You may have noticed that since the big Bitcoin boom at the end of 2017 the crypto market has come under increasing scrutiny - with the inevitable result of knee-jerk reactions and clampdowns of various types.
One that might have impacted you already is the growing list of banks, credit card companies and other financial organisations that have banned purchases of Bitcoin and other cryptocurrencies or digital currencies with their credit cards.
At time of writing this list includes:
UK
Lloyds Banking Group (includes Lloyds Bank, Bank of Scotland, Halifax and MBNA)
Virgin Money
USA
Bank of America
Citigroup
JP Morgan
Capital One
Discover
Canada
Scotiabank
The rationale is that the banks are: "concerned about customers running up large debts following a sharp fall in the value of digital currencies". I think this concern can be read as the banks being worried that they might get bad publicity for the debts - after all, they don't stop their customers gambling or buying alcohol or cigarettes with their credit cards and they have a long history of encouraging customers to borrow and spend money they can't afford to pay back. Perhaps that's just me being cynical though. Others suspect even more Machiavellian motives and that they're doing it to protect their status against an emerging threat.
Let me know if there are any other banks that need to be added to the list.
Note - with the exception of Citigroup, this ban applies to credit cards only, not debit cards.
Thursday, 8 March 2018
Tuesday, 13 February 2018
What, exactly, does HODL mean and why are HODLers always HODLing?
Once you start to spend more time on crypto blogs, forums, Reddits, and other social sites you will quickly come across the verbs HODL and HODLing and the noun HODLer.
It soon becomes apparent that this is an important part of the vocabulary for the initiated, but you may wonder what this mysterious term means and what it stands for, but fear not, the mystery is solved below.
HODL means to hold. It was first used in relation to Bitcoin, and has come to mean holding on to your investment in your crypto of choice regardless of whether it is soaring to the moon and you're tempted to cash in or plumbing the depths and you're tempted to ditch it before it becomes completely worthless.
It was originally just a typo by a slightly drunk Bitcoin investor, but some have bought into the backronym Hold On for Dear Life.
For an excellent and highly entertaining read on the subject, including the original post that first coined the term, I recommend this: https://medium.com/dash-for-newbies/whats-the-backstory-on-the-word-hodl-27756392b698 article by Leah Stella Stephens.
It soon becomes apparent that this is an important part of the vocabulary for the initiated, but you may wonder what this mysterious term means and what it stands for, but fear not, the mystery is solved below.
HODL means to hold. It was first used in relation to Bitcoin, and has come to mean holding on to your investment in your crypto of choice regardless of whether it is soaring to the moon and you're tempted to cash in or plumbing the depths and you're tempted to ditch it before it becomes completely worthless.
It was originally just a typo by a slightly drunk Bitcoin investor, but some have bought into the backronym Hold On for Dear Life.
For an excellent and highly entertaining read on the subject, including the original post that first coined the term, I recommend this: https://medium.com/dash-for-newbies/whats-the-backstory-on-the-word-hodl-27756392b698 article by Leah Stella Stephens.
Monday, 12 February 2018
What is market cap?
Market cap (or market capitalisation/market capitalization) is a term you frequently hear crypto enthusiasts use, mainly as a measure of the underlying value of a coin or token beyond its current market price.
Market cap isn't a term coined by the crypto community though, its more common and long established usage is in defining the value of a company via the mechanism of multiplying a company's share price by the number of shares outstanding.
So, company A with a total of 1 million shares and current share price of $1 per share would have a market cap of $1m. Company B with a total of 50 million shares and a current share price of 20c per share would have a market cap of $10m, despite the share price being significantly lower. This would indicate that the underlying value of company B is, in fact, greater.
Although many outside the crypto world are far from convinced as to whether this translates to cryptocurrencies or whether the market cap of a coin or token is anything more than an arbitrary number - many crypto investors (or HODLers as they often self-referentially call themselves) still base their investing decisions on this simple calculation.
As with shares, the market cap of a crypto can be calculated by multiplying the price by the circulating supply using the following formula:
So to apply the formula to a worked example using NEO:
Which gives NEO a market cap of $7.4bn at time of writing.
Market cap isn't a term coined by the crypto community though, its more common and long established usage is in defining the value of a company via the mechanism of multiplying a company's share price by the number of shares outstanding.
So, company A with a total of 1 million shares and current share price of $1 per share would have a market cap of $1m. Company B with a total of 50 million shares and a current share price of 20c per share would have a market cap of $10m, despite the share price being significantly lower. This would indicate that the underlying value of company B is, in fact, greater.
Although many outside the crypto world are far from convinced as to whether this translates to cryptocurrencies or whether the market cap of a coin or token is anything more than an arbitrary number - many crypto investors (or HODLers as they often self-referentially call themselves) still base their investing decisions on this simple calculation.
As with shares, the market cap of a crypto can be calculated by multiplying the price by the circulating supply using the following formula:
Market Cap = Price X Circulating Supply
So to apply the formula to a worked example using NEO:
$7,415,720,000 = $114.09 X 65,000,000 NEO
(figures from CoinMarketCap 12/02/18)
Which gives NEO a market cap of $7.4bn at time of writing.
Saturday, 10 February 2018
What is an altcoin?
As you spend more time in the world of cryptocurrency, you come across certain terms which you can usually infer the meaning of from context without entirely understanding.
One you will certainly encounter is altcoin. But what exactly is an altcoin?
Essentially an altcoin is any coin or token launched after Bitcoin (the original cryptocurrency). Literally an alternative coin. Some of them are even built on the same architecture as Bitcoin. There's a nice explanation of it here: https://www.investopedia.com/terms/a/altcoin.asp (incidentally, Investopedia is a solid go to site for quick, reliable answers)
Ethereum, and Litecoin are probably the two best known altcoins, but there are literally hundreds of them with different applications including Dash, Bitcoin Cash, SpankChain, NEM, Dogecoin and (at time of writing close to 1,400!).
Most of them will probably disappear, taking your investment with them! Some will go on to establish themselves as market leaders and could make you rich.
Friday, 9 February 2018
Cryptocurrency investment 101 - the hardest lesson
OK, let's just get this out of the way now.
If there's one thing that anyone who's invested in cryptocurrency learns sooner or later it's this:
Whenever you bought, it was the wrong time. You should have bought earlier/later.
Whenever you sold, it was the wrong time. You should have sold earlier/later/held.
It's a painful lesson, but don't beat yourself up over it - pretty much everyone does the same thing.
Whether it's act in haste, repent at leisure or s/he who hesitates is lost, the crypto markets are volatile and brutal, and values can surge or plummet by huge amounts in hours. This gives you plenty of scope to brood over the foolishness of your actions, but don't. There will always be plenty more opportunities if you keep your eyes open.
Just make sure you're not playing with money you can't afford to lose.
If there's one thing that anyone who's invested in cryptocurrency learns sooner or later it's this:
Whenever you bought, it was the wrong time. You should have bought earlier/later.
Whenever you sold, it was the wrong time. You should have sold earlier/later/held.
It's a painful lesson, but don't beat yourself up over it - pretty much everyone does the same thing.
Whether it's act in haste, repent at leisure or s/he who hesitates is lost, the crypto markets are volatile and brutal, and values can surge or plummet by huge amounts in hours. This gives you plenty of scope to brood over the foolishness of your actions, but don't. There will always be plenty more opportunities if you keep your eyes open.
Just make sure you're not playing with money you can't afford to lose.
Welcome to Crypto Bytez!
Hello, and welcome to Crypto Bytez, your bite sized source of information on all things crypto, pseudocrypto and blockchain based.
You won't find anything groundbreaking here, and I'm not trying to sell myself as an authority on cryptocurrency - I'm just a guy interested in crypto who wouldn't mind making a bit of money out of it - but as I learn more and discover things of interest on my journey I'll post them here in easily digestible form for you to share.
There will be posts on all the main coins and their forks (Bitcoin, Bitcoin Cash, Ethereum, Litecoin, Ripple/XRP etc.) and as many of the proliferation of altcoins as possible.
I'll do my best to try to make some sense out of the overwhelming amount of information on the overwhelming amount of coins and tokens out there. Let me know how I'm doing.
See you around!
P.S. Sorry the name's a bit lame, but all the good ones seem to have gone already.
You won't find anything groundbreaking here, and I'm not trying to sell myself as an authority on cryptocurrency - I'm just a guy interested in crypto who wouldn't mind making a bit of money out of it - but as I learn more and discover things of interest on my journey I'll post them here in easily digestible form for you to share.
There will be posts on all the main coins and their forks (Bitcoin, Bitcoin Cash, Ethereum, Litecoin, Ripple/XRP etc.) and as many of the proliferation of altcoins as possible.
I'll do my best to try to make some sense out of the overwhelming amount of information on the overwhelming amount of coins and tokens out there. Let me know how I'm doing.
See you around!
P.S. Sorry the name's a bit lame, but all the good ones seem to have gone already.
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