Ep 2 - Cryptocurrency and Setting up a Digital Wallet

Speaker: 00:00:02

Episode two - cryptocurrency and setting up a digital wallet. Welcome back and thanks for tuning in. A reminder that in the link section of this episode, you will get access to Max Volume's Meet The Metaverse Guide, a resource to all the companies and projects I mention throughout this podcast series. It will help you take your exploration into the Metaverse further. Let's now explore the world of cryptocurrency.

Speaker: 00:00:57

There are over 8000 currencies that you can purchase from exchanges, just like you would purchase shares from an online exchange. You can purchase crypto coins and tokens from exchanges like Gemini,Coinbase, Coinhako and Binance. Just to note that Binance is not available in Singapore. You can buy cryptocurrency using your credit card, or you can connect it with your bank account. To sign up to any one of these exchanges you obviously need to verify your identity. So there are a few steps necessary. Once you're on, you can start buying cryptocurrency and using it to either hold - so you want to invest and hold the cryptocurrency and hope that it goes up over time - or you can use that cryptocurrency to start making purchases like buying NFTs or getting access to games. You may have looked at the price of cryptocurrency, especially the two most expensive coins - Bitcoin and Ether - and wondered to yourself what makes them so expensive. Bitcoin has gotten a lot of press and controversy for its high volatility, and it has reached very high values which peaked at $US68,000 in November 2021 before tumbling again. One of the reasons that the price of Bitcoin is so high is that the supply is finite. There will only ever 21 million Bitcoins created and not all have yet been issued. Ether's high value at around $US4,000 per coin is owed to its high usability and compatibility with so many current DApps. You can see what the total issue number is for all cryptocurrencies by heading directly to their websites. So do you need to have 10s of 1000s of dollars to buy either Bitcoin or Ether? The answer is no you don't, which is good news. You can purchase a fraction of these coins rather than the entire point, because Bitcoin is divisible by up to eight decimal places and ether is divisible up to 18. As an example, if you have $100 and you want to convert that into cryptocurrency, for some of the cryptocurrencies on the market, you may get multiple coins for that $100. In the case of Bitcoin and Ether, you would be getting a fraction of ownership of those coins.

Speaker: 00:03:16

8000 cryptocurrencies is a lot because people can create their own cryptocurrencies. Blockchain is an open source code, so it's accessible to anyone with the programming skills to use and build their own. If I wanted to create my own cryptocurrency I could, but it doesn't mean that anybody would ever buy it. So the cryptocurrencies that are, say the 15 most popular, have achieved their value through a combination of a great story, great marketing, great product, and adoption by enough people that they become one of the more popular cryptocurrency assets that have value. Certain cryptocurrencies exist as the only way you can transact within particular blockchain games and communities. So as these games and communities grow in popularity, so does the value of their currency.

Speaker: 00:04:07

Once you've successfully purchased your cryptocurrency, you need to figure out how you're going to store it because there are no banks on the blockchain. This is why digital wallets were created. A digital wallet is your own personal wallet that becomes the repository of your digital currency. When you purchase your cryptocurrency you will be looking for digital wallets that support that currency. Popular wallets are Metamask Coinbase Wallet and Ledger. The exchange where you purchased your cryptocurrency will give you the functionality to be able to transfer your cryptocurrency directly into your wallet. Metamask, Coinbase and Ledger are all apps that you can download directly to your phone and on your desktop. What Ledger offers as well is an extra level of security with their Ledger hard drive wallet. It looks like a USB stick, and you can transfer your money out of the Ledger app into your Ledger Nano harddrive.

Speaker: 00:05:06

As part of the signup process for any digital wallet, you will be presented with what's called a seed phrase. A seed phrase is a string of up to 25 randomly generated words that are unique to your wallet. So it's super important that you write down that seed phrase and keep it incredibly secure. The seed phrase is your private key, it is equivalent to a PIN number. If you lose that seed phrase, you will not be able to get access to your wallet. It's that simple. This seed phrase is your private key. But you also have a public facing key called your Wallet Address that can be given out as both a QR code or as a series of numbers. It allows people to send you cryptocurrency or tokens, and when someone gives you their wallet address, it also means that you can send them cryptocurrency or tokens. These transactions are so seamless now that people can send crypto and NFTs as gifts and as payments for jobs done. This is the new digital economy. And hopefully now with this information you feel more confident about buying cryptocurrency and setting up your digitalwallet.