Bitcoin 101

Rich DeMuro talks about the basics of cryptocurrency and Bitcoin.

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Episode Transcript

Speaker 1 (00:00):
Bitcoin one oh one. I'm Rich Demiro and this is
Rich on Tech Daily. Okay, how many times have you
heard someone talk about bitcoin, cryptocurrency or blockchain. These buzzwords
are being thrown around like everyone knows what they mean,
but do they really. I figured, you know, what it is, time,
with so many people investing in this stuff and talking
about it, to get a little bit more information about it.

Speaker 2 (00:21):
So I talked to Alan Goren.

Speaker 1 (00:23):
He's a financial technology entrepreneur based in Los Angeles. He
also hosts one of the biggest cryptocurrency investment events every year.
It's called the Crypto invest Summit. And he told me
point blank, the average person does not understand And he said,
the average person who's a bitcoin millionaire probably doesn't understand
bitcoin for the most part, which is kind of crazy
because people have made money on this stuff.

Speaker 2 (00:45):
He's all into this stuff.

Speaker 1 (00:47):
He even got his wife to write a book on
it called Bitcoin for Babies, which is really cute. It's
available on Amazon. But let's start with the basics. Cryptocurrency.
This is a new type of digital money that basically
uses complex math equations instead of bank records to verify transactions.
And Goren says there's over fifteen hundred different types of

(01:07):
cryptocurrencies and they all do different things. Now, of course
we've all heard of bitcoin. That's the most widely known,
so it's super popular. And he said the reason why
it's most popular is because it was the first major cryptocurrency.
It got the most adoption, and it was really revolutionary
in what it did. Now, like cash, cryptocurrency is anonymous,
but there's a big difference. Unlike cash, cryptocurrency is independent

(01:31):
of all banks or government.

Speaker 2 (01:33):
So basically, this is the crazy part.

Speaker 1 (01:35):
Every single little piece of cryptocurrency carries its own record
of everywhere it's ever been exchanged.

Speaker 2 (01:42):
Yes, that record gets pretty big. And the reason why Goren.

Speaker 1 (01:46):
Says that this is special is because it is called trustless.

Speaker 2 (01:50):
That means you don't have to have a middleman.

Speaker 1 (01:52):
So, if you think about it, the way that you
normally send money is from bank to bank. The bank says, yes,
we have this money, we approve it, and the other
bank says, okay, we've received this money, and we acknowledge
that this all happens within the currency itself, which is
pretty amazing when you think about it. So what is
the biggest thing holding bitcoin back? Well, it is slow
transaction time. Think about it right now, Every transaction must

(02:16):
be approved, and it's approved through these computers, a worldwide
network of peer to peer computers. They call these things minors,
and anyone can really sign up to be a minor.
They do all the work and if you solve one
of these transactions, you're rewarded with a little bitcoin for yourself.
So you have a lot of people doing this and
that's how the system propagates.

Speaker 2 (02:36):
That's how the system.

Speaker 1 (02:37):
Actually works because there's always someone out there that wants
to say, Hey, I want a little tiny piece of
the money here, so I'm going to solve these transactions
and that's what really powers the entire system. So why
are investors going wild over all these new currencies like
Bitcoin and similar currencies you've heard about, cryptocurrencies like.

Speaker 2 (02:56):
Light coin and ethereum.

Speaker 1 (02:58):
Well, Goren says, there are lots and lots of very
valuable tools being built on them, and that is what
the value is all about.

Speaker 2 (03:06):
So where can you spend this money? If you buy
some bitcoin?

Speaker 1 (03:08):
I actually bought twenty five dollars worth of bitcoin through
an app called square Cash. It made it really easy,
but spending bitcoin, it could be a little bit tough
for the average person. Right now, just a handful of businesses,
big businesses accept it as a payment type. You're not
going to find it as a checkout option on Amazon,
but overstock dot Com is one of the pioneers and

(03:29):
accepting it, and there's a whole bunch of other companies
as well. Coinbase is one of the popular websites for
buying bitcoin. That's probably the most popular, the one that
you hear over and over. They have a whole list
of companies where you can spend it as well. But
if you've been keeping up on the bitcoin news, you
know that the price fluctuates wildly. So the twenty five

(03:49):
dollars that I put in there as of today is
up to twenty eight, but it was down to eighteen just.

Speaker 2 (03:54):
A week ago, so it is pretty crazy.

Speaker 1 (03:57):
It's like an investment, so if you're gonna put money
on this, you need to understand what you're getting into
before you plunk down your cash.

Speaker 2 (04:04):
All right, If you want to learn.

Speaker 1 (04:05):
More about bitcoin, you can find some resources and links
on my website.

Speaker 2 (04:08):
Just go to rich on tech dot tv.

Speaker 1 (04:11):
Hopefully I help you understand a little bit more about
this emerging currency. It is very interesting and very unique.
I'm rich Demiro rich on tech.

Speaker 2 (04:20):
I'll talk to you next time.