Bitcoin Bitcoin what is Bitcoin I know you've heard of somebody who has made so
much money with Bitcoin and I'm sure you're excited to learn about it my name
is Limor and I'm gonna show you how to crush it with your finances today's
episode I'm gonna be explaining Bitcoin come on this will be fabulous
Bitcoin is in fact a cryptocurrency let's focus on the second word their currency now let's
talk about currencies more generally because I think that might help kind of
put everything in context together so right now in the world every country or
group of countries has a currency associated with so if you live in Canada
of course you have the Canadian dollar if you're in the US we've got the US
dollar if you're somewhere in Europe well you've got the Euro all of these
types of currencies are actually called Fiat basically that just means that the
government has identified those as the currencies for legal tender in that
particular country or area now let's blow this out okay go crazy in your
imagination if we look at the world in totality what would happen if we were to
overlay one currency that could be traded or used across all the countries
of the world and there you have Bitcoin now Bitcoin is brand new or seemingly
brand-new in the main Stream anyways it's been around since 2009 and because
it's not associated with a specific country there isn't a government that
governs or dictates or talks about what happens with the Bitcoin or with
cryptocurrency in general and so this is called a decentralized model and one of
its nuances is that of course it the currency isn't backed by anything
there's no real estate behind it there's no stock behind it there's no gold
behind it and this tends to freak people out but you know what the truth is all
of our currencies aren't backed by an we've just been using them for so long
that we don't even stop to think about it you know just kind of commonplace
that you go out you earn this currency you use it you shop with it all that
kind of good stuff and you don't think twice about it now
with the introduction with Bitcoin and crypto currencies well people are
feeling a little bit heebie-jeebie about the fact that there's no no backing
behind it the interesting thing of it though
is actually how this came to be and the technology that lives behind it which
makes this all possible and it's actually called the blockchain you've
probably heard of it but it's just as cryptic of a word as Bitcoin so let's
explain what blockchain is blockchain is basically a transparent ledger that
is housed on a global network that tracks all of the transactions that are
happening within the cryptocurrency space this new technology is really cool
because it is really really safe and really really secure so if you think
about it a particular company or a particular country you may have some of
their data stored on a particular computer on a series of computers on
some servers but when it comes to Bitcoin and the blockchain and the way
that's actually tracked it is on so many computers that it's virtually impossible
for it to be hacked because all of them would need to be hacked simultaneously
that's what makes it really really secure now on top of that what's also
really neat is the fact that for those of us who are transacting or all wallets
or individuals participating in the cryptocurrency world you're actually
anonymous now I know some people freaked out at that and sort of think well Oh
cryptocurrency must be for all these like scams and all these sort of shady
things and yeah no doubt I'm sure there's some of that that's going on but
the truth is for most of us it's just nice to be able to transact in an
anonymous way in a way that we are actually control of what's happening and
nobody really knows what we're doing and so within the blockchain we are able to
be completely anonymous all of the data is
completely transparent but it's no longer connected to you as an individual
you've got a wallet address or an ID where you're self identifying so if you
want to make a transaction you'd of course you know if you're transferring
money you'd need to share what where you're transferring from because it's
completely transparent on the ledger but you as an individual do not have your
name and your identity connected to your wallet address or your wallet ID bear
with me and let's take a look at an example together so let's say that we
have got three particular individuals let's call them alpha Bravo and Charlie
and let's say that right now alpha has 10 Bitcoin at the time that I'm filming
this video you should know that a single Bitcoin is worth $9,000 so in this
instance this individual would have $90,000 $90,000 US dollars worth of Bitcoin but
let's not worry about that for now let's just keep it with simple numbers
so we've got alpha alphas got 10 Bitcoin now alpha wants to give Bravo 5 Bitcoin
so maybe in return they're doing some services maybe they're purchasing
something maybe it's a gift that's not really the point of this but we can see
because alphas wallet is public on the blockchain it's very easy to see what
the wallet address of alpha is at how much money is there and so you can see
that there's 10 Bitcoin and so when alpha wants to give Bravo 5 Bitcoin of
course you can see that there's enough Bitcoin there alpha transfer to Bravo
5 Bitcoin and so now alpha is left with 5 Bitcoin now this particular
transaction is of course tracked on the ledger on the blockchain which is housed
on many many many many computers and so that's then public record that alpha
transferred 5 bitcoin to Bravo now Bravo has 5 Bitcoin and that can be
viewed as well on the blockchain now let's say that
Bravo wants to transfer three Bitcoin to charlie so of course there has to be a
verification and the verification of that process is actually even called
mining I'll get into that in another video but essentially there is an
element where there is confirmation that of course Bravo has the five Bitcoin and
of course that's more than three which she wants to give to Charlie
so then three of the Bitcoin are transferred from the wallet address of
Bravo down to Charlie and then Charlie now has three Bitcoin now if we go back
to take a look at alpha at this point in time alpha still has five Bitcoin now if
alpha wants to do a business transaction or a barter I should say more
appropriately with Charlie that's going to cost six Bitcoin it's very easy to
verify that in fact alpha doesn't have six Bitcoin and so part of this
verification is where all these other miners come into play and take a look to
verify the transaction whether it's there or it's not
it's very quickly identify that the money isn't there
so of course alpha cannot transfer that down to Charlie now I don't want you to
get too confused on the actual elements of this particular example but the
things that are really important to note is that it's very safe the blockchain
it's very secure it's completely transparent and you can remain anonymous
and all of this makes the process very different than the way it exists in
current day when we're transacting with actual physical currency and hopefully
you can see that if you wanted to buy your own Bitcoin and I should actually
note that there's currently over 1,500 coins and currencies and tokens and I'll
explain that in a separate video the difference between those but if you
wanted to purchase your own cryptocurrency at this point in time
like buy into one that's already existing one of the easiest ways to be
able to do that is through an existing exchange now there's lots of exchanges
some of them are newer some of them larger in terms of trade volume and you
know we talk about Bitcoin because it's kind of like the main one but it's also
kind of like calling tissue Kleenex in the sense that it's what become has
become mainstream but there's tons of different crypto currencies out there
and especially with Bitcoin and its value being so high I mean when it's
thousands of thousands of dollars you're not really gonna use it to buy a cup of
coffee or those small micro transactions if you do want to purchase a
cryptocurrency the easiest way to do it is through an exchange but the challenge
is that it's still not a user-friendly easy simple process and that's partially
because this was all created by you know all those brilliant computer folks who
created the process and it wasn't really intended initially at least to be
mainstream and it hasn't become that user-friendly yet so downloading wallets
is still a little bit clunky when you transfer your money into the exchange
whether you wire it or email transfer it it takes a couple of days before you get
your Bitcoin and then if you wanted to use for a different currency you'd have
to exchange it on one of the many exchanges that are out there and I
should note that actually unlike stocks typically a cryptocurrency will be
traded on multiple exchanges usually in and around the same value but you know
you will have to go through all of those various steps if you want to buy and you
want to get into it now I should also explain that there's two
main reasons that people really get into cryptocurrency one is because they want
to make money of course we all want to make money I want to make money I know
you want to make money but when you want to make money there's kind of a couple
things that are happening within that umbrella of making money so the first
one is something like day trading where there's all these different currencies
and coins out there and you know the goal is to buy and have the value go up
and then sell and of course so many of us end up doing that backwards you know
we buy up here and we sell down here but anyways with a very very volatile
currencies there's an opportunity that if you
buy in the right place and you sell in the right place you will make a lot of
money and that's probably what a lot of the media and hype and trends has really
all been about and within that same umbrella there's also those individuals
who are looking to buy a currency in the crypto world you know have it go up over
time and then sell it and be able to use that money for something significant in
your life later maybe it's retirement or buying a home or something like that so
section number one is really about making money and the second reason why
people really get into cryptocurrency which is a little bit more about its
intended origin if I understand correctly is that people want to be able
to use it people want to be able to barter it for stuff trade it for stuff
be able to transfer money in a much easier way and there's actually a ton of
benefits in the cryptocurrency world and that's a lot of the time I think what
people are actually initially forgetting with all the hype of oh my gosh let's
make money oh there's this coin oh I'm making all this money that's really
initially intended to be able to use it so let me give you another example um me
and my grandma my lovely grandma who lives in Cape Town South Africa and I
live in Toronto Canada now let's say that it is her birthday coming up and I
want to be able to send her to the spa for the day so I may reach out to my
aunt in Cape Town and say hey I'd love for you to take gran to the spa for me
on her birthday and so historically if I wanted to do something like that I would
obviously need to be super proactive and tell my aunt sometime in advance I would
likely go into my bank tell them how much I want to transfer they would take
a fee and realistically it would take a week maybe a little bit longer for the
money to be able to be transferred and of course they've taken a cut in the
process and no joke this is definitely an expensive thing to do and it has been
quite expensive in the past trust me I've sent money across the world and so
if we sort of fast forward to what we're looking at here with cryptocurrency if I
have a wallet and my aunt has a wallet well what I can do is send the
cryptocurrency directly to her it happens very very quickly and there's no
transaction fees in the process and nobody else has known from a banking
perspective what I have or haven't done now of course I'm not doing anything
sneaky I'm just trying to take my grandmother to the spa for her birthday
but it's nice to know that I have this complete control over my money and what
it's doing and that it can get there really really quickly in fact the other
day I was on the phone with a friend of mine and he was transferring money to
Peru to a friend of his there and we timed it and it took 38 seconds for the
money to get there now that is probably on a slow day but pretty cool that that
really changes things so transferring money is so much quicker there's no fees
in the middle now of course there are elements of downside in the sense that
you know you can't get the money transfer back if you need to if you know
you you mess up your wallet and it's on your computer and you haven't back
anything up and you smash your computer and it's completely gone to bits you
know you can't get it back so there's some safety precautions to be taken when
you're you know in cryptocurrency but that is so cool I could now send money
across the world by wallets I know you can do it via text messages and so you
know for folks who maybe don't have access to the kind of banking that we do
here in North America you know they now have access to banking
in a whole nother crazy way that's far more cost-effective and so you know one
way is of course transferring money across the world but there's lots of
other uses you like you know taking the currency that you have and bartering it
and I'm using the word barter because that's I guess what it's really called
for all kinds of services so a currency that I'm really involved in and please
don't take this as investing advice it's called Niko which is nikola tesla's
coin and it's not one of those you know oh let's create a trump coin I've
actually seen all of the branding and all of the official letterhead to be
able to use the Nikola Tesla names for the coin called Niko now I have in my
area here a plumber who accepts Niko a co-working space there's charities so I
can actually start to use the currency in a whole nother way and what's neat
about some of these other currencies that aren't necessarily Bitcoin is that
you know when when bitcoin is nine thousand dollars you know it's really
hard to really transact in all these microwaves
whereas when I'm using other currencies or if you're using other currencies that
are far smaller the transaction fees are really low and you're not using a piece
of a really big pie if you will which is a Bitcoin to be able to be doing that
kind of transaction I know there's a ton of speculation on cryptocurrency then
Bitcoin and all that other kind of fun stuff but you know I think it's really
here to stay is it gonna look like what it looks like now I have no idea I do
not have a crystal ball all I know is that it's this really new concept it's
this really new world that so many of us are participating in I will give you my
giant warning that says there is a ton of volatility it goes up it goes down
it's not backed by anything as I mentioned already earlier and so never
never consider putting money into crypto currencies
unless it's money that you are prepared to lose because there is a ton of
speculation and in many sense is still an element of gambling and you've worked
really hard for your money and I don't want you to lose it I want you to live
your financially fabulous life so I hope you enjoyed this video and that the
world of cryptocurrency and Bitcoin is a little bit easier for you to understand
and if you've got questions and you've got comments leave them below and I will
definitely be creating more videos on cryptocurrency I absolutely love it I
think it's so fascinating there's so many cool nuances that I
definitely want to continue making all kinds of videos to share with you guys
so again if you liked this video give it a thumbs up subscribe to my channel and
click on the bell so you're notified when my next videos come on out and as
always if you're looking for more tips and tricks and inspiration to make your
life even more financially fabulous come on over to Limor.money I got
lots of great resources for you to access and download thank you so much
for watching and I will catch you next time till then stay fabulous
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