My Beginnings in Crypto Currency
Origins of Bitcoin and My Family
Let me first start off by saying I have 4 children (youngest is 16 and oldest is 25). My youngest and oldest are very technologically advanced when it comes to computers and programming. Back when my oldest was still living at home and attending high school, I remember he set up a few computers in the basement with his friends and said he was using them to mine Bitcoin. At the time, this had absolutely no meaning to me. I just made sure he wasn't doing anything illegal and let him go about his merry way. He did this for awhile and then the novelty wore off. According to him, at the time, he said he had only mined "fractions" of a Bitcoin.
Now I'm not certain what a bitcoin was worth back then but it was somewhere around $100 - $200 per coin.
Talk About Expensive Dinners
It was during the second half of 2017 that Bitcoin was becoming a very popular term in my life and every day I heard more and more about it. As we all now know, the price for a Bitcoin shot up beyond anyone's imagination to values as high as $16,000 per coin during the late part of the year.
You've all heard those stories of the first person that used Bitcoin to pay for a pizza. He actually used two Bitcoins at the time. Those two Bitcoins are now worth over $25,000 so that was one expensive pizza.
My son had a similar story but much less socialized. He and a bunch of his work friends went out to dinner one night and when it came time to split the bill, his one friend who paid for the dinner didn't have Venmo (an electronic way to pay people) or Paypal. He did have a Bitcoin Wallet (term used for where you store your Bitcoin). Based on that, my son simply transfered a small amount of Bitcoin from his electronic wallet to his friends to cover his part of the dinner.
At the time this happened, it was way before Bitcoin took off, so it seemed like a perfectly good way to solve an immediate problem. Granted, at the time, it was probably a $15 - $20 cost for his part of the dinner. Until this day, he won't say what fraction of a Bitcoin he transferred, but today, even a fraction of a Bitcoin is worth alot of money.
Regardless of how much money he had given away that night, in the long run, he still made out pretty well. With the run up of the price for a Bitcoin, my son told me he was thinking about selling all his Bitcoin to pay off the remainder of a $7,000 car loan he has. To amass $7000+ from a mining exercise he did in the basement as a high school student, I'd say he still made out just fine.
Relevant Links on Crypto Currency
- How Coinbase Can Make a Crypto Currency Skyrocket in Value and What You Need to Do to Be Part of It
Getting listed/supported on the Coinbase exchange is a huge thing in crypto currency. What are the next currencies coming to Coinbase and what can a newbie to Crypto Currency do to take advantage.
- Bitcoin: How Do I Get in the Game?
With all the hype being heard about Bitcoin, how can a novice understand what this is and even more importantly, how can you get involved in investing in crypto currency.
Fast Forward to December 2017
It was early December that Bitcoin shot up to over $16,000 per coin with projections saying it will surpass $20,000. Everyone was talking about Bitcoin and crypto currency. My youngest son is now really getting into it and we talked a lot about getting involved. I was a little concerned based on all the talk about this all being one large bubble. There is no central organization or central body that backs all this crypto currency so it is definitely a risky adventure. At the same time, we're sitting on the sidelines watching a lot of people make a lot of money.
Based on all the hysteria, we decided to get into the game. Based on the risks I mentioned above, I fully agree that one should only invest money that he/she can afford to lose in the worst case.
Based on all this, we wanted to start a small portfolio of crypto currency. Yes Bitcoin is the one everyone hears about all the time, but there are literally hundreds of different crypto currencies out there that you can invest in.
So I started looking into how I can set up an account to get started. I was very leery about giving any of these sites my banking or credit card information. After doing a lot of investigation, I found that Coinbase is a highly reputable exchange based here in the United States so I signed up.
One mistake I made was to not use a Coinbase referral link when I set up my account. If I would have used a referral link, I would have recevied a free $10 worth of Bitcoin after making my first $100 purchase and the person whose link I used would also receive a free $10 worth of Bitcoin. You never know how much that free $10 could turn into in this crazy Crypto world.
So based on that, I'd ask that any newbies out there planning to do some investing in Bitcoin or other crypto currency, to use a referral link like the one listed here ==> Coinbase Registration
Setting Up Our Small Portfolio
After establishing the Coinbase account, over the course of December, we invested roughly $1000 in various coins. You always start out by buying Bitcoin, then you can convert your Bitcoin to other currencies, either on the Coinbase exchange, or by transferring it to other exchanges who support the coins you're interested in buying. I won't go into those details here, simply to say that you need to be aware of the different fees being charged to both purchase and exchange currency from one exchange to another.
Via several different deposits, we created a portfolio which contained small amounts of Etherium, Litecoin, Bitcoin (all on the Coinbase exhange), as well as alittle bit of Ripple and Bytecoin (on the Cryptonator exchange). In a little over a month, that $1,000 investment is now worth over $2400 and is still growing.
This crypto currency market is really unbelievable in terms of the growth. Each day comes with either large gains or large drops in value. I will say it is not for the faint of heart. The drastic up and downs of the prices can really get you nervous. My idea is to make these initial investments and just let them sit there..
Conservative Investments With a Few Long Shot Investments
So based on the Coins I mentioned above, I consider Bitcoin, Litecoin, and Etherium my conservative investments, something along the lines of stocks in the Dow Jones Industrials. Ripple and Bytecoin are more two long shots. I consider these my penny stocks.
If I had more money to invest, I'd buy some more long shots like IOTA. DASH, and Monero.
So why did I choose Ripple? There are rumors that Ripple may soon be sold on the Coinbase exchange. Anytime a coin gets added to Coinbase, the value of that coin will immediately skyrocket (see my other article entitled How Coinbase Can Make a Crypto Currency Skyrocket in Value and What You Need to Do to Be Part of It)
So why did I choose Bytecoin? Bytecoin is my true "Penny Stock". When I bought Bytecoin (BCN), it was valued at less than a penny per coin. With a mere $30, I was able to purchase over 3,000 coins. It has since gone up to a value of roughly 1.5 cents per coin, already doubled my money. Now imagine that Bytecoin takes off and gets listed on Coinbase, making it very easy for everyone to purchase it. That could drive the price to $1, $10, or $20 per coin. That's a huge return on a small investment. Now imagine it takes off like Bitcoin did and sores to $100 per coin. Those 3,000 coins purchased at $30 would now be worth $300,000. OK, I'm getting alittle carried away with my dreaming here but hopefully you get the picture.
That's why my mention above about using a Coinbase referral link to start your account becomes so important. If you used that free $10 worth of Bitcoin you got from the referral and invested it in Bytecoin as an example, you can purchase roughly 800+ coins of Bytecoin. This could be your long shot investment. If Bytecoin takes off, those 800 coins become very valuable. Key message, use a Coinbase Referral Link when opening your account.
This example is very specific to my actions. Bytecoin is one of many different coins you can choose to invest in. You can do your own research and pick a Crypto Currency that you think may be the next big hitter.
My Current Portfolio
So after less than a month of setting up my Crypto Currency portfolio, the value of the portfolio has doubled, mainly on the value of the conservative coins I mentioned, BTC, LTC, and ETH. At this point, I'm just letting everything sit and hope it continues to rise as it has in the past month. I realize I will have to ride out all the ups and downs that take place on a daily basis.
Its not like I invested a lot of money and even that investment was split between my son and I. I do feel good though that I am now in the game as opposed to reading about it on the sidelines. All the news and hype about crypto currency is now relevant to me and it is exciting to be part of it. Not to mention how much more bonding that is taking place between my youngest son and I as we talk crypto currency on a daily basis.
The next endeavor, which the entire family plans to invest together on is "mining" crytpo currency. I will write a separate article in the future about what it means to "mine' crypto currency but in a nutshell, you use your own computing power to run complex algorithms to amass yourself free currency. You can mine whatever coins you like. The more computing power you have, the more coins you can mine on a daily basis. After your initial hardware purchase, aside from the electricity to run your computers, you are basically obtaining crypt currency for free. Now factor in the meteor rise of crypto currencies with the concept of obtaining your coins for free. I'm really looking forward to getting started with the mining. Watch for a future article that documents are foray into "mining".
So I'll end this article with my advice to you being to get involved and start your crypto currency portfolio today. Take only extra money you may have, regardless of how little the amount may be, and start buying crypto currency, then sit back and watch it go!!! Good Luck and comment below about your initial experiences.