What is Crypto-Currency?

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What is Cryptocurrency?

Cryptocurrency is a digital asset which can be sent online between person to person (P2P) and is completely decentralized. The most well-known, and the first crypto-currency, is called "Bitcoin". Other crypto-currencies exist as well, the most popular ones being Litecoin, Ethereum and DASH, however there are many more. Smaller cryptocurrencies tend to be more volatile and higher risk. For simplicity's sake, this guide focuses on Bitcoin, but all other cryptocurrencies are extremely similar.

The values of cryptos and their market caps can be found and compared:

Cryptocurrency Market Capitalizations | CoinMarketCap

Video: What is Bitcoin?

Bitcoin FAQ:

http://bitcoin.org/en/faq

Bitcoin and other cryptocurrencies have potential to revolutionize e-commerce, or fizzle into nothing. Right now, they are mostly used as highly volatile, speculative investments. Most people buy bitcoins because they expect the price to increase. Here are some good areas to track Bitcoin price and volumes across exchanges:

www.bitcoincharts.com
www.btckan.com/price

Exchanges

Cryptocurrencies are mostly bought and sold through exchanges. These are third party companies which allow users to trade with each other in real time. The major exchanges for Bitcoin (including pros and cons) are:

- www.bitstamp.com (Currently the most reliable exchange)
- www.binance.com (This exchange is great for BTC, LTC, NEO and other smaller cryptocurrencies, designed for trading)
- www.coinbase.com (Great exchange for newer users - Really simple)
- www.bittrex.com (Hosts a mixture of coins, ranging from the bigger coins such as BTC, ETH and LTC all the way down to smaller coins such as XEM, DCR and XVG)

Cashing In / Out

If you want to buy or sell bitcoins on an exchange, you will need to make a deposit. If you want to cash out, you deposit bitcoins. If you want to cash in, you need to deposit fiat (USD, EURO, etc). The most common way to cash into an exchange is bank transfer. Some exchanges also accept payment methods such as Credit Cards and PayPal however there is typically a larger fee for doing this. Alternatively, if you have RS Gold, many people on Sythe can offer BTC / LTC / other crypto for gold. This can be an easy way to get into cryptocurrency without the complexities of making a bank wire or even buying cryptocurrency for Credit Card and PayPal. Most exchanges would require identity verification if you plan on buying cryptocurrency through their platform.

Coinbase offers a referral service in which if you buy $100 worth of cryptocurrency the person who referred you as well as yourself both get $10 worth of Bitcoins for FREE! Referral links can only be found and/or advertised in a signature though.

Bitcoin/Crypto Wallets

If you want to receive bitcoins directly, you need a Bitcoin wallet. This should be done carefully. Bitcoin wallets are prime targets for hackers, since transactions are irreversible. If someone is able to hack your Bitcoin wallet, you will lose all your coins.

A Bitcoin wallet is used to send and receive bitcoins. You can send BTC to exchanges and other people from your wallet. Avoid using online wallet services, unless they are offered by extremely trustworthy sources. Many people who have set up these services have run away with the coins. If you want a wallet, create your own.

http://bitcoin.org/en/download

The bitcoin-qt wallet is one of the most popular and up to date wallets out there. The download will take a long time, since you are downloading the entire Blockchain (which is a record of every transaction in the history of Bitcoin!). Expect 6-7 hours to be fully synched up to the network. The wallet looks like this when it's up and running:

For more information on securing your wallet, read: Storing bitcoins - Bitcoin Wiki

Mining

So, where does this currency come from? How is a Bitcoin or Litecoin created? This is where mining comes in. Bitcoin is mined by running specific software which solves mathematical equations generated by the Bitcoin system. In the early days, mining was viable from any regular computer, however, today it has become highly specialized.

 

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How to keep up with current pricing

Using some exchange sites you can track the current rates of bitcoins and some altcoins with other currency's.
The only problem with these exchanging sites is that their trackers update on refresh or very slowly when on auto-refresh.

Using the website http://bitcoinwisdom.com/ you will not have these issues.
The website looks like this:

1.
The market tab shows all different markets. Clicking a different exchange website will instantly update the graphs to go with the website.

2.
These buttons affect the time and dates of the graph, 1 minute shows the most recent and smallest piece of the graphs, while 1 week shows the biggest graph available with data from the first days of the cryptocurrency's.

3.
Volume of the market.
Hovering over the individual bars shows the exact marketvolume being traded at the time.
The green bars represent the price going up, relative to the bars in the graph at number 5 and 6.
The red bars represent the price going down, relative to the bars in the graph at number 5 and 6.

4.
The realtime market.
This shows all the cryptocurrency being traded at the time. You can see how much crypto's are getting bought and sold, and the exact price they were sold/bought for.

5.
The orange line shows the market change average.
The line is relative to the latest price, but is made using an algorithm that includes the previous X amount of transactions aswell.
This shows a pretty good average price change for the last few hours or so.

6.
The blue line shows the current market price change.
The line is not relative to the last X amount of transactions, but is relative to only a few bars. Much less than the orange line, this blue line shows the current price change and is very easy to keep up with the current changes in price.