Learning about crypto is sometimes like drinking water from a fire hose. The flow of information is overwhelming, and you may accidentally miss crucial information.
So, what are some basic crypto knowledge that we may not know? The following are selected from the insightful comments of Bankless forum users (representing their opinions, not bfrenz's stance). They not only provide valuable resources but also share real-life experiences.
01
Andrew Hearse:
Your coins are not in your wallet.
02
LocationStation:
Cryptocurrencies are not the stock market. Not all cryptocurrencies are currencies or aim to become currencies. Most cryptocurrencies are non-anonymous and provide highly transparent financial transaction reports. This is a major selling point of DLT (Distributed Ledger Technology) or using public blockchain to record transactions. Also, Bitcoin and Ethereum are not currencies, they are infrastructure. They have proven to be value stores, like cables are an essential part of communication systems, and you own a piece of fiber optic cable.
03
Paladin:
The best alpha is obtained from governance forums (alpha - early investment advice or information that gives you an edge in the market).
04
High Warlok:
Your coins are on the blockchain, not in your wallet. You are 100% responsible for your actions in the crypto world, and no one will cover your mistakes. Transactions are immutable. You can look at the recent example of BNB being hacked and the BNB Chain being temporarily shut down when a transaction was not completed (BNB Chain is one of the most active smart contract blockchains).
05
Yavor Kaludov:
NFTs are not about "something," they are proof of ownership and authenticity of "things." NFTs are just tokens, like regular tokens issued by smart contracts. The difference is that NFTs are unique. The uniqueness of NFTs is proven by the embedded serial number, which is unique. For example, when you have something like an image, the NFT will save an address, like a link, that points to the location where the metadata and content represented by the NFT are stored. In most cases, this will be a decentralized storage solution, like Filecoin and IPFS.
06
Grace:
You cannot dismiss the concept of cryptocurrencies just because you have no issues with your local bank or financial system. Billions of people worldwide have legitimate concerns and worries about their banks and financial systems. We should strive to maintain an open mindset, as you may discover a valuable application of cryptocurrencies for yourself one day.
07
Laramie:
Most people are unaware that even if the ownership of your account is anonymous or pseudonymous, your transaction activities are 100% public. In other words, if we don't pay attention to privacy, we are creating the greatest financial surveillance tool in history.
08
sio.eth:
Seed phrase + wallet security + management + token allowance, 99% of scams are conducted using these smart contract methods (seed phrase is the mnemonic phrase often required to back up when creating a wallet).
09
O. Tom Chhuong:
Unlike most traditional stock trading accounts, cryptocurrencies do not have stop-loss functions through self-custody or on centralized exchanges (CEX). Therefore, significant losses are inevitable unless there are profits.
10
BlackLabelBob:
Blockchain is the best technology medium invented by humans for transferring currency.
11
Alemalu:
Making money is not the only reason to be involved in the crypto space. You must give back to the ecosystem. Be with the right people, follow the right people on crypto Twitter. Bear markets are the best time for building and learning. When you start your crypto journey, learn the basics first and focus on one chain. We are still in the very early stages of this journey. The world belongs to the "nerds" who love learning!
12
CryptoCycles.eth:
Understand token economics. High returns usually occur in tokens with very high inflation rates. Before entering crypto, DYOR (Do Your Own Research), especially when the returns seem too good to be true, take a closer look before making a decision.
13
Slf_Svrgn:
Web2 = software is eating the world. Web3 = blockchain is eating software.
14
Dima Vastianov:
Most large-scale applications of chains are driven by marketing hype rather than absolute innovative technology. For example, Solana is highly centralized and relies on Amazon Web Services to stay online. Cardano is supported by Hoskinson, but no one understands how it works. Most chains/projects are copies and pastes of open-source projects like Bitcoin and Ethereum with little to no changes. For example, zk rollups were introduced by Zcash and then acquired and developed into large-scale businesses by Polygon and Starkware (these projects have received significant funding from venture capital firms).
15
Filiberto:
In the crypto space, you won't be bothered by ads (Web2).
16
Greg Goodfliesh:
When buying cryptocurrencies, you need to think in terms of decades and have a long-term perspective.
17
Mushkin82i6:
When you stop and analyze the damage caused by "hackers," you will find that the prime suspects are the system administrators/programmers with the highest security clearance in the project, which is logical. Unless these companies have strict chains of command and check and balance access levels, problems and robberies are only a matter of time. The integrity of any organization dealing with financial value tools is directly related to its leadership. Even with supervision, people are still responsible for these things.
In my opinion, one day this fact will motivate or require experienced and influential leaders in the crypto community to form an experienced group and jointly establish some kind of technical security protocol association. A power that obtains the authority to execute security protocols (including financial aspects and end-user privacy) through a vote by the "crypto community" as a whole. I know this is basically what the SEC (U.S. Securities and Exchange Commission) does. But I'm not talking about securities in this scenario.
I hope this concept can be realized soon. Because as someone mentioned earlier, DeFi needs to be straightforward and make more progress, otherwise all of this will become a universal surveillance tool. Once too many people are financially harmed, two things will happen.
- People's trust in DeFi will disappear, and they may even think that the "old centralized way" seems not bad.
- The authorities will be forced back into their previous positions of absolute power and control.
mvalente:
Your wallet is only used to manage public/private keys.
Crypto is not Web3, and Web3 is not cryptography. You can have Web3 without cryptographic properties (although cryptography is helpful), and vice versa. Web3 is about decentralization and alliances, with or without cryptography.
Fundamental analysis is almost impossible.
If your coin depreciates by 50%, you need more than a 50% valuation to recover.
Non-custodial is like in the real world: when you get a mortgage, you don't transfer your house or property to the bank's address or ownership.
Josh Crawford:
Are there any good quantitative analysis resources?
mvalente:
Start with technical analysis: moving averages, RSI, other "hard" indicators; forget about "flags" and "pennants" tricks. If you want to do this kind of analysis with similarities and repetitive patterns, you should use fractals on time series data or use "candle" images for AI/ML pattern recognition, but it's not easy to do.
You can find a lot of information at https://tokenterminal.com/, such as price-to-sales ratios and other websites.
For predictions, I like using the Facebook Prophet library. If you Google "Facebook prophet crypto," you will find plenty of articles detailing how to do it.
For finding more practical hard numbers, I like going to https://coinmarketcap.com/all and then using filters.
In this website, you can find a lot of metrics for multiple tokens and strategies proposed by other quantitative traders: https://cryptoquant.com/asset/btc/summary.
Reference link:
https://newsletter.banklesshq.com/p/whats-basic-crypto-knowledge-that/comments