams and other dimensions of future inclusion remain bright. 

PROCEDURE TO ADHERE TO TO TEACH YOURSELF CRYPTO

Introduction to Crypto Wallets

A crypto wallet is one of the most fundamental instruments for any individual using cryptocurrencies. it is the tool that facilitates interaction with the blockchain platforms. This houses your public and private keys, enabling you to transact your cryptocurrencies safely. The kind of crypto wallets and knowledge of how they ought to be managed appropriately is very vital when it comes to the management of digital assets.

Types of Crypto Wallets

Hot wallets

They are commonly accessed online. This means that they are ideal for regular and instant use. They are available either as website interfaces, mobile apps, or standalone software for a PC. However, internet connectivity exposes them to risks such as hacking and phishing among others especially in B2C businesses.

Examples of Hot Wallets

Coinbase Wallet: It is a decentralized digital wallet for Bitcoin, Ethereum, and Litecoin.

MetaMask: Communicates with Ethereum and tokens in the ERC-20 standard, moreover synchronizing perfectly with decentralized applications (dApps).

Cold wallets

These are wallets that are located offline, thus offering more security due to their less influence from the internet. They are perfect for storing significant amounts of cryptocurrency in the long term. 

Examples of Cold Wallets 

Hardware Wallets: These are wallets such as Ledger Nano S or Trezor that keep your keys separate from the internet. 

Paper Wallets: Paper sheets contain public and private keys which are embossed onto the paper. 

Also read: Does Kenya Have Cryptocurrency?

Choosing a Cryptocurrency Exchange

To participate in crypto trading and investing one needs to use a crypto exchange as an intermediary. However, when selecting the platform for trading or investing in the cryptocurrency of your choice, you should pay attention to several aspects so as not to experience crucial inconveniences or loss of your funds.

factors to consider when choosing a crypto exchange

Security 

security is the most important aspect when dealing with digital assets. When evaluating an exchange’s security, it is important to consider factors like:

Authentication mechanisms: The exchange should have 2 2-factor authentication hence more preferably with tokens or smartphones. 

Storage solutions: Consider using exchanges that control most of their customer’s funds in cold storage, these are normally out of the internet and much harder to hack. 

Insurance policies: Consider using exchanges that offer insurance on digital assets, so there is always insurance in cases of robbery. 

How to Place Trades in Cryptocurrencies

How to place trades or make investments in cryptocurrencies plays a great role in teaching yourself cryptocurrencies. To begin with, you have to register on a Cryptocurrency Exchange. After creating a trading account, proceed to deposit funds, then you can start trading. Here are the basic steps to follow:

Choose a Pair: Choose the specific currency pair on which you would like to invest in. For instance, BTC/USD, which is Bitcoin against the US Dollar. 

Trading Platform: Look at the market information on the trading platform offered by the exchange to help you get a deeper understanding of the overall trading activities. 

Enter Order Details: Enter the number of shares you would like to purchase or sell and the type of order you desire in more detail.

Reading Crypto Charts

Reading crypto charts may be challenging for a bigger crypto enthusiast, but it can be simpler to understand with the understanding of outlines such as:

Candlestick Charts: These are the most sought-after charts in trading, especially in the crypto market. Every candle gives data on the opening value, closing value, highest value, and lowest value of the given time frame.  

Volume Bars: Located at the base of the chart, they represent the total amount of coins exchanged over a certain period and relate to activity and movement that’s taking place in the market.

Technical Indicators: Indicators such as trends, moving average, RSI (Relative Strength Index), and MACD (Moving Average Convergence Divergence) can be useful in determining directions and reversal points. 

Understanding Different Order Types

It is crucial to understand order types as they play a great role in your investment depending on the order type you execute. Order types include:

Market Orders: They execute a deal to purchase or sell cryptocurrencies at the present price in the market.

Limit Orders: They specify the highest or the lowest price you are likely to pay or accept for a particular security. However, this type of order only triggers the buying or selling of the security after reaching the given price by the trader.

Stop-Limit Orders: This is an order to buy a cryptocurrency coupled with a stop-and-limit order. You set a stop price, which once the crypto price hits will convert to a limit. this is to regulate anticipated loss in a declining market or employed to protect profits when the price gets to a given level.

Also read: Is There an African Cryptocurrency?

Avoiding Phishing Scams and Ensuring Secure Transactions

Due to the decentralized nature of cryptocurrencies, it is hence prone to insecurities such as scames and hucks. However, phishing scams are widely present in the cryptocurrency space. Some ways to be in the know of phishing scams and ensure secure transactions are:

Be Skeptical of Emails and Messages: Phishing scams usually involve emails or messages on social media accounts in different forms of official-looking links. Don’t take anything at face value always ensure you check email identities and ensure that the communication is official. 

Avoid Clicking Unverified Links: Avoid links received through spam messages or emails. Rather, open access services through its specific firm website or any other bookmark that you previously made. 

Use Secure Networks: Always use a private and secure network if you are using your cryptocurrency, or planning to make a transaction. Avoid public Wi-Fi from coffee shops and similar places without a VPN connection. 

Regular Update and Backup: This makes sure the crypto wallet operations and browser are up to date. This plays an important role in the possibility of restoring your files and an important part in case of an attack. 

Enable Security Features: Enable security features such as IP restriction, withdrawal address restriction, and options that limit fund movements. Engaging these can help to gain more protection. Moreover, having linked 2FA with the proper measures to prevent attacks from phishing, and losing your crypto.

Advanced Learning of Cryptocurrencies

Technical analysis and investing strategies are pieces of knowledge that can come in handy for all traders and investors no matter whether they trade or invest in stocks, forex, or cryptocurrencies. They assist traders in achieving good results by being able to form trades based on the use of past market data and patterns.

Moreover, Technical analysis is the analysis of the market’s actions especially by way of charting in an endeavor to predict forthcoming price trends. Technical analysis involves key steps such as.

Reading Charts: understand how to read a specific type of chart and predict its possible future price.

Understanding Indicators: understand how to use indicators such as trend indicators,  momentum indicators, and volume indicators. This helps bring out the clean displacement of the price and establish the direction of any market. Moreover identifying trends in prices and the distribution rate that will mark the over-bought and over-sold points, and assessing the reliability of a price trend and any reversal by the activity of volumes.

Common Trading Strategies

Day Trading: This is trading crypto instruments through the acquisition and disposal of cryptocurrencies within the same business day. A day trader focuses on small price fluctuations and utilizes borrowed funds to increase profits.

 Swing Trading: It is generally trading using a position that lasts from a few days up to a few weeks. This plan seeks to make profits from a probable price shift and the strategy is less demanding than day trading. Moreover, it involves the identification of the trend and how much the market is likely to reciprocate, besides placing a stop-loss order to prevent a possible loss.

Position Trading: This strategy entails purchasing and holding an asset for a long duration irrespective of fluctuating market prices. Moreover, based on the principle that the long-term trends will be positive.

However, each of these strategies comes with its own set of risks and rewards. Effective traders often combine insights from technical analysis with sound money management. Moreover, with a thorough understanding of their risk tolerance to optimize their trading outcomes. However, whether you’re day trading, swing trading, or position trading. Mastering technical analysis can provide a significant edge in developing effective trading strategies.

Also read: Which African Countries Ban Crypto?

DeFi

As a beginner in the field of cryptocurrency, you need to have an understanding of decentralized finance. Its technologies are rapidly changing the financial industry through the provision of decentralized services. The major idea of DeFi is to disintermediate all the middlemen and enable direct financial transactions via smart contracts executed on the Ethereum blockchain and other relevant blockchains. This new financial environment improves the effectiveness and security of the ownership and accessibility of the world population to financial services while not requiring the infrastructure of banking systems. Decentralized finance contains benefits such as:

Accessibility: DeFi applications are available through an internet connection, and there will be no barriers to access by financial goliaths. 

Transparency: Every activity takes place in DeFi by executing a transaction. All the transactions get stored in the blockchain, for public view in all operations. 

Censorship-resistant: The decentralized transactions in the DeFi sector cannot be manipulated or controlled by a single entity. Hence this makes the value to be fair. 

Innovation: DeFi has given rise to virtually countless new things in the financial sector. Moreover, people are encouraged to keep on coming up with new products and services.

Yield Farming and Staking

Yield farming also known as liquidity mining is the process of earning rewards with cryptocurrency assets. This implies freezing of cryptocurrencies and earning of rewards. Often, it cooperates with users so-called Liquidity Providers (LP), which provide their funds to Liquidity Pool. The pool helps in DeFi trading, lending, and borrowing. Yield farming works in a majority of ways such as:

Liquidity Pools: Users place their crypto tokens in a pool in return for receiving shares. This pool fuels a market for lending, borrowing, and swapping of tokens. This is the primary operation of the trading platform. Hence trading on platform costs, the costs are distributed to the liquidity-providing parties in a ratio to the size of the pool. 

Rewards: This is an incentive apart from the fees that go to the liquidity providers, usually in the form of token rewards. This in turn can enable one to achieve Very High Annual Percentage Yields (VHAPY) on the other hand executes certain risks that include impermanent loss. 

Staking means putting some amount of cryptocurrency in a temporarily inactive state to get a bigger portion of the identical type of digital currency as a reward. Staking in many blockchains can be a way of sustaining the performance of a PoS system. This means keeping coins in a digital wallet for the protection and functioning of a blockchain settlement. In simple terms, staking is the process of attaching coins to the network to get a reward hence providing passive income.

Continuous Learning and Development 

As a highly innovative and fast-growing industry, there is always new information for the new investor to learn. Hence this makes the crypto market very fragile and always in a state of change due to technological, regulatory, and psychological factors. To stay ahead is important to:

Keeping up to date with the Crypto Market:  Follow market trends and updates regularly. This helps regulate the profits and losses of invested cryptocurrencies. Moreover, it can act as a confluence to a future investment.

Technological Advancements: Technologies based on blockchain are constantly developing, new protocols, coins, and tokens appear all the time. Knowledge of these technologies and their possible effect on the market environment is important in making investment decisions and seeking potential investments. 

Regulatory Changes: That is why the overall legal framework surrounding cryptocurrencies is still emerging. This makes it critical to impune that changes in regulations can have profound impacts on the market, ranging from the price of an asset to the legal suitability of an asset. 

Market Sentiment: The crypto market is highly volatile mainly because of changes in stock and the flow of investments by investors based on news, trends from social media platforms, and any economic factors. Information on these can help in perhaps identifying movements in a particular market.

Market Performance Monitoring Utilities: For efficiency in the management of change in the crypto market. An investor can monitor a particular crypto market performance by using tools like:

CoinMarketCap: On this website, the user can get information about the current state of different cryptocurrencies. It offers information on price, volume, market cap, supply, and historical information in cryptocurrencies.

CryptoCompare: This platform enables the comparison of many characteristics relating to the various forms of cryptocurrencies. Moreover, elaborate information that could include the efficiency of mining among others, different exchanges, and wallets are also available.

Strategies for Continuous Learning in Crypto

Regular Education: Attend educational lessons, courses, webinars, and books related to cryptocurrency and blockchain technology. This helps to learn from people who already are knowledgeable in the crypto space.

Community Engagement: Discuss on Reddit, discord, and specific forums where people are interested in such products or services. Such communities are usually up to date with the latest market trends and technologies and their discussions are usually real time. 

Experimentation: Trade on simulated platforms so that you do not lose money or risk a small amount of your investment capital, then invest in new coins that you can experiment with.

SAFETY TIPS

Start Small: Start with a small amount for it helps to familiarize oneself with market trends and operation environment without much losses. 

Educate Yourself: Learn more about the dynamic markets and the analytics methods as well as the technology behind cryptocurrencies on an ongoing basis. 

Use Risk Management Tools: Minimize the losses by using tools such as stop-loss orders and other related orders. 

Stay Updated: Pay attention to news and trends in the crypto market since it is volatile concerning technological and legislative shifts.

Join Communities: To get some advice, new ideas, or market moves you should join the communities of people involved in cryptocurrencies.

Balance the Portfolio: This is safer than adopting a certain asset. It reduces the probability of losing an investment. At the same time, it gives a chance to increase the probability of getting more from other distinct investments.

Keep Security Top of Mind: In all the operations use and store the cryptocurrencies. Ensure security as much as possible to prevent issues of theft and fake investment promises.

Embrace Technology: Develop undefined interest in learning and tracking markets and tracking your investments.

Also read: What You Need to Know About DeFi: How Does it Work?

FaQs about: How do I Teach Myself Crypto?